U.S. banks set a record for earnings

U.S. banking sector as a whole has started 2012 on a positive note. For the first quarter, local lending institutions have managed not only to make a record for the last five years, $ 35 billion, but also significantly reduce their losses on loans. This positive trend has pleased the authorities that guarantee deposits of U.S. banks - for the first quarter, the Federal Deposit Insurance Corporation (FDIC) has expanded its balance sheet directly on the $ 3.5 billion
U.S. FDIC summarized the activities of national banks for the first quarter of 2012. The result is a record of calculations of total banking income at 35.3 billion dollars, which is 23% higher than the same period a year earlier. A large amount of credit organizations in the U.S. were able to earn only in the second quarter of 2007, before the onset of the global financial crisis. It is worth noting that the stability with which American banks manage to increase their own profits - increase performance lasts for the 11th consecutive quarter.
It is noteworthy that the current increase is due to the success of the whole sector, not individual companies. Once 67% of credit institutions were able to improve their financial performance. However the ball is still ruled by the largest representatives of the industry - on banks with assets of more than $ 10 billion fell 81% of earnings for the quarter of funds, although these organizations account for only 1.4% of all U.S. companies in the sector.
However, with the greatest pride in the FDIC reported a decrease in the number of "problem" banks. By the end of the first quarter in this category carried the 772 organizations FDIC bank, the bank has a 41 fewer than at the end of 2011. The decline was due to the improvement in bank balance sheets - fail during this time had only 16 banks. Reduction in the number of bankruptcies occurring the fourth consecutive quarter, has played into the hands of the very FDIC, which was able to increase its assets immediately to $ 3.5 billion, to 15.3 billion dollars
True, a barrel of honey in the form of higher profit was slightly marred fly in the ointment. Actively lending to legal entities (the growth of loans to 14%), banks are still reluctant to deal with private clients. FDIC has documented the decline in consumer credit, and in the most important areas - mortgages and credit cards. "This trend is mainly due to macroeconomic factors - the country's still-high unemployment rate, many of the houses are empty," - said RBC daily EIU analyst Steven Leslie. In his opinion, this is not the only problem the sector. "Banks can not increase profits for a long time without massive cost reduction and investment in technological component of the business. Previously, they could avoid this by increasing the value of their services, but now the regulators are very tough on this. Given the significant change in the law, to end the year as well as it began, U.S. banks will be extremely difficult, "- said Mr. Leslie