FDIC Reports Positive Banking System Data
Insured Deposits: While the DIF is down 51.9% since the end of 2007 to $25.2 billion, insured deposits are up 68.9% to $7.25 trillion. As deposits grow the size of DIF must increase, which is another source of stress.
Reserves for Losses: The banking system has been reducing reserves for losses since it peaked at $263.1 billion beginning in Q2 2010. Now at $167.0 billion, reserves remain 64.2% above the level of 2007. This shows that there are additional bad assets that need to be unwound.
30-89 Day Past Due: As real estate loans began to default this category peaked at $157.9 billion in Q1 2009. Since the pace of bad loans has slowed this category has slowed to $87.0 billion in Q3 2012, down 21.6% since the end of 2007.
Noncurrent Loans: The peak in this bad loan category was $405.4 billion at the end of Q1 2010. While significantly lower today at $292.1 billion it's up $182.2 billion, or 165.8% since the end of 2007. This is another sign that the banking system continues to experience the effects of the great credit crunch.In summary, while the banking system has been slowly but surely reducing exposures to bad real estate loans overall stress in the banking system remains. Tomorrow I will update my profiles for several stocks in the money center and regional banking industries.
This article is commentary by an independent contributor, separate from TheStreet's regular news coverage. Follow @Suttmeier
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV