WASHINGTON — The nation's banking industry turned a $2.8-billion profit during the third quarter, due in large part to higher net interest income and growth in institutions' securities portfolios, according to figures released by the FDIC.
The agency's Quarterly Banking Profile indicated that fee income was more than three times the $879 million in net income banks reported during the same period one year earlier, and a turnaround from the $4.3 billion in losses banks posted during the second quarter of this year. The average net income margin was 3.51%, leading to a 4.8% rise in net interest income from a year earlier to $4.6 billion. The FDIC reported that securities losses were significantly smaller than the losses from a year earlier, and the growth in noncurrent loans had slowed. Even though noncurrent loans rose by 10.5% in the quarter to $367 billion, it was the smallest increase in the past four quarters.
Still, problems from the lagging recession remain. Net charge-offs and loan loss provisions continued to grow, with loss provisions — totaling $62 billion — exceeding $60 billion for the fourth quarter in a row. The FDIC's list of "problem" institutions also jumped 33% to 552. Assets of institutions on the list grew 15% to $346 billion.
