Community and large banks in Pennsylvania, New Jersey and Delaware reported year-over-year growth in profits for the third quarter as loan quality improved and nonperforming loans and charge-offs on bad debt declined, a new report from the Federal Reserve Bank of Philadelphia said.
The Fed Bank noted that while loan quality improved in most banking categories, larger banks saw their loan quality deteriorate somewhat for the second straight quarter in 3Q.
But at large banks, net income for the third quarter grew 3% to $25.3 billion from $24.5 billion a year earlier.
At community banks in the local districts, profits grew by $4.3 billion, or 2.1%. These banks also noted improvements in their loan-loss provisions as loan quality improved and asset sales rose.
Overall, asset quality also has improved within the majority of the banking categories.
The Fed Bank also concluded that real-estate owned properties declined at large banks and community banks nationally, falling 11.8% and 7.1%, respectively. On a local level within the three states, REOs remained mostly flat.
“It should be noted that from the second to the third quarter, REO fell at community banks nationally and was nearly unchanged at local community banks, but it rose at an annualized rate of 5.7 percent at large organizations,” the Federal Reserve Bank of Philadelphia reported.
kpanchuk@housingwire.com
