The FDIC Quarterly provides a comprehensive summary of the most current financial results for the banking industry, along with feature articles. These articles range from timely analysis of economic and banking trends at the national and regional level that may affect the risk exposure of FDIC-insured institutions to research on issues affecting the banking system and the development of regulatory policy. The FDIC Quarterly brings together data and analysis that were previously available through three retired publications -- the FDIC Outlook, the FDIC Banking Review, and the FYI: An Update on Emerging Issues in Banking. Past issues of these publications are archived under their original publication names.
FDIC-insured institutions reported aggregate net income of $36 billion in the third quarter of 2013, a $1.5 billion (3.9 percent) decline from the $37.5 billion in profits that the industry reported a year earlier. This is the first time in 17 quarters-since the second quarter of 2009-that earnings registered a year-over-year decline. The earnings decline was mainly attributable to a $4 billion increase in litigation expenses at one institution. Lower revenue from reduced mortgage activity and lower gains on asset sales also contributed to the reduction in earnings. Half of the 6,891 insured institutions reporting had year-over-year growth in earnings, while half reported declines. The proportion of banks that were unprofitable fell to 8.6 percent, from 10.7 percent a year earlier.
Insurance Fund Indicators
Estimated insured deposit growth was flat in the third quarter of 2013. The DIF reserve ratio was 0.68 percent at September 30, 2013, up from 0.64 percent at June 30, 2013, and 0.35 percent at September 30, 2012. Six FDIC-insured institutions failed during the quarter.
This paper updates the 2012 FDIC Community Banking Study to reflect developments in the structure and performance of U.S. community banks through the end of 2012. It finds that while the community banking sector changed little in structural terms during the year, community banks showed continued improvement in financial performance following the disruptions associated with the recent financial crisis. Problem loans and failures declined among community banks in 2012, while their pretax profitability was the highest since 2007. While community banks hold just 14 percent of industry assets, they make up almost 95 percent of all U.S. banking organizations. The sector continues to hold nearly half of the industry's small loans to farms and businesses, as well as the majority of deposits in U.S. rural and micropolitan counties.