Page 7 - Aruba Today

U.S. NEWS A7
Wednesday 24 February

US Financial Front:

American bank earnings jump 11.9% in 4Q; loan losses up

they set aside to cover po- seasonal increase in credit still more than normal. In a
tential losses on loans by card balances and a rise in strong economy, an aver-
45.5 percent, or $3.8 billion, commercial and industrial age of four or five banks
from a year earlier, the FDIC loans. The number of banks closes annually. But failures
reported. That brought the on the FDIC’s “problem list” declined from 24 in 2013
total set aside for the latest fell to 183 from 203 in the and were down sharply
period to $12 billion — the third quarter. from 157 in 2010 — the most
highest level in three years. The number of bank failures in one year since the height
And lending grew by 2.3 continues to slow, mark- of the savings and loan cri-
percent, driven by a mostly ing eight last year. That is sis in 1992.q

A customer uses an ATM at a branch of Chase Bank in New
York. U.S. bank earnings jumped 11.9 percent in the final three
months of 2015 compared with the previous year on rising rev-
enue, and legal expenses declined as some big banks wound
down legal settlements that arose from the financial crisis. Data
issued Tuesday, Feb. 23, 2016, by the Federal Deposit Insurance
Corp. showed that losses from loans increased for the first time
in five and a half years.

(AP Photo/Mark Lennihan)

MARCY GORDON increase in profit from a
AP Business Writer
WASHINGTON (AP) — U.S. year earlier. Only 9.1 per-
bank earnings jumped 11.9
percent in the final three cent of banks were unprof-
months of 2015 compared
with the previous year on itable.
rising revenue. Legal ex-
penses declined as some The number of “problem”
big banks wound down le-
gal settlements that arose banks on the FDIC’s confi-
from the financial crisis.
Nonetheless, data issued dential list fell below 200 for
Tuesday by the Federal
Deposit Insurance Corp. the first time in more than
showed that losses from
loans increased for the seven years, since the fi-
first time in five and a half
years. The increase in loans nancial crisis.
that banks wrote off as un-
collectible was especially FDIC Chairman Martin Gru-
strong — 43.4 percent —
for industrial borrowers as enberg took note of the
plummeting oil prices hurt
energy companies. impact of the steep fall in
The FDIC reported that U.S.
banks earned $40.8 billion oil prices over the past year
in the October-December
quarter, up from $36.4 bil- and a half.
lion a year earlier.
More than half of all banks, “Recently, domestic and
56.6 percent, reported an
international market de-

velopments have led to

heightened concerns

about the U.S. economic

outlook and prospects for

the banking industry,” Gru-

enberg said at a news con-

ference. “Thus far, the per-

formance of the banks has

not been impacted mate-

rially. However, the full ef-

fect of lower energy and

other commodity prices re-

mains to be seen.”

In the fourth quarter, banks

increased the amounts