Asia's economic woes could reduce demand for U.S. exports of high technology, aerospace, oil, and agricultural products, the government reported Wednesday.
At the same time, currency devaluations are making Asian exports cheaper, giving them an advantage over U.S. firms' products.
These two trends could make loans to companies in the affected industries risky, according to eight regional reports issued quarterly by the Federal Deposit Insurance Corp. Copies are available through a call to 800-276-6003 or a visit to the agency's Web site (http://www.fdic.gov/banknews).
Though western states will probably be hardest hit by the Asian crisis, the FDIC said reduced demand for agricultural products will affect states in the Upper Midwest and the Southwest and reduced demand for energy could hurt oil-producing states.
"Insured institutions in all eight regions continued to post strong performances and, with few exceptions, are adequately reserved and have strong capital positions," the FDIC said. "Nevertheless, the analysts noted the potential for insured institutions to encounter borrowers under stress in sectors mainly affected by reduced exports to Asia."