North Dakota banks are weathering double-digit growth on the nonperforming loan front, the state's banking commissioner said.
Loans 90 days or more past due shot up 33.3%, to $24 million, in the 12 months ended June in June, said Gary Preszler, commissioner of the North Dakota Department of Banking and Financial Institutions.
The regulator blamed the jump on excessive moisture that has damaged crops in parts of the state over the past few years. Nevertheless, he said, the dollar amounts are still low enough to preclude concern.
"The numbers are growing from a small base," he said. "I don't yet see it as a problem."
T.R. Engen, chief executive of Farmers and Merchants State Bank, said he has seen problems in his portfolio.
"There are a few of them struggling, but farming is up and down all the time," Mr. Engen said.
Farmers and Merchants, a $32 million-asset Tolna-based bank, had a 281% increase in loans 90 days past due in the six months ended June 30, to $814,000. Most of the increase was in commercial and real estate loans.
North Dakota's 127 commercial banks boosted their loan portfolios by 11.3%, to $4.9 billion, during the period, Mr. Preszler said.
Sour real estate loans - both commercial and consumer - drove the increases in delinquency, Mr. Preszler said. Nonperforming real estate loans grew 60% during the period, to $8 million.
Nonperforming construction and industrial loans grew almost as quickly, up 55% to $14 million, Mr. Preszler said.
Nonperforming agricultural loans remained steady at $1 million, he said, adding that crop outlook for parts of the state is better than it has been in the recent past.
Meanwhile, loans that were between 30 days and 89 days past due grew 12.7%, to $71 million, during the same period, he said.
Citizens State Bank of Finely also felt an impact from the climatic conditions. Its nonperforming loans rose from nothing to about $200,000 in the period, said chief executive Roger D. Monson.
The increase represented only two or three loans, Mr. Monson said.
"In 1995 we had nothing in those columns, so any increase would be substantial," Mr. Monson said. "It was due to the conditions caused by the weather."