The nation's 11,081 commercial banks earned record profits of $11.45 billion in the July-September quarter and have already exceeded the industry's record for annual profits, the government said Wednesday.
From January through September, banks made $32.6 billion, an improvement of $8.5 billion from the same period a year ago, the Federal Deposit Insurance Corp. said. For all of last year, banks earned $32.1 billion.Andrew C. Hove Jr., acting chairman of the FDIC, attributed the strong earnings to the wide gap between short-term interest rates on deposits and longer-term rates on loans and to the improving economy.
He said it was "probably unrealistic" to expect another year of record earnings in 1994, but he said profits should remain strong.
Lending increased at banks, mostly to consumers, and Hove said banks were in good shape to step up business lending as economic activity strengthens.
The FDIC also said that the country's 2,297 savings institutions and savings banks earned $1.2 billion in the third quarter, that once-troubled industry's eighth consecutive quarter of earnings.
Also, the total assets of the savings industry increased for the first time since 1988.
The list of troubled institutions in both categories - commercial and savings - continued to decline. At the end of September, there were 496 commercial banks and 168 savings institutions, with combined assets of $379 billion, on the FDIC watch list.