FDIC: Banks report second-quarter profit of $28.8 billion

WASHINGTON, D.C. – Commercial banks and savings institutions insured by
the Federal Deposit Insurance Corp. reported a profit of $28.8 billion
in the second quarter of 2011, according to the FDIC’s quarterly banking
profile.

Year-over-year, the profit reported by banks increased $7.9 billion,
from $20.9 billion in second-quarter 2010. This is the eighth
consecutive quarter that FDIC-insured institutions nationwide have
reported a year-over-year increase in profit.

Lower provisions for loan losses were responsible for most of the
year-over-year improvement in earnings, according to the release.
Second-quarter loss provisions totaled $19 billion, down from $40.4
billion in second-quarter 2010.

Sixty percent of institutions nationwide reported improvements in their
quarterly net income from a year ago, with only 15.2 percent claiming
net losses for the quarter, down from 20.8 percent in second-quarter
2010.

For the first time since third-quarter 2006, the number of banks on the
FDIC’s “problem list” decreased, from 888 in the first quarter of 2011
to 865 in the second.

The number of institutions that failed in the second quarter also
declined, to 22 from 26 in first quarter 2011. Year to date, 68 banks
have failed nationwide this year, including five in Colorado.