For more information, contact Eric Skrum
608-441-1216 or eskrum@wisbank.com
Bank lending continues to outpace national average; Deposits increase
(MADISON) High unemployment and poor economic conditions contributed to a decline in bank earnings, according to consolidated 3rd quarter performance numbers released today by the Federal Deposit Insurance Corporation (FDIC). But despite the strong economic headwinds, most Wisconsin banks made a profit, total deposits grew and lending again outpaced the national average.
“These numbers clearly reflect the stressed financial conditions of bank customers throughout the state,” commented Kurt R. Bauer, president/CEO of the Wisconsin Bankers Association (WBA). He said Wisconsin banks continue to confront these challenging economic times by working with distressed consumer and business customers and adding to their loan-loss reserves.
“Consolidated bank performance numbers are a snapshot of bank activity between July and September 2009. They are not necessarily a prediction of the future. Nevertheless, bank performance numbers typically lag other economic trends, which means banks could see challenging earnings in the 4th quarter and into 2010.”
At 99 percent, the Wisconsin banking industry’s consolidated loan-to-deposit ratio proves that banks continue to make good loans to qualified borrowers, according to Bauer. “For every dollar deposited in a Wisconsin bank, 99 cents is being lent back into the community,” he explained. Nationally, that same ratio dropped to 80 percent.
Bauer cautioned state and federal policymakers to refrain from making a bad situation worse by enacting laws that hurt banks’ ability to meet loan demand to job creating businesses.
