FDIC REPORTS RECORD PROFITS AT COMMERCIAL BANKS, SAVINGS INSTITUTIONS IN 1993
FOR IMMEDIATE RELEASE
Preliminary data released today by the FDIC show that insured
commercial banks and savings institutions finished 1993 with
another strong quarter and, as expected, record earnings for the
two industries during the year.
Commercial banks earned $43.4 billion during 1993, more than
one-third higher than the previous record of $32.0 billion, set in
1992. Commercial bank earnings during the fourth quarter of 1993
reached $11.1 billion, their second-highest quarterly total ever.
Industry profits for the fourth quarter were $3.4 billion higher
than the same period a year earlier, and just $331 million below
the all-time quarterly record, set in the third quarter of 1993.
Savings institutions insured by the FDIC reported full-year
earnings of $7.0 billion, the highest total ever reported by the
industry. Savings institutions in the fourth quarter had an
aggregate net profit of $1.8 billion, the ninth consecutive
profitable quarter for this group of institutions. These figures
include savings banks and savings and loans but exclude 63
institutions being operated in conservatorship by the Resolution
Trust Corporation and one privately owned thrift that is "self-
Fourth-quarter and full-year 1983 performance results for
10,957 FDIC-insured commercial banks and for 2,264 FDIC-insured
savings institutions are contained in the agency's latest Quarterly
Banking Profile, which is based on quarterly Reports of Condition
and Income filed by FDIC-insured banks and quarterly Thrift
Financial Reports filed by savings institutions regulated by the
Office of Thrift Supervision (OTS). The latest Profile analyzes
trends in banking performance during 1993, with emphasis on the
last quarter of the year.
The annualized return on assets (ROA), a basic yardstick of
bank profitability, averaged 1.21 percent at insured commercial
banks' average RCA was 0.89 percent in the fourth quarter, and 0.93
percent for the full year. This is the first time since the FDIC
was created in 1933 that commercial banks had an ROA over one
percent for a full year.
The strong performance by commercial banks in 1993 was broad-
based. Banks in all six geographic regions and four asset size
groups covered by the Profile averaged ROAs above one percent.
Almost two out of every three by banks reported higher earnings
than a year ago, and over 95 percent of all commercial banks were
The main factors in the record earnings were lower amounts set
aside for loan losses during 1993 than in 1992, and continued
strong margins between the interest income banks earned and the
amounts they paid depositors and other creditors.