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FDIC Banking Review

Table 3.
Differences in Means and Standard Errors of Financial Variables for Pairs
(Standard Errors in Parentheses)
Variable Recover–Merge Recover–Remain a Problem Recover–Fail Merge–Remain a Problem Remain a Problem–Fail Merge–Fail
Capital
Tangible Equity Capital 0.10 0.29** 2.78*** 0.19 2.49*** 2.68***
(0.22) (0.11) (0.30) (0.22) (0.29) (0.35)
Capital Injections:
From BHC -0.22*** (0.01) 0.04 0.21*** 0.05 0.26**
(0.06) (0.03) (0.08) (0.06) (0.08) (0.10)
Outside 0.07 0.08 (0.06) 0.00 -0.14 -0.13
(0.10) (0.05) (0.13) (0.10) (0.13) (0.16)
Asset Quality
Past-Due Loans (30 - 89 days) -0.24** -0.55*** -1.20*** -0.31** -0.65*** -0.96***
(0.11) (0.05) (0.15) (0.11) (0.15) (0.18)
Past-Due Loans (90+ days) -0.06 -0.33*** -0.58*** -0.27** -0.25* -0.52***
(0.10) (0.05) (0.13) (0.10) (0.13) (0.16)
Nonaccrual Loans and Leases -0.39** -0.47*** -1.65*** -0.09 -1.18*** -1.27***
(0.15) (0.07) (0.20) (0.15) (0.20) (0.24)
Other Real Estate Owned 0.12 -0.59*** -1.19*** -0.72*** -0.59** -1.31***
(0.18) (0.09) (0.24) (0.18) (0.24) (0.29)
Allowance for Loan Loss -0.29*** -0.04 -0.42*** 0.25** -0.38*** -0.13
(0.08) (0.04) (0.11) (0.08) (0.11) (0.13)
Management
Efficiency Ratio -5.83*** -6.10*** -27.44*** -0.28 -21.34*** -21.62***
  (1.76) (0.86) (2.37) (1.71) (2.34) (2.79)
Earnings
Total Interest Income -0.19 -0.79*** -1.78*** -0.60** -0.99*** -1.59***
  (0.22) (0.11) (0.30) (0.22) (0.30) (0.36)
Total Noninterest Income -0.03 -0.04 -0.57** -0.01 -0.53** -0.54**
  (0.17) (0.08) (0.22) (0.16) (0.22) (0.26)
Total Interest Expense -0.03 -0.79*** -2.03*** -0.76*** -1.24*** -2.00***
  (0.15) (0.07) (0.21) (0.15) (0.20) (0.24)
Loan-Loss Provision -0.88*** -0.46*** -1.85*** 0.42** -1.40*** -0.97***
  (0.17) (0.08) (0.23) (0.17) (0.23) (0.27)
Loan Charge-offs -0.32** -0.33*** -1.39*** -0.02 -1.06*** -1.08***
  (0.13) (0.07) (0.18) (0.13) (0.18) (0.21)
Expenses on Premises -0.07** -0.09*** -0.28*** -0.02 -0.19*** -0.21***
  (0.03) (0.02) (0.04) (0.03) (0.04) (0.05)
Salaries -0.03 -0.12** -0.50*** -0.09 -0.38*** -0.48***
  (0.08) (0.04) (0.11) (0.08) (0.11) (0.13)
Other Non-interest Expenses -0.30** -0.20*** -1.06*** 0.11 -0.86*** -0.76***
  (0.12) (0.06) (0.16) (0.12) (0.16) (0.19)
Liquidity
Volatile Liabilities -0.36 -1.70*** -1.78* -1.34* -0.09 -1.43
  (0.70) (0.35) (0.95) (0.69) (0.94) (1.12)
Loans + Securities > Five Years -1.98** -2.57*** -1.91* -0.60 0.66 0.07
  (0.82) (0.40) (1.11) (0.80) (1.09) (1.31)
Significance at 1%, 5% and 10% levels are indicated by ***, **, and * asterisks, respectively.



Last Updated 1/19/2006 Questions, Suggestions & Requests