Chart 6 The banking industry's capacity to absorb losses has climbed to a historically high level. (For all FDIC-insured commercial banks)

Year Capital as a Percent of Total Assets Reserves as a Percent of Total Assets Income (excluding retained earnings) as a Percent of Total Assets
1960 8.05% 0.92% 0.32%
1961 7.97% 0.94% 0.32%
1962 8.02% 0.91% 0.32%
1963 8.08% 0.96% 0.32%
1964 7.72% 1.03% 0.31%
1965 7.53% 1.07% 0.31%
1966 7.44% 1.08% 0.31%
1967 7.10% 1.05% 0.30%
1968 6.90% 1.04% 0.30%
1969 7.18% 1.12% 0.34%
1970 7.12% 1.05% 0.36%
1971 6.95% 0.97% 0.35%
1972 6.62% 0.91% 0.30%
1973 6.53% 0.91% 0.29%
1974 5.71% 0.81% 0.27%
1975 5.88% 0.80% 0.28%
1976 6.11% 0.52% 0.26%
1977 5.92% 0.50% 0.25%
1978 5.80% 0.53% 0.25%
1979 5.75% 0.54% 0.27%
1980 5.80% 0.54% 0.27%
1981 5.83% 0.56% 0.29%
1982 5.87% 0.60% 0.31%
1983 6.00% 0.66% 0.31%
1984 6.14% 0.75% 0.30%
1985 6.19% 0.85% 0.31%
1986 6.19% 0.98% 0.31%
1987 6.02% 1.66% 0.36%
1988 6.28% 1.49% 0.42%
1989 6.21% 1.63% 0.43%
1990 6.45% 1.64% 0.41%
1991 6.75% 1.61% 0.42%
1992 7.51% 1.55% 0.40%
1993 8.00% 1.42% 0.59%
1994 7.78% 1.30% 0.70%
1995 8.11% 1.23% 0.72%
1996 8.20% 1.17% 0.85%
1997 8.33% 1.09% 0.85%
1998 8.49% 1.05% 0.75%
1999 8.36% 1.02% 0.91%
2000 8.49% 1.03% 0.86%
2001 9.06% 1.10% 0.83%
2002 9.15% 1.09% 0.95%
2003 9.10% 1.02% 1.02%
2004 10.10% 0.87% 0.66%

Source: Federal Deposit Insurance Corporation.