1-Mar-14
Bank of America earnings up 17% from a year earlier in the fourth quarter of last year , as loan losses fell to the lowest in seven years and the bank set aside less to cover losses and legal fees.
These data provide new evidence of sustained recovery in the banking sector over five years after the financial crisis struck . Nevertheless, the government said the bank continues to have difficulty increase revenue , and rely less set aside for loan losses to increase revenue.
U.S. Federal Deposit Insurance Corporation (FDIC) reported on Wednesday , banking earned $ 40.3 billion in the last quarter of 2013 from $ 34.4 billion in the same period in 2012.
For all of 2013 , banks' earnings increased by 9.6% , the agency called a record of 154.7 one billion annual level. It is a breakthrough in 2006 reached 145.2 billion the previous record profits.
The number on the FDIC 's list of "problem" banks in the third quarter of this year from 515 down to 467 in the last quarter in 2013.
Bank loan losses fell 36.7 percent to 117 billion, a lowest level since the fourth quarter of 2006, the U.S. Federal Deposit Insurance Corporation said . The largest decline came in mortgages , which posted losses of 57.7% of the decline.
FDIC Chairman Martin Gruenberg said the latest results showed " a continuation of the recovery in the banking sector ." In the meantime , he said , the industry still faces challenges, including only modest growth , loans, profit margins narrow and mortgage rising long-term interest rates decline in refinancing loans .
Bank lending rose modestly in the fourth quarter , as it in recent times . Total loans increased $ 90.9 billion, up , or 1.2 percent, from the third quarter of 2013 , marking a 2.1% credit card loans seasonal increase.
Community Bank continues to post significant loans to small business loans , accounting industry , farms and small businesses by 46% , the U.S. Federal Deposit Insurance Corporation said .
James Chessen, chief economist of the American Bankers Association, said loan growth is expected to be strong this year, with growth of about 7% in personal loans , commercial loans increased by about 8%. " Banking is a reflection of the economy ," Chessen said in a statement . "The demand for credit will grow as the creation of new jobs , increase revenue and return on business confidence ."
Bank assets of more than 100 billion driven by a lot of earnings growth during the October to December. Although they make up only 1.5 percent of Bank of America, which accounted for approximately 82% of industry revenues.
These banks include Bank of America , Citigroup, JP Morgan Chase and Wells Fargo & Co. Most of them have been restored with the help of federal bailout funds during the financial crisis and low borrowing rates record .
Last year, the number of bank failures fell to 24 , still higher than normal levels above. In a strong economy, an average of four to five banks close each year. But failure is a significant decline in 51 in 2012, 92 in 2011 and 157 in 2010 - the year in 1992 because of the height of the savings and loan crisis.
In the fourth quarter, the decline in bank failures allowed to continue to strengthen the deposit insurance fund . The fund turned positive by the deficit , the second quarter of 2011 , U.S. $ 47.2 one billion balance on December 31 , according to the U.S. Federal Deposit Insurance Corporation . In contrast to the $ 40.7 billion at the end of September.
U.S. Federal Deposit Insurance Corporation , created during the Great Depression to ensure that the financial position of the bank deposits , monitor and investigate Bank of America .
The agency guarantee bank deposits up to $ 250,000 per account . In addition to its deposit insurance fund , the FDIC also has tens of billions of dollars in reserves .
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