Journal Article

Profits and balance sheet developments at U.S. commercial banks in 1995

Abstract: Continued profitability and rapid growth of assets combined to lift net income of U.S. commercial banks almost 10 percent in 1995 to a record $49 billion. Profitability, as measured by either return on assets or return on equity, edged up near the peak level posted in 1993. Although net interest income as a share of average assets fell slightly, the decline was more than offset by a decline in net noninterest expense. Provisioning for loan and lease losses edged up, as did charge-offs, but both remained quite low. With delinquency rates for real estate and business loans declining, overall loan quality continued to be very good, even though delinquency rates for consumer loans, particularly credit card loans, rose sharply. Banks retained about one-third of their income, and capital-asset ratios generally remained well above regulatory minimums.

JEL Classification: G21;

https://doi.org/10.17016/bulletin.1996.82-6

Bibliographic Information

Provider: Board of Governors of the Federal Reserve System (U.S.)

Part of Series: Federal Reserve Bulletin

Publication Date: 1996-06

Volume: 82

Issue: Jun