QUARTERLY BANKING PROFILE Second Quarter 2016

FDIC QUARTERLY 1

INSURED INSTITUTION PERFORMANCE

Net Income Rises 1.4 Percent to $43.6 Billion

Strong Loan Growth Provides a Lift to Revenues

Lower Charges for Litigation, Goodwill Impairment Limit Noninterest Expense Growth

Noncurrent C&I Loans Increase Again, Total Noncurrent Balances Fall

Loan-Loss Provisions Rise as Industry Builds Reserves

Earnings Improvement 

Is Broad-Based

Expanding loan portfolios generated higher levels of net interest income, helping lift the 

total earnings of FDIC-insured commercial banks and savings institutions to $43.6 billion 

in second quarter 2016. Industry net income was $584 million (1.4 percent) higher than 

in second quarter 2015. The average return on assets (ROA) was 1.06 percent, down from 

1.09 percent the year before, as asset growth outpaced the increase in quarterly net income. 

More than half of all banks—60.1 percent—reported higher quarterly earnings compared 

with the year-earlier quarter, while the percentage of banks reporting negative quarterly net 

income fell to 4.5 percent, from 5.8 percent in second quarter 2015.

Net Interest Income 

Accounts for Most of the 

Growth in Revenue

Net operating revenue—the sum of net interest income and total noninterest income—totaled 

$179.3 billion in the second quarter, an increase of $5.8 billion (3.3 percent) from the yearearlier quarter. Net interest income was up $5.2 billion (4.8 percent), as average interestbearing assets were 4.4 percent higher than second quarter 2015. The average net interest 

margin of 3.08 percent was almost unchanged from the 3.07 percent average in second quarter 

2015. Noninterest income was $600 million (0.9 percent) higher than the year before. Trading 

income rose $1.4 billion (24.9 percent), while servicing income fell by $3.4 billion (74.4 percent).

Noninterest Expenses 

Decline at Many 

Large Banks

Noninterest expenses totaled $104.8 billion, an increase of only $271 million (0.3 percent) from 

the year-earlier quarter, as nonrecurring charges at several large banks declined by more than 

$1.2 billion. In second quarter 2015, three large banks reported itemized litigation expenses 

totaling $508 million. In the most recent quarter, one bank reported a $473 million release of 

litigation reserves (a negative litigation expense), so the year-over-year reduction in litigation 

charges was $981 million. In addition, charges for goodwill impairment were $278 million 

lower than the year before. The declines in these noninterest expense items almost canceled 

out a $1.4 billion (2.8 percent) year-over-year increase in salary and employee benefit expenses. 

Eight of the ten largest banks reported year-over-year declines in their total noninterest 

expenses, but for the industry as a whole, only 30 percent reported lower noninterest expenses.

Securities and Other Gains/Losses, Net

Net Operating Income

Quarterly Net Income

All FDIC-Insured Institutions

$ Billions

Source: FDIC.

-20

-10

0

10

20

30

40

50

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 412 3 4 1 2

2010 2011

17.4

20.9 23.8 21.4

28.7

2012

28.5

35.2

25.3

34.8

2013

34.5

37.5 34.4

2014

40.3 38.2 36.1

39.8 37.3

2015

40.1 38.5 36.5

2016

39.8

43.0 40.4 40.7 39.0

43.6

Chart 1

Quarterly Noninterest Income 

Quarterly Net Interest Income 

Quarterly Net Operating Revenue 

All FDIC-Insured Institutions

$ Billions

Source: FDIC.

0

20

40

60

80

100

120

140

160

180

200

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Chart 2
2 0 1 6  •Volume 1 0  • Number 3

2 FDIC QUARTERLY

Loan-Loss Provisions Rise 

for the Eighth Consecutive 

Quarter

Banks set aside $11.8 billion in loan-loss provisions in the second quarter, an increase of 

$3.6 billion (44.2 percent) compared with second quarter 2015. More than a third of all 

banks—38.7 percent—reported higher loss provisions than in second quarter 2015. This is the 

eighth quarter in a row that quarterly loss provisions have posted a year-over-year increase.

Charge-Offs of C&I Loans 

Post Further Increase

Net loan and lease charge-offs were higher than the year before for the third consecutive 

quarter. Charge-offs totaled $10.1 billion, a $1.2 billion (13.1 percent) increase over second 

quarter 2015. Fewer than half of all banks—44.9 percent—reported year-over-year increases 

in their quarterly net charge-offs. Most of the increase occurred in loans to commercial and 

industrial (C&I) borrowers. C&I net charge-offs rose to $2.2 billion from $1.1 billion a year 

earlier, an increase of $1.1 billion (100.3 percent). This is the fifth consecutive quarter that 

C&I charge-offs have been higher than the year-earlier quarter. Banks reported smaller 

year-over-year increases in credit cards, auto loans, and agricultural production loans. The 

average net charge-off rate rose to 0.45 percent, from 0.42 percent in second quarter 2015.

Total Noncurrent Loan 

Balances Decline, Although 

Noncurrent C&I Loans Rise

The amount of loans and leases that were noncurrent—90 days or more past due or in 

nonaccrual status—declined by $4.8 billion (3.4 percent) during the second quarter. 

Noncurrent C&I loans increased for a sixth consecutive quarter, rising by $2.1 billion 

(8.9 percent), but all other major loan categories registered quarterly declines in noncurrent 

balances. The average noncurrent rate declined from 1.58 percent to 1.49 percent during the 

quarter. This is the lowest noncurrent rate for the industry since year-end 2007.

Banks Continue to Build 

Their Reserves

Insured institutions increased their reserves for loan losses by $1 billion (0.8 percent) during 

the quarter, as the $11.8 billion in loss provisions added to reserves exceeded the $10.1 billion 

in net charge-offs subtracted from reserves. Banks with assets greater than $1 billion, 

which also report their reserves for specific loan categories, increased their total reserves by 

$987 million (0.9 percent). The largest increase was in reserves for credit card losses, which 

increased by $1.3 billion (4.7 percent). They also increased their reserves for commercial 

loan losses by $787 million (2.2 percent), while reducing their reserves for residential real 

estate losses by $1.1 billion (5.1 percent). The increase in total reserves, combined with the 

reduction in total noncurrent loan balances, lifted the average coverage ratio of reserves to 

Quarterly Net Interest Margin

Source: FDIC.

Percent

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

2010 2011 2012 2013 2014 2015 2016

All FDIC-Insured Institutions

 Assets > $250 Billion

 Assets $10 Billion - $250 Billion

 Assets $1 Billion - $10 Billion

 Assets $100 Million - $1 Billion

 Assets < $100 Million

Chart 3

Year-Over-Year Change in Quarterly Loan-Loss Provisions

All FDIC-Insured Institutions

Source: FDIC.

-35

-30

-25

-20

-15

-10

-5

0

5

10

$ Billions

3.6

-30.7

123412 34123 412341 2 341 2

2011 2012 2013 2014 2015 2016

Chart 4
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 3

noncurrent loans from 85.5 percent to 89.2 percent during the quarter. The increase in 

reserves did not keep pace with the growth in total loan balances, however, as the average 

reserve ratio of reserves to total loans and leases fell from 1.35 percent to 1.33 percent. This 

is the 23rd time in the last 24 quarters that the industry’s reserve ratio has declined, and it is 

now at its lowest level since year-end 2007.

Internal Capital 

Generation Grows

Equity capital increased by $30.4 billion (1.7 percent) in the quarter, as retained earnings 

contributed $20.4 billion to capital growth and an increase in the market values of securities portfolios added to total equity. Retained earnings were $6.7 billion (49.2 percent) 

higher than the year before, as banks reduced their quarterly dividends by $6.1 billion 

(20.9 percent), compared with second quarter 2015 levels. Accumulated other comprehensive income, which includes changes in the values of banks’ available-for-sale securities, 

increased by $9.7 billion during the quarter. At the end of the second quarter, more than 

99 percent of all banks, representing 99.9 percent of total industry assets, met or exceeded the 

requirements for well-capitalized banks as defined for Prompt Corrective Action purposes.

Loan Growth 

Remains Strong

Total assets increased by $240.6 billion (1.5 percent) during the quarter. Total loan and lease 

balances rose by $181.9 billion (2 percent). The largest increases occurred in residential mortgages (up $42.4 billion, 2.2 percent), real estate loans secured by nonfarm nonresidential 

properties (up $26.9 billion, 2.1 percent), credit card balances (up $22.3 billion, 3.1 percent), 

and loans to nondepository financial institutions (up $19.8 billion, 6.9 percent). All major 

loan categories saw increases in balances outstanding during the second quarter. For the 

12 months ended June 30, total loans and leases increased 6.7 percent, down slightly from 

6.9 percent for the 12 months ended March 31. In addition to the growth in loan balances, 

banks increased their unfunded loan commitments by $36.4 billion (0.5 percent). This is 

the smallest quarterly increase in unfunded commitments since fourth quarter 2013. For a 

second consecutive quarter, unfunded commitments to make C&I loans declined, falling by 

$24.1 billion (1.3 percent). Banks’ investments in securities rose by $36.1 billion (1.1 percent), 

with $28.7 billion of the growth coming from increased holdings of mortgage-backed securities. Balances with Federal Reserve banks declined by $90.6 billion (7.2 percent).

Source: FDIC.

Percentage

Noncurrent Loan Rate and Quarterly Net Charge-O
 Rate

All FDIC-Insured Institutions

0

1

2

3

4

5

6

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Noncurrent Loan Rate

Quarterly Net Charge-O Rate

Chart 5

Quarterly Change in Loan Balances

All FDIC-Insured Institutions

$ Billions

146

196

108

6643

189

237

203

61

28

-6

-109

-210

-133

-107

-7

-126

67

24

134

-63

102

65

118

-37

74 70 91

38

178

51

149

53

185

95

197

100

182

-116

-140

221*

-14

-250

-200

-150

-100

-50

0

50

100

150

200

250

300

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Source: FDIC.

*FASB Statements 166 and 167 resulted in the consolidation of large amounts of securitized loan balances

back onto banks’ balance sheets in the rst quarter of 2010. Although the total amount consolidated

cannot be precisely quantied, the industry would have reported a decline in loan balances for the

quarter absent this change in accounting standards. 

Chart 6
2 0 1 6  •Volume 1 0  • Number 3

4 FDIC QUARTERLY

Banks Increase Borrowings 

From Federal Home Loan 

Banks

Nondeposit liabilities funded a larger share of asset growth than deposits in the second quarter. These borrowings rose by $111.7 billion (5.5 percent), as advances from Federal Home 

Loan Banks increased by $64.4 billion (13.4 percent). Total deposits increased by $98.6 billion 

(0.8 percent). Deposits in domestic offices rose by $94.8 billion (0.9 percent), while foreign 

office deposits increased $3.8 billion (0.3 percent). Interest-bearing domestic office deposits were up $52.2 billion (0.6 percent), while balances in noninterest-bearing accounts rose 

by $42.5 billion (1.4 percent). At banks that offer consumer deposit accounts (checking or 

savings accounts intended primarily for individuals for personal, household, or family use), 

balances in these accounts declined by $13 billion (0.3 percent) during the quarter. At banks 

with assets greater than $1 billion that offer consumer accounts, quarterly service charge 

income on these accounts increased by $35 million (0.8 percent) from the year before.

‘Problem List’ Shrinks to 

147 Institutions

The number of FDIC-insured commercial banks and savings institutions reporting quarterly 

financial results declined to 6,058 from 6,122 in the second quarter. During the quarter, 

mergers absorbed 57 insured institutions, two banks failed, and no new charters were added. 

The number of banks on the FDIC’s “Problem List” declined from 165 to 147, and total assets 

of problem banks fell from $30.9 billion to $29 billion. This is the smallest number of problem banks in eight years. Banks reported 2,045,221 full-time equivalent employees in the 

quarter, an increase of 5,302 compared with the first quarter, and 2,816 more than in second 

quarter 2015.

Author:

Ross Waldrop

Senior Banking Analyst

Division of Insurance and Research

(202) 898-3951

Quarterly Change in Asset Funding

All FDIC-Insured Institutions

$ Billions

Source: FDIC.

-500

-400

-300

-200

-100

0

100

200

300

400

500

Equity Capital

Nondeposit Liabilities

Deposits

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Chart 7

Source: FDIC.

Assets ($ Billions) Number

Number and Assets of Banks on the “Problem List”

0

50

100

150

200

250

300

350

400

450

500

0

100

200

300

400

500

600

700

800

900

1,000

29

147

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Chart 8
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 5

TABLE I-A. Selected Indicators, All FDIC-Insured Institutions*

2016** 2015** 2015 2014 2013 2012 2011

Return on assets (%) 1.02 1.06 1.04 1.01 1.07 1.00 0.88

Return on equity (%) 9.05 9.45 9.30 9.01 9.54 8.90 7.79

Core capital (leverage) ratio (%) 9.57 9.53 9.59 9.44 9.40 9.15 9.07

Noncurrent assets plus other real estate owned to assets (%) 0.91 1.04 0.96 1.20 1.63 2.20 2.61

Net charge-offs to loans (%) 0.45 0.43 0.44 0.49 0.69 1.10 1.55

Asset growth rate (%) 4.95 3.83 2.66 5.59 1.94 4.02 4.30

Net interest margin (%) 3.10 3.05 3.07 3.14 3.26 3.42 3.60

Net operating income growth (%) -0.25 6.57 7.14 -0.73 12.82 17.76 43.60

Number of institutions reporting 6,058 6,348 6,182 6,509 6,812 7,083 7,357

Commercial banks 5,238 5,474 5,338 5,607 5,847 6,072 6,275

Savings institutions 820 874 844 902 965 1,011 1,082

Percentage of unprofitable institutions (%) 4.29 5.12 4.74 6.27 8.16 11.00 16.23

Number of problem institutions 147 228 183 291 467 651 813

Assets of problem institutions (in billions) $29 $57 $47 $87 $153 $233 $319

Number of failed institutions 3 5 8 18 24 51 92

Number of assisted institutions 0 0 0 0 0 0 0

* Excludes insured branches of foreign banks (IBAs).

** Through June 30, ratios annualized where appropriate. Asset growth rates are for 12 months ending June 30.

TABLE II-A. Aggregate Condition and Income Data, All FDIC-Insured Institutions

(dollar figures in millions)  2nd Quarter

2016

1st Quarter

2016

2nd Quarter

2015

%Change 

15Q2-16Q2

Number of institutions reporting 6,058 6,122 6,348 -4.6

Total employees (full-time equivalent) 2,045,221 2,039,919 2,042,405 0.1

CONDITION DATA

Total assets $16,533,991 $16,293,429 $15,753,656 5.0

Loans secured by real estate 4,505,917 4,419,248 4,260,902 5.8

 1-4 Family residential mortgages 1,960,972 1,918,540 1,880,062 4.3

 Nonfarm nonresidential 1,278,405 1,251,520 1,175,800 8.7

 Construction and development 294,140 284,319 255,755 15.0

 Home equity lines 452,283 457,506 477,908 -5.4

Commercial & industrial loans 1,931,539 1,913,281 1,798,583 7.4

Loans to individuals 1,515,160 1,474,249 1,422,679 6.5

 Credit cards 745,935 723,659 701,190 6.4

Farm loans 79,101 77,616 76,350 3.6

Other loans & leases 1,091,400 1,056,859 990,360 10.2

Less: Unearned income 2,106 2,109 1,925 9.4

Total loans & leases 9,121,010 8,939,145 8,546,949 6.7

Less: Reserve for losses 121,682 120,659 119,646 1.7

Net loans and leases 8,999,328 8,818,486 8,427,303 6.8

Securities 3,420,720 3,384,656 3,278,017 4.4

Other real estate owned 13,153 14,047 17,513 -24.9

Goodwill and other intangibles 359,615 359,132 359,999 -0.1

All other assets 3,741,176 3,717,108 3,670,824 1.9

Total liabilities and capital 16,533,991 16,293,429 15,753,656 5.0

Deposits 12,528,037 12,429,486 11,932,441 5.0

 Domestic office deposits 11,201,194 11,106,441 10,586,399 5.8

 Foreign office deposits 1,326,842 1,323,045 1,346,042 -1.4

Other borrowed funds 1,457,660 1,379,952 1,430,710 1.9

Subordinated debt 88,573 91,743 92,571 -4.3

All other liabilities 589,153 551,982 522,237 12.8

Total equity capital (includes minority interests) 1,870,569 1,840,266 1,775,698 5.3

 Bank equity capital 1,864,232 1,833,866 1,768,829 5.4

Loans and leases 30-89 days past due 58,022 58,602 59,144 -1.9

Noncurrent loans and leases 136,383 141,192 144,688 -5.7

Restructured loans and leases 69,626 71,106 76,930 -9.5

Mortgage-backed securities 1,924,278 1,895,559 1,787,493 7.7

Earning assets 14,833,260 14,653,710 14,110,623 5.1

FHLB Advances 545,607 481,183 473,738 15.2

Unused loan commitments 7,072,101 7,035,660 6,734,282 5.0

Trust assets 17,381,472 16,870,847 17,774,375 -2.2

Assets securitized and sold 785,857 803,719 869,198 -9.6

Notional amount of derivatives 192,349,432 195,508,514 201,613,096 -4.6

INCOME DATA

First Half 

2016

First Half 

2015 %Change

2nd Quarter 

2016

2nd Quarter 

2015

%Change 

15Q2-16Q2

Total interest income $251,856 $237,110 6.2 $126,869 $120,064 5.7

Total interest expense 26,191 23,362 12.1 13,385 11,789 13.5

Net interest income 225,666 213,748 5.6 113,484 108,276 4.8

Provision for loan and lease losses 24,295 16,520 47.1 11,764 8,157 44.2

Total noninterest income 126,201 127,785 -1.2 65,805 65,205 0.9

Total noninterest expense 209,401 207,856 0.7 104,843 104,572 0.3

Securities gains (losses) 2,300 2,060 11.6 1,363 754 80.7

Applicable income taxes 37,492 36,196 3.6 20,151 18,379 9.6

Extraordinary gains, net -206 76 N/M -197 33 N/M

Total net income (includes minority interests) 82,773 83,097 -0.4 43,698 43,160 1.2

 Bank net income 82,597 82,799 -0.2 43,600 43,015 1.4

Net charge-offs 20,235 17,946 12.8 10,114 8,942 13.1

Cash dividends 43,742 51,639 -15.3 23,219 29,353 -20.9

Retained earnings 38,855 31,160 24.7 20,381 13,663 49.2

Net operating income 81,366 81,570 -0.3 42,945 42,601 0.8

N/M - Not Meaningful
2 0 1 6  •Volume 1 0  • Number 3

6 FDIC QUARTERLY

TABLE III-A. Second Quarter 2016, All FDIC-Insured Institutions

Asset Concentration Groups*

SECOND QUARTER

(The way it is...)

All Insured 

Institutions

Credit 

Card 

Banks

International 

Banks

Agricultural 

Banks

Commercial 

Lenders

Mortgage 

Lenders

Consumer 

Lenders

Other 

Specialized 

<$1 Billion

All Other 

<$1 Billion

All Other 

>$1 Billion

Number of institutions reporting 6,058 13 4 1,466 3,031 493 63 322 603 63

Commercial banks 5,238 12 4 1,449 2,726 119 50 292 531 55

Savings institutions 820 1 0 17 305 374 13 30 72 8

Total assets (in billions) $16,534.0 $501.9 $3,966.6 $270.7 $5,986.7 $396.6 $200.8 $56.1 $103.7 $5,050.8

Commercial banks 15,425.6 437.3 3,966.6 264.9 5,533.6 153.1 97.6 49.9 90.1 4,832.5

Savings institutions 1,108.3 64.6 0.0 5.8 453.1 243.5 103.2 6.2 13.6 218.3

Total deposits (in billions) 12,528.0 286.3 2,807.0 222.7 4,650.0 314.9 168.6 44.9 87.4 3,946.3

Commercial banks 11,660.2 236.8 2,807.0 219.5 4,316.7 126.6 81.6 40.6 76.2 3,755.1

Savings institutions 867.8 49.5 0.0 3.1 333.3 188.2 87.0 4.3 11.2 191.2

Bank net income (in millions) 43,600 2,809 9,485 829 15,768 934 483 354 244 12,694

Commercial banks 39,868 2,469 9,485 812 13,739 489 281 170 222 12,201

Savings institutions 3,731 340 0 18 2,029 445 201 184 22 493

Performance Ratios (annualized, %)

Yield on earning assets 3.45 11.24 2.73 4.16 3.69 3.24 4.07 3.05 3.93 2.85

Cost of funding earning assets 0.36 1.16 0.36 0.47 0.39 0.45 0.45 0.33 0.40 0.23

Net interest margin 3.08 10.08 2.37 3.69 3.30 2.79 3.62 2.72 3.52 2.62

Noninterest income to assets 1.61 2.76 1.82 0.67 1.47 0.98 1.52 6.09 0.89 1.55

Noninterest expense to assets 2.56 5.45 2.27 2.54 2.77 2.26 2.88 5.20 2.95 2.22

Loan and lease loss provision to assets 0.29 3.17 0.18 0.17 0.18 -0.02 0.58 0.04 0.09 0.24

Net operating income to assets 1.05 2.27 0.96 1.20 1.06 0.92 0.96 2.44 0.90 0.97

Pretax return on assets 1.56 3.40 1.44 1.45 1.52 1.42 1.52 3.44 1.17 1.51

Return on assets 1.06 2.27 0.96 1.23 1.06 0.95 0.96 2.53 0.94 1.01

Return on equity 9.45 15.24 9.68 10.71 8.97 8.23 9.52 16.68 7.93 9.07

Net charge-offs to loans and leases 0.45 3.28 0.55 0.16 0.22 0.06 0.64 0.20 0.16 0.40

Loan and lease loss provision to 

net charge-offs 116.31 127.39 92.75 152.10 116.57 -46.45 128.42 71.95 106.28 121.17

Efficiency ratio 57.74 44.55 57.97 61.31 61.42 62.21 57.23 60.45 70.76 55.73

% of unprofitable institutions 4.49 0.00 0.00 3.00 3.99 9.13 4.76 7.45 5.64 1.59

% of institutions with earnings gains 60.14 30.77 50.00 57.78 63.44 56.59 52.38 52.80 57.21 63.49

Structural Changes

New reporters 0 0 0 0 0 0 0 0 0 0

Institutions absorbed by mergers 57 0 0 10 41 3 1 0 2 0

Failed institutions 2 0 0 0 2 0 0 0 0 0

PRIOR SECOND QUARTERS

(The way it was...)

Return on assets (%) 2015 1.09 2.89 0.94 1.21 0.96 0.92 1.21 0.33 1.02 1.17

 2013 1.06 3.27 1.03 1.21 0.79 1.07 1.68 1.79 0.95 1.05

 2011 0.85 3.96 0.46 1.12 0.71 0.55 1.67 1.94 0.80 0.80

Net charge-offs to loans & leases (%) 2015 0.42 2.80 0.57 0.12 0.17 0.13 0.58 0.20 0.19 0.39

 2013 0.73 3.38 1.05 0.14 0.46 0.41 1.07 0.45 0.38 0.48

 2011 1.59 5.58 1.43 0.37 1.27 1.03 1.79 0.41 0.48 1.24

* See Table V-A (page 10) for explanations.
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 7

TABLE III-A. Second Quarter 2016, All FDIC-Insured Institutions 

Asset Size Distribution Geographic Regions*

SECOND QUARTER

(The way it is...)

All Insured 

Institutions

Less Than 

$100 

Million

$100 

Million to 

$1 Billion

$1 Billion 

to $10 

Billion

$10 Billion 

to $250 

Billion

Greater 

Than $250 

Billion

New 

York Atlanta Chicago

Kansas 

City Dallas

San 

Francisco

Number of institutions reporting 6,058 1,637 3,690 619 102 10 739 743 1,305 1,519 1,292 460

Commercial banks 5,238 1,441 3,196 505 86 10 382 672 1,090 1,462 1,211 421

Savings institutions 820 196 494 114 16 0 357 71 215 57 81 39

Total assets (in billions) $16,534.0 $96.7 $1,173.6 $1,724.0 $4,897.6 $8,642.0 $3,127.8 $3,467.9 $3,692.0 $3,604.0 $976.1 $1,666.2

Commercial banks 15,425.6 85.5 993.4 1,417.5 4,287.2 8,642.0 2,699.3 3,383.5 3,581.2 3,547.4 856.4 1,357.8

Savings institutions 1,108.3 11.2 180.2 306.6 610.4 0.0 428.5 84.4 110.8 56.6 119.7 308.4

Total deposits (in billions) 12,528.0 81.0 972.4 1,358.6 3,713.8 6,402.3 2,347.0 2,693.6 2,686.1 2,676.3 797.7 1,327.4

Commercial banks 11,660.2 72.3 829.9 1,127.8 3,227.9 6,402.3 2,027.0 2,625.8 2,606.2 2,632.0 699.2 1,070.0

Savings institutions 867.8 8.6 142.5 230.8 486.0 0.0 320.0 67.8 79.9 44.3 98.5 257.3

Bank net income (in millions) 43,600 224 3,199 4,541 13,624 22,013 6,968 8,239 9,232 10,124 2,676 6,360

Commercial banks 39,868 197 2,736 3,972 10,951 22,013 6,242 8,073 8,900 10,008 2,345 4,299

Savings institutions 3,731 27 463 569 2,672 0 726 166 332 116 331 2,061

Performance Ratios (annualized, %)

Yield on earning assets 3.45 4.12 4.14 4.02 3.97 2.92 3.50 3.47 2.80 3.60 3.96 4.05

Cost of funding earning assets 0.36 0.43 0.46 0.42 0.45 0.29 0.44 0.30 0.30 0.41 0.32 0.39

Net interest margin 3.08 3.69 3.68 3.60 3.52 2.63 3.05 3.17 2.50 3.19 3.64 3.66

Noninterest income to assets 1.61 1.17 1.20 1.22 1.61 1.74 1.38 1.48 1.93 1.39 1.44 2.14

Noninterest expense to assets 2.56 3.42 3.16 2.82 2.67 2.35 2.53 2.58 2.51 2.39 3.11 2.73

Loan and lease loss provision to assets 0.29 0.12 0.12 0.22 0.47 0.22 0.31 0.37 0.15 0.28 0.25 0.43

Net operating income to assets 1.05 0.88 1.06 1.05 1.12 1.00 0.90 0.93 1.01 1.09 1.08 1.56

Pretax return on assets 1.56 1.08 1.38 1.52 1.69 1.52 1.27 1.41 1.50 1.64 1.44 2.40

Return on assets 1.06 0.93 1.10 1.07 1.12 1.03 0.90 0.96 1.01 1.13 1.10 1.54

Return on equity 9.45 7.20 9.62 9.08 9.22 9.68 7.49 7.75 9.80 11.18 9.90 12.68

Net charge-offs to loans and leases 0.45 0.19 0.12 0.21 0.62 0.46 0.46 0.53 0.27 0.52 0.31 0.54

Loan and lease loss provision to 

net charge-offs 116.31 106.44 153.40 151.57 121.43 104.64 121.35 120.92 111.83 100.66 124.85 129.14

Efficiency ratio 57.74 74.70 68.08 61.58 54.78 57.05 60.79 58.89 60.12 55.17 64.61 48.51

% of unprofitable institutions 4.49 9.90 2.76 1.13 0.98 0.00 6.36 6.19 5.44 3.23 2.94 4.57

% of institutions with earnings gains 60.14 54.18 61.95 64.78 62.75 50.00 59.81 62.45 61.23 58.13 59.60 61.96

Structural Changes

New reporters 0 0 0 0 0 0 0 0 0 0 0 0

Institutions absorbed by mergers 57 18 31 8 0 0 9 8 20 9 7 4

Failed institutions 2 1 1 0 0 0 1 0 0 0 1 0

PRIOR SECOND QUARTERS

(The way it was...)

Return on assets (%) 2015 1.09 0.95 0.97 1.31 1.04 1.10 0.96 1.10 0.96 1.23 1.15 1.29

 2013 1.06 0.77 0.95 1.27 0.88 1.17 0.54 1.02 1.12 1.28 1.17 1.60

 2011 0.85 0.53 0.53 0.93 1.19 0.64 1.20 0.44 0.71 1.23 0.87 0.83

Net charge-offs to loans & leases (%) 2015 0.42 0.14 0.14 0.21 0.55 0.45 0.49 0.47 0.25 0.50 0.21 0.49

 2013 0.73 0.35 0.37 0.43 0.97 0.72 1.00 0.70 0.48 0.95 0.34 0.58

 2011 1.59 0.63 0.91 1.22 2.18 1.37 1.81 1.69 1.30 1.84 0.96 1.53

* See Table V-A (page 11) for explanations.
2 0 1 6  •Volume 1 0  • Number 3

8 FDIC QUARTERLY

TABLE IV-A. First Half 2016, All FDIC-Insured Institutions

Asset Concentration Groups*

FIRST HALF

(The way it is...)

All Insured 

Institutions

Credit 

Card 

Banks

International 

Banks

Agricultural 

Banks

Commercial 

Lenders

Mortgage 

Lenders

Consumer 

Lenders

Other 

Specialized 

<$1 Billion

All Other 

<$1 Billion

All Other 

>$1 Billion

Number of institutions reporting 6,058 13 4 1,466 3,031 493 63 322 603 63

Commercial banks 5,238 12 4 1,449 2,726 119 50 292 531 55

Savings institutions 820 1 0 17 305 374 13 30 72 8

Total assets (in billions) $16,534.0 $501.9 $3,966.6 $270.7 $5,986.7 $396.6 $200.8 $56.1 $103.7 $5,050.8

Commercial banks 15,425.6 437.3 3,966.6 264.9 5,533.6 153.1 97.6 49.9 90.1 4,832.5

Savings institutions 1,108.3 64.6 0.0 5.8 453.1 243.5 103.2 6.2 13.6 218.3

Total deposits (in billions) 12,528.0 286.3 2,807.0 222.7 4,650.0 314.9 168.6 44.9 87.4 3,946.3

Commercial banks 11,660.2 236.8 2,807.0 219.5 4,316.7 126.6 81.6 40.6 76.2 3,755.1

Savings institutions 867.8 49.5 0.0 3.1 333.3 188.2 87.0 4.3 11.2 191.2

Bank net income (in millions) 82,597 5,771 17,439 1,640 29,658 1,866 996 701 478 24,049

Commercial banks 75,505 5,007 17,439 1,600 26,003 986 592 333 436 23,108

Savings institutions 7,093 764 0 41 3,655 880 404 368 42 941

Performance Ratios (annualized, %)

Yield on earning assets 3.45 11.16 2.74 4.13 3.70 3.24 4.08 3.09 3.92 2.86

Cost of funding earning assets 0.36 1.10 0.36 0.47 0.39 0.45 0.45 0.33 0.40 0.23

Net interest margin 3.10 10.06 2.38 3.66 3.31 2.79 3.63 2.76 3.51 2.64

Noninterest income to assets 1.56 2.76 1.78 0.66 1.39 0.94 1.46 6.20 0.87 1.51

Noninterest expense to assets 2.58 5.47 2.33 2.53 2.76 2.25 2.83 5.35 2.94 2.25

Loan and lease loss provision to assets 0.30 2.95 0.22 0.15 0.20 -0.06 0.56 0.04 0.09 0.25

Net operating income to assets 1.00 2.33 0.90 1.19 1.00 0.93 1.00 2.45 0.89 0.94

Pretax return on assets 1.48 3.59 1.30 1.43 1.45 1.44 1.57 3.42 1.15 1.44

Return on assets 1.02 2.33 0.90 1.22 1.01 0.96 1.00 2.51 0.93 0.97

Return on equity 9.05 15.82 8.97 10.70 8.54 8.33 9.94 16.68 7.87 8.70

Net charge-offs to loans and leases 0.45 3.27 0.57 0.13 0.22 0.06 0.65 0.14 0.15 0.40

Loan and lease loss provision to 

net charge-offs 120.06 118.57 109.13 169.89 133.06 -181.50 119.26 93.04 109.72 122.39

Efficiency ratio 58.76 44.79 59.94 61.78 62.24 62.55 56.41 61.16 70.89 56.85

% of unprofitable institutions 4.29 0.00 0.00 2.66 3.99 8.72 3.17 6.21 5.64 1.59

% of institutions with earnings gains 62.35 38.46 75.00 61.32 65.98 54.97 52.38 56.83 56.38 68.25

Condition Ratios (%)

Earning assets to total assets 89.71 92.07 86.34 93.39 90.61 94.79 95.37 91.95 92.76 90.16

Loss allowance to:

Loans and leases 1.33 3.74 1.54 1.41 1.16 0.85 1.14 1.59 1.37 1.19

Noncurrent loans and leases 89.22 328.56 90.66 146.38 102.92 34.17 101.16 114.38 110.81 59.22

Noncurrent assets plus

other real estate owned to assets 0.91 0.87 0.66 0.78 0.93 1.80 0.86 0.59 1.02 1.04

Equity capital ratio 11.28 14.82 9.95 11.58 11.88 11.60 10.23 15.42 11.98 11.18

Core capital (leverage) ratio 9.57 12.49 8.79 10.88 10.01 11.31 10.16 14.20 11.47 9.05

Common equity tier 1 capital ratio 12.74 12.17 13.03 14.53 12.11 22.42 13.75 31.51 19.79 12.52

Tier 1 risk-based capital ratio 12.83 12.30 13.05 14.54 12.25 22.46 13.94 31.53 19.83 12.59

Total risk-based capital ratio 14.29 14.60 14.39 15.66 13.72 23.32 14.74 32.42 20.97 14.11

Net loans and leases to deposits 71.83 128.57 50.55 80.41 88.00 78.21 84.90 34.37 65.49 62.83

Net loans to total assets 54.43 73.33 35.77 66.14 68.35 62.10 71.27 27.52 55.17 49.09

Domestic deposits to total assets 67.75 55.81 46.72 82.25 76.90 79.39 83.93 80.06 84.24 71.79

Structural Changes

New reporters 0 0 0 0 0 0 0 0 0 0

Institutions absorbed by mergers 115 0 0 14 89 4 1 2 4 1

Failed institutions 3 0 0 0 3 0 0 0 0 0

PRIOR FIRST HALVES

(The way it was...)

Number of institutions 2015 6,348 14 4 1,484 3,146 545 55 353 681 66

 2013 6,940 16 4 1,521 3,455 603 47 416 810 68

 2011 7,513 20 4 1,544 3,953 716 72 347 794 63

Total assets (in billions) 2015 $15,753.7 $510.3 $3,747.4 $258.3 $5,194.7 $445.4 $178.4 $60.6 $122.6 $5,236.1

 2013 14,409.8 590.5 3,650.4 236.0 4,723.8 562.0 103.9 64.1 143.9 4,335.2

 2011 13,602.0 656.0 3,328.1 204.2 4,131.7 773.9 97.7 50.0 129.1 4,231.4

Return on assets (%) 2015 1.06 2.95 0.92 1.19 0.93 0.86 1.15 1.11 0.99 1.11

 2013 1.09 3.19 1.00 1.17 0.87 1.01 1.60 1.73 0.94 1.11

 2011 0.85 3.81 0.53 1.09 0.66 0.49 1.60 1.65 0.80 0.84

Net charge-offs to loans & leases (%) 2015 0.43 2.78 0.59 0.07 0.16 0.14 0.59 0.17 0.17 0.40

 2013 0.78 3.37 1.12 0.12 0.49 0.42 1.13 0.44 0.33 0.55

 2011 1.71 6.12 1.69 0.33 1.29 1.01 1.86 0.57 0.45 1.32

Noncurrent assets plus 

OREO to assets (%) 2015 1.04 0.74 0.75 0.80 0.96 1.94 1.03 0.69 1.27 1.28

 2013 1.90 0.92 1.28 1.03 1.94 2.30 0.89 1.00 1.60 2.56

 2011 2.76 1.51 1.76 1.62 3.38 2.72 1.00 1.01 1.88 3.27

Equity capital ratio (%) 2015 11.23 14.83 9.78 11.40 11.96 11.51 10.26 15.10 11.71 11.13

 2013 11.16 15.10 8.86 11.01 11.86 11.23 9.84 14.42 11.32 11.79

 2011 11.29 17.21 8.28 11.26 11.86 10.56 9.93 15.65 11.51 12.29

* See Table V-A (page 10) for explanations.
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 9

TABLE IV-A. First Half 2016, All FDIC-Insured Institutions 

Asset Size Distribution Geographic Regions*

FIRST HALF

(The way it is...)

All Insured 

Institutions

Less Than 

$100 

Million

$100 

Million to 

$1 Billion

$1 Billion 

to $10 

Billion

$10 Billion 

to $250 

Billion

Greater 

Than $250 

Billion

New 

York Atlanta Chicago

Kansas 

City Dallas

San 

Francisco

Number of institutions reporting 6,058 1,637 3,690 619 102 10 739 743 1,305 1,519 1,292 460

Commercial banks 5,238 1,441 3,196 505 86 10 382 672 1,090 1,462 1,211 421

Savings institutions 820 196 494 114 16 0 357 71 215 57 81 39

Total assets (in billions) $16,534.0 $96.7 $1,173.6 $1,724.0 $4,897.6 $8,642.0 $3,127.8 $3,467.9 $3,692.0 $3,604.0 $976.1 $1,666.2

Commercial banks 15,425.6 85.5 993.4 1,417.5 4,287.2 8,642.0 2,699.3 3,383.5 3,581.2 3,547.4 856.4 1,357.8

Savings institutions 1,108.3 11.2 180.2 306.6 610.4 0.0 428.5 84.4 110.8 56.6 119.7 308.4

Total deposits (in billions) 12,528.0 81.0 972.4 1,358.6 3,713.8 6,402.3 2,347.0 2,693.6 2,686.1 2,676.3 797.7 1,327.4

Commercial banks 11,660.2 72.3 829.9 1,127.8 3,227.9 6,402.3 2,027.0 2,625.8 2,606.2 2,632.0 699.2 1,070.0

Savings institutions 867.8 8.6 142.5 230.8 486.0 0.0 320.0 67.8 79.9 44.3 98.5 257.3

Bank net income (in millions) 82,597 447 6,172 8,893 25,961 41,124 13,157 15,719 17,505 19,186 5,171 11,858

Commercial banks 75,505 393 5,294 7,684 21,011 41,124 11,680 15,383 16,869 18,956 4,501 8,115

Savings institutions 7,093 55 878 1,209 4,951 0 1,477 336 637 230 670 3,742

Performance Ratios (annualized, %)

Yield on earning assets 3.45 4.10 4.13 4.01 3.98 2.93 3.49 3.48 2.81 3.61 3.96 4.06

Cost of funding earning assets 0.36 0.43 0.46 0.42 0.44 0.29 0.44 0.30 0.30 0.40 0.32 0.39

Net interest margin 3.10 3.67 3.67 3.59 3.54 2.64 3.05 3.18 2.51 3.22 3.64 3.67

Noninterest income to assets 1.56 1.14 1.16 1.18 1.55 1.69 1.35 1.44 1.88 1.35 1.39 1.99

Noninterest expense to assets 2.58 3.38 3.15 2.81 2.68 2.39 2.56 2.59 2.55 2.41 3.08 2.74

Loan and lease loss provision to assets 0.30 0.11 0.12 0.19 0.48 0.25 0.30 0.38 0.17 0.30 0.27 0.44

Net operating income to assets 1.00 0.89 1.03 1.04 1.07 0.95 0.85 0.89 0.97 1.06 1.05 1.45

Pretax return on assets 1.48 1.07 1.35 1.51 1.64 1.41 1.23 1.35 1.40 1.57 1.40 2.25

Return on assets 1.02 0.93 1.07 1.06 1.08 0.97 0.85 0.92 0.97 1.09 1.08 1.45

Return on equity 9.05 7.26 9.39 9.02 8.89 9.13 7.15 7.47 9.37 10.70 9.67 11.99

Net charge-offs to loans and leases 0.45 0.16 0.11 0.20 0.62 0.47 0.47 0.53 0.27 0.53 0.30 0.53

Loan and lease loss provision to 

net charge-offs 120.06 116.09 161.84 139.99 124.74 111.16 117.27 120.65 131.39 105.21 138.25 134.33

Efficiency ratio 58.76 74.62 68.64 62.03 55.43 58.55 61.86 59.82 61.52 55.75 64.61 50.10

% of unprofitable institutions 4.29 9.47 2.66 0.97 0.98 0.00 5.14 6.46 5.52 2.83 2.71 5.22

% of institutions with earnings gains 62.35 56.26 63.88 68.82 66.67 50.00 60.76 63.53 61.99 59.84 64.55 66.09

Condition Ratios (%)

Earning assets to total assets 89.71 92.26 92.90 92.19 91.18 87.93 89.26 89.30 88.60 89.35 91.60 93.57

Loss allowance to:

Loans and leases 1.33 1.44 1.32 1.17 1.38 1.35 1.26 1.37 1.34 1.37 1.27 1.34

Noncurrent loans and leases 89.22 111.14 126.54 115.67 111.48 70.10 104.56 82.11 85.11 71.10 97.99 166.28

Noncurrent assets plus

other real estate owned to assets 0.91 1.17 1.05 0.88 0.83 0.94 0.73 1.08 0.85 1.10 1.04 0.55

Equity capital ratio 11.28 12.98 11.47 11.79 12.21 10.60 12.01 12.37 10.31 10.15 11.21 12.22

Core capital (leverage) ratio 9.57 12.48 10.96 10.44 10.36 8.72 9.82 9.62 9.14 8.92 9.96 11.11

Common equity tier 1 capital ratio 12.74 20.01 15.36 13.41 12.78 12.14 12.85 12.69 12.64 11.77 13.03 14.87

Tier 1 risk-based capital ratio 12.83 20.05 15.41 13.44 12.96 12.19 13.00 12.80 12.69 11.77 13.14 15.05

Total risk-based capital ratio 14.29 21.13 16.53 14.47 14.59 13.68 14.51 14.31 13.89 13.61 14.30 16.19

Net loans and leases to deposits 71.83 69.68 79.97 87.60 80.67 62.16 72.00 74.41 66.94 70.07 78.19 75.94

Net loans to total assets 54.43 58.33 66.25 69.03 61.17 46.05 54.03 57.80 48.70 52.04 63.90 60.50

Domestic deposits to total assets 67.75 83.70 82.84 78.54 73.95 59.85 67.57 74.54 63.50 56.81 81.59 78.89

Structural Changes

New reporters 0 0 0 0 0 0 0 0 0 0 0 0

Institutions absorbed by mergers 115 36 69 10 0 0 18 17 31 22 17 10

Failed institutions 3 2 1 0 0 0 1 0 1 0 1 0

PRIOR FIRST HALVES

(The way it was...)

Number of institutions 2015 6,348 1,799 3,847 591 102 9 787 788 1,371 1,571 1,338 493

 2013 6,940 2,141 4,146 546 100 7 858 884 1,483 1,686 1,468 561

 2011 7,513 2,550 4,296 561 100 6 932 990 1,575 1,804 1,570 642

Total assets (in billions) 2015 $15,753.7 $105.7 $1,203.1 $1,616.8 $4,737.8 $8,090.2 $3,063.0 $3,292.1 $3,537.0 $3,405.9 $930.3 $1,525.4

 2013 14,409.8 124.8 1,256.7 1,413.8 4,702.8 6,911.6 2,855.1 2,980.2 3,344.1 3,087.9 867.2 1,275.3

 2011 13,602.0 146.0 1,272.9 1,422.1 4,627.3 6,133.8 2,769.3 2,916.0 3,119.0 1,672.3 788.5 2,337.0

Return on assets (%) 2015 1.06 0.92 1.00 1.18 1.04 1.06 0.90 1.04 0.95 1.20 1.10 1.32

 2013 1.09 0.76 0.92 1.19 0.99 1.18 0.70 1.07 1.11 1.26 1.14 1.55

 2011 0.85 0.53 0.53 0.82 1.17 0.70 1.12 0.53 0.69 1.21 0.90 0.90

Net charge-offs to loans & leases (%) 2015 0.43 0.14 0.12 0.20 0.54 0.48 0.47 0.50 0.26 0.52 0.19 0.48

 2013 0.78 0.31 0.34 0.42 1.01 0.80 1.05 0.76 0.52 1.00 0.35 0.61

 2011 1.71 0.54 0.84 1.29 2.38 1.50 2.05 1.75 1.36 1.93 0.89 1.74

Noncurrent assets plus 

OREO to assets (%) 2015 1.04 1.35 1.27 1.04 0.80 1.14 0.76 1.28 1.00 1.28 1.09 0.57

 2013 1.90 1.90 2.11 2.15 1.17 2.31 1.26 2.77 1.74 2.18 1.86 1.12

 2011 2.76 2.40 3.34 3.36 2.01 3.06 1.87 3.82 2.56 3.82 2.92 1.92

Equity capital ratio (%) 2015 11.23 12.53 11.28 11.84 12.40 10.39 11.74 12.36 10.13 10.32 11.14 12.37

 2013 11.16 11.76 10.85 11.78 12.43 10.22 12.00 12.22 9.17 10.83 10.74 13.14

 2011 11.29 11.84 10.58 11.86 12.93 10.05 12.80 12.05 8.49 11.79 11.02 12.02

* See Table V-A (page 11) for explanations.
2 0 1 6  •Volume 1 0  • Number 3

10 FDIC QUARTERLY

TABLE V-A. Loan Performance, All FDIC-Insured Institutions

Asset Concentration Groups*

June 30, 2016 All Insured 

Institutions

Credit 

Card 

Banks

International 

Banks

Agricultural 

Banks

Commercial 

Lenders

Mortgage 

Lenders

Consumer 

Lenders

Other 

Specialized 

<$1 Billion

All Other 

<$1 Billion

All Other 

>$1 Billion

Percent of Loans 30-89 Days Past Due

All loans secured by real estate 0.72 0.31 1.05 0.66 0.45 0.79 0.49 1.28 1.13 1.15

Construction and development 0.34 0.00 0.53 0.60 0.30 0.72 0.43 0.87 0.73 0.40

Nonfarm nonresidential 0.23 2.93 0.62 0.63 0.21 0.38 0.81 0.91 0.85 0.14

Multifamily residential real estate 0.11 0.00 0.01 0.18 0.11 0.16 0.08 0.24 0.31 0.19

Home equity loans 0.61 0.82 1.03 0.39 0.44 0.62 0.37 0.61 0.60 0.71

Other 1-4 family residential 1.25 0.22 1.47 1.02 0.87 0.87 0.50 1.64 1.44 1.84

Commercial and industrial loans 0.25 0.86 0.22 0.91 0.28 0.45 0.13 0.80 1.02 0.18

Loans to individuals 1.21 1.31 1.13 1.33 1.02 0.55 0.76 1.82 1.60 1.43

Credit card loans 1.14 1.31 1.03 0.86 0.95 1.23 0.71 2.71 1.09 1.00

Other loans to individuals 1.28 1.24 1.32 1.37 1.04 0.52 0.77 1.70 1.61 1.68

All other loans and leases (including farm) 0.20 0.19 0.27 0.59 0.17 0.17 0.13 0.65 0.57 0.15

Total loans and leases 0.64 1.29 0.70 0.70 0.43 0.74 0.64 1.25 1.12 0.80

Percent of Loans Noncurrent**

All real estate loans 2.13 0.53 3.13 0.97 1.24 2.77 2.78 1.59 1.36 3.68

Construction and development 0.89 0.00 0.34 0.87 0.90 1.04 5.36 2.79 1.46 0.83

Nonfarm nonresidential 0.78 0.00 0.62 1.11 0.75 1.40 6.24 1.62 1.49 0.75

Multifamily residential real estate 0.23 0.00 0.14 0.47 0.25 0.36 0.68 0.74 0.90 0.20

Home equity loans 2.44 0.25 3.71 0.54 1.32 2.19 2.10 1.56 0.53 3.63

Other 1-4 family residential 3.57 0.56 4.53 0.96 2.18 3.09 2.57 1.47 1.40 5.46

Commercial and industrial loans 1.33 0.77 1.48 1.35 1.26 0.98 0.17 1.18 1.29 1.41

Loans to individuals 0.78 1.15 0.92 0.55 0.68 0.27 0.55 0.79 0.71 0.52

Credit card loans 1.07 1.18 0.98 0.21 0.96 0.39 1.12 0.95 0.54 0.93

Other loans to individuals 0.50 0.57 0.81 0.57 0.62 0.26 0.40 0.76 0.72 0.30

All other loans and leases (including farm) 0.25 0.03 0.23 0.80 0.29 0.12 2.67 0.45 0.45 0.14

Total loans and leases 1.49 1.14 1.70 0.96 1.12 2.50 1.13 1.39 1.24 2.01

Percent of Loans Charged-Off (net, YTD)

All real estate loans 0.06 -0.06 0.07 0.04 0.04 0.04 0.16 0.07 0.08 0.10

Construction and development -0.04 0.00 0.20 -0.04 -0.04 -0.30 2.45 0.24 0.03 -0.09

Nonfarm nonresidential 0.01 0.00 0.01 0.04 0.02 0.06 0.02 0.08 0.09 -0.04

Multifamily residential real estate 0.00 0.00 0.00 0.13 0.00 0.03 0.00 0.01 0.02 -0.02

Home equity loans 0.30 -2.66 0.35 0.02 0.18 0.03 0.43 0.10 0.06 0.48

Other 1-4 family residential 0.07 -0.01 0.04 0.06 0.07 0.05 0.06 0.04 0.10 0.08

Commercial and industrial loans 0.42 2.38 0.46 0.27 0.40 0.15 0.02 0.15 0.21 0.43

Loans to individuals 1.90 3.31 2.35 0.42 0.95 0.32 0.91 0.42 0.48 1.48

Credit card loans 3.11 3.39 3.18 1.26 2.52 1.30 2.54 1.05 1.61 2.73

Other loans to individuals 0.70 1.58 0.94 0.35 0.60 0.27 0.47 0.33 0.47 0.76

All other loans and leases (including farm) 0.11 0.17 0.09 0.25 0.17 0.12 0.02 0.43 0.49 0.08

Total loans and leases 0.45 3.27 0.57 0.13 0.22 0.06 0.65 0.14 0.15 0.40

Loans Outstanding (in billions)

All real estate loans $4,505.9 $0.2 $534.3 $110.0 $2,479.7 $220.9 $32.7 $11.2 $44.5 $1,072.5

Construction and development 294.1 0.0 10.5 6.4 223.2 5.5 0.4 0.8 2.7 44.7

Nonfarm nonresidential 1,278.4 0.0 41.3 29.1 933.4 18.8 2.5 3.6 10.5 239.3

Multifamily residential real estate 365.2 0.0 66.2 3.5 246.5 6.7 0.4 0.3 1.2 40.3

Home equity loans 452.3 0.0 62.0 2.1 219.1 10.6 5.9 0.4 1.8 150.4

Other 1-4 family residential 1,961.0 0.2 305.9 27.7 816.1 178.7 23.4 5.4 24.5 579.1

Commercial and industrial loans 1,931.5 14.4 309.6 21.3 987.4 7.0 7.5 1.8 5.0 577.4

Loans to individuals 1,515.2 367.5 259.6 6.6 346.1 6.0 98.0 1.8 4.4 425.2

Credit card loans 745.9 350.3 164.7 0.5 57.2 0.2 20.4 0.2 0.1 152.4

Other loans to individuals 769.2 17.2 94.9 6.1 288.9 5.7 77.7 1.6 4.4 272.8

All other loans and leases (including farm) 1,170.5 0.3 338.3 43.8 327.7 14.5 6.6 0.9 4.2 434.2

Total loans and leases (plus unearned income) 9,123.1 382.4 1,441.9 181.7 4,140.8 248.4 144.9 15.7 58.0 2,509.3

Memo: Other Real Estate Owned (in millions)

All other real estate owned 13,152.6 0.2 751.0 361.6 8,588.1 864.1 85.5 107.1 336.6 2,058.5

Construction and development 4,029.1 0.0 0.0 130.4 3,285.4 96.4 7.8 47.6 124.0 337.5

Nonfarm nonresidential 3,240.8 0.0 53.0 116.8 2,563.5 43.6 16.8 32.7 94.2 320.2

Multifamily residential real estate 204.6 0.0 1.0 14.6 171.5 4.0 0.6 1.9 7.9 3.1

1-4 family residential 4,123.9 0.2 334.0 74.0 2,287.3 211.0 51.3 23.7 102.0 1,040.4

Farmland 190.5 0.0 0.0 25.6 146.5 1.5 0.0 1.0 8.6 7.3

GNMA properties 1,353.7 0.0 355.0 0.2 133.8 507.6 8.9 0.2 0.0 348.0

* Asset Concentration Group Definitions (Groups are hierarchical and mutually exclusive):

Credit-card Lenders - Institutions whose credit-card loans plus securitized receivables exceed 50 percent of total assets plus securitized receivables.

International Banks - Banks with assets greater than $10 billion and more than 25 percent of total assets in foreign offices.

Agricultural Banks - Banks whose agricultural production loans plus real estate loans secured by farmland exceed 25 percent of the total loans and leases.

Commercial Lenders - Institutions whose commercial and industrial loans, plus real estate construction and development loans, plus loans secured by commercial real estate properties 

exceed 25 percent of total assets.

Mortgage Lenders - Institutions whose residential mortgage loans, plus mortgage-backed securities, exceed 50 percent of total assets.

Consumer Lenders - Institutions whose residential mortgage loans, plus credit-card loans, plus other loans to individuals, exceed 50 percent of total assets.

Other Specialized < $1 Billion - Institutions with assets less than $1 billion, whose loans and leases are less than 40 percent of total assets.

All Other < $1 billion - Institutions with assets less than $1 billion that do not meet any of the definitions above, they have significant lending activity with no identified asset 

concentrations.

All Other > $1 billion - Institutions with assets greater than $1 billion that do not meet any of the definitions above, they have significant lending activity with no identified asset 

concentrations.

** Noncurrent loan rates represent the percentage of loans in each category that are past due 90 days or more or that are in nonaccrual status.
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 11

TABLE V-A. Loan Performance, All FDIC-Insured Institutions

Asset Size Distribution Geographic Regions*

June 30, 2016 All Insured 

Institutions

Less Than 

$100 

Million

$100 

Million to 

$1 Billion

$1 Billion 

to 

$10 Billion

$10 Billion 

to $250 

Billion

Greater 

Than $250 

Billion

New 

York Atlanta Chicago

Kansas 

City Dallas

San 

Francisco

Percent of Loans 30-89 Days Past Due 

All loans secured by real estate 0.72 1.06 0.59 0.33 0.55 1.10 0.47 0.85 0.76 1.05 0.68 0.30

Construction and development 0.34 0.64 0.51 0.30 0.26 0.36 0.36 0.30 0.30 0.44 0.39 0.25

Nonfarm nonresidential 0.23 0.68 0.40 0.21 0.18 0.19 0.24 0.19 0.28 0.25 0.30 0.14

Multifamily residential real estate 0.11 0.40 0.22 0.09 0.10 0.08 0.10 0.10 0.08 0.28 0.13 0.06

Home equity loans 0.61 0.61 0.46 0.37 0.48 0.77 0.42 0.73 0.71 0.68 0.43 0.27

Other 1-4 family residential 1.25 1.58 0.88 0.55 1.01 1.72 0.82 1.48 1.20 1.73 1.40 0.54

Commercial and industrial loans 0.25 1.19 0.65 0.37 0.24 0.19 0.25 0.18 0.29 0.22 0.48 0.27

Loans to individuals 1.21 1.75 1.47 1.10 1.10 1.31 0.99 1.64 1.02 1.16 0.99 1.12

Credit card loans 1.14 4.08 1.86 1.53 1.23 1.00 0.94 1.28 0.93 1.08 0.72 1.58

Other loans to individuals 1.28 1.71 1.44 0.95 0.93 1.59 1.09 2.00 1.05 1.26 1.12 0.75

All other loans and leases (including farm) 0.20 0.58 0.47 0.30 0.17 0.19 0.08 0.10 0.38 0.21 0.20 0.22

Total loans and leases 0.64 1.05 0.62 0.39 0.56 0.76 0.49 0.75 0.63 0.75 0.63 0.47

Percent of Loans Noncurrent** 

All real estate loans 2.13 1.34 1.05 0.98 1.55 3.61 1.55 2.64 2.40 3.12 1.32 0.66

Construction and development 0.89 1.40 1.44 0.99 0.60 0.67 0.95 1.46 0.72 0.56 0.74 0.69

Nonfarm nonresidential 0.78 1.49 1.00 0.75 0.76 0.64 0.98 0.71 0.89 0.74 0.70 0.55

Multifamily residential real estate 0.23 0.41 0.62 0.23 0.17 0.19 0.20 0.21 0.26 0.31 0.39 0.17

Home equity loans 2.44 0.52 0.64 0.72 1.44 3.62 2.36 3.08 2.49 2.41 1.38 0.65

Other 1-4 family residential 3.57 1.42 1.16 1.50 2.64 5.43 2.41 4.21 3.74 5.27 2.52 0.83

Commercial and industrial loans 1.33 1.83 1.25 1.37 1.43 1.26 1.02 1.32 1.12 1.61 1.85 1.36

Loans to individuals 0.78 0.78 0.87 0.60 0.88 0.70 0.84 0.83 0.66 0.75 0.80 0.77

Credit card loans 1.07 1.73 1.27 1.33 1.16 0.94 0.96 1.09 0.90 1.01 1.12 1.42

Other loans to individuals 0.50 0.77 0.85 0.36 0.51 0.49 0.64 0.55 0.58 0.41 0.65 0.24

All other loans and leases (including farm) 0.25 0.86 0.68 0.96 0.22 0.17 0.42 0.12 0.18 0.29 0.33 0.32

Total loans and leases 1.49 1.29 1.05 1.01 1.24 1.92 1.20 1.67 1.57 1.93 1.30 0.81

Percent of Loans Charged-Off (net, YTD) 

All real estate loans 0.06 0.06 0.05 0.03 0.05 0.09 0.06 0.11 0.07 0.06 0.02 0.00

Construction and development -0.04 -0.07 0.00 -0.03 -0.10 0.01 0.01 0.01 -0.03 -0.06 -0.04 -0.20

Nonfarm nonresidential 0.01 0.03 0.05 0.03 0.01 -0.05 0.01 0.02 0.03 -0.04 0.02 0.00

Multifamily residential real estate 0.00 0.05 0.03 -0.01 0.00 -0.01 0.00 0.00 -0.01 0.00 0.00 0.01

Home equity loans 0.30 -0.04 0.05 0.11 0.23 0.41 0.22 0.45 0.24 0.40 0.18 0.01

Other 1-4 family residential 0.07 0.10 0.07 0.05 0.08 0.07 0.10 0.10 0.06 0.06 0.03 0.02

Commercial and industrial loans 0.42 0.46 0.25 0.37 0.46 0.43 0.27 0.39 0.36 0.52 0.67 0.52

Loans to individuals 1.90 0.68 0.68 1.48 2.09 1.82 2.05 2.03 1.13 2.31 1.35 1.80

Credit card loans 3.11 10.79 4.50 3.72 3.18 2.98 2.80 3.28 2.95 3.28 2.42 3.35

Other loans to individuals 0.70 0.52 0.42 0.73 0.59 0.81 0.76 0.70 0.50 1.08 0.83 0.45

All other loans and leases (including farm) 0.11 0.16 0.18 0.31 0.12 0.09 0.09 0.07 0.10 0.13 0.30 0.14

Total loans and leases 0.45 0.16 0.11 0.20 0.62 0.47 0.47 0.53 0.27 0.53 0.30 0.53

Loans Outstanding (in billions) 

All real estate loans $4,505.9 $38.8 $607.5 $868.6 $1,338.3 $1,652.7 $914.2 $918.8 $921.4 $862.9 $395.3 $493.2

Construction and development 294.1 2.3 55.3 80.4 89.7 66.4 53.8 58.6 48.2 45.3 58.2 30.1

Nonfarm nonresidential 1,278.4 9.8 229.8 353.5 401.7 283.5 289.4 267.1 196.0 184.0 158.8 183.2

Multifamily residential real estate 365.2 1.1 32.5 85.9 135.6 110.1 133.3 44.1 94.4 30.4 16.2 46.7

Home equity loans 452.3 1.0 25.8 48.0 144.7 232.8 86.8 118.9 112.1 85.9 19.7 29.0

Other 1-4 family residential 1,961.0 17.5 217.1 281.0 551.5 893.9 347.3 417.3 447.7 429.2 126.5 192.9

Commercial and industrial loans 1,931.5 6.7 98.9 192.3 708.0 925.5 295.5 475.7 410.3 401.9 126.7 221.4

Loans to individuals 1,515.2 3.7 31.8 82.1 682.8 714.8 319.5 382.2 219.9 308.4 60.6 224.6

Credit card loans 745.9 0.1 2.0 20.5 391.2 332.2 200.1 193.9 57.0 174.5 19.3 101.1

Other loans to individuals 769.2 3.6 29.8 61.6 291.5 382.6 119.4 188.3 162.9 133.9 41.3 123.5

All other loans and leases (including farm) 1,170.5 8.0 50.1 61.8 309.1 741.5 182.6 255.7 270.9 328.9 49.4 82.9

Total loans and leases 

(plus unearned income) 9,123.1 57.3 788.4 1,204.7 3,038.3 4,034.5 1,711.9 2,032.4 1,822.5 1,902.1 632.0 1,022.1

Memo: Other Real Estate Owned 

(in millions) 

All other real estate owned 13,152.6 387.1 4,003.0 2,875.5 3,001.8 2,885.3 2,039.2 3,491.5 2,611.7 2,197.5 1,875.5 937.2

Construction and development 4,029.1 130.0 1,858.7 1,177.5 494.0 369.0 365.8 1,184.3 569.2 793.4 815.0 301.3

Nonfarm nonresidential 3,240.8 128.2 1,241.6 904.2 623.3 343.4 519.6 648.7 649.5 470.7 606.9 345.3

Multifamily residential real estate 204.6 16.1 93.0 61.6 17.2 16.7 55.0 34.5 31.2 37.9 27.9 18.2

1-4 family residential 4,123.9 105.6 721.1 662.3 1,196.2 1,438.7 1,029.8 1,023.4 911.0 547.2 364.9 247.6

Farmland 190.5 7.0 87.1 55.2 39.3 1.9 11.4 42.9 51.6 19.0 52.4 13.3

GNMA properties 1,353.7 0.2 1.5 14.6 631.9 705.5 57.6 557.8 397.2 321.2 8.5 11.5

* Regions:

New York - Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Puerto Rico, Rhode Island, Vermont, 

U.S. Virgin Islands

Atlanta - Alabama, Florida, Georgia, North Carolina, South Carolina, Virginia, West Virginia

Chicago - Illinois, Indiana, Kentucky, Michigan, Ohio, Wisconsin

Kansas City - Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota

Dallas - Arkansas, Colorado, Louisiana, Mississippi, New Mexico, Oklahoma, Tennessee, Texas

San Francisco - Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, Pacific Islands, Utah, Washington, Wyoming

** Noncurrent loan rates represent the percentage of loans in each category that are past due 90 days or more or that are in nonaccrual status.
2 0 1 6  •Volume 1 0  • Number 3

12 FDIC QUARTERLY

Table VI-A. Derivatives, All FDIC-Insured Call Report Filers

2nd 

Quarter 

2016

1st 

Quarter 

2016

4th

Quarter 

2015

3rd

Quarter 

2015

2nd 

Quarter 

2015

% 

Change 

15Q2-

16Q2

Asset Size Distribution

(dollar figures in millions;

notional amounts unless otherwise indicated)

Less 

Than 

$100 

Million

$100 

Million 

to $1 

Billion

$1 

Billion 

to $10 

Billion

$10 

Billion 

to $250 

Billion

Greater 

Than 

$250 

Billion

ALL DERIVATIVE HOLDERS 

Number of institutions reporting derivatives 1,446 1,429 1,414 1,418 1,431 1.0 68 854 417 97 10

Total assets of institutions reporting derivatives $15,032,950 $14,766,932 $14,422,547 $14,231,256 $14,198,373 5.9 $5,090 $355,789 $1,295,588 $4,734,451 $8,642,031

Total deposits of institutions reporting derivatives 11,313,481 11,189,578 10,938,377 10,735,417 10,706,603 5.7 4,233 292,281 1,025,073 3,589,616 6,402,278

Total derivatives 192,349,432 195,508,514 181,985,996 195,398,665 201,613,096 -4.6 296 26,357 124,026 49,385,463 142,813,289

Derivative Contracts by Underlying Risk Exposure 

Interest rate 143,794,055 147,218,271 138,363,456 148,665,387 154,349,781 -6.8 296 26,327 117,366 42,890,592 100,759,474

Foreign exchange* 37,701,396 37,128,715 33,133,167 34,636,874 34,969,999 7.8 0 12 5,689 5,906,571 31,789,125

Equity 2,672,364 2,533,921 2,395,120 2,508,972 2,372,914 12.6 0 4 313 182,531 2,489,515

Commodity & other (excluding credit derivatives) 1,328,302 1,209,774 1,107,759 1,389,755 1,432,675 -7.3 0 6 65 62,737 1,265,494

Credit 6,853,314 7,417,833 6,986,493 8,197,677 8,487,726 -19.3 0 8 593 343,031 6,509,682

Total 192,349,432 195,508,514 181,985,996 195,398,665 201,613,096 -4.6 296 26,357 124,026 49,385,463 142,813,289

Derivative Contracts by Transaction Type 

Swaps 111,900,657 114,814,419 107,392,487 112,697,189 117,508,160 -4.8 49 7,634 70,897 31,086,643 80,735,435

Futures & forwards 38,789,790 37,150,744 35,684,919 38,988,137 40,359,831 -3.9 84 9,285 26,212 8,002,504 30,751,706

Purchased options 16,277,222 16,857,475 15,469,371 16,817,158 16,221,724 0.3 11 798 6,070 4,936,669 11,333,674

Written options 16,011,610 16,706,898 15,419,192 16,235,799 15,945,490 0.4 153 8,620 20,170 4,891,366 11,091,302

Total 182,979,279 185,529,536 173,965,968 184,738,283 190,035,206 -3.7 296 26,337 123,349 48,917,181 133,912,116

Fair Value of Derivative Contracts 

Interest rate contracts 75,052 75,481 67,223 76,692 71,659 4.7 0 16 -433 32,899 42,570

Foreign exchange contracts 11,369 -11,530 -12,485 -15,284 -19,614 N/M 0 0 9 1,997 9,363

Equity contracts 6,637 5,035 5,318 7,880 2,695 146.3 0 0 2 412 6,224

Commodity & other (excluding credit derivatives) -3,151 -4,310 -3,571 -6,952 -3,488 -9.7 0 0 1 -130 -3,021

Credit derivatives as guarantor 1,037 2,901 -2,697 1,890 35,840 -97.1 0 0 -2 -892 1,933

Credit derivatives as beneficiary -167 -966 7,076 2,441 -34,672 -99.5 0 0 -27 1,483 -1,622

Derivative Contracts by Maturity** 

Interest rate contracts < 1 year 66,423,416 65,650,617 55,047,362 60,754,367 63,733,487 4.2 88 8,612 24,409 14,858,718 51,531,589

 1-5 years 47,001,897 50,714,670 49,406,784 52,458,012 54,771,222 -14.2 26 2,402 28,361 13,531,558 33,439,550

 > 5 years 33,930,441 34,846,003 32,980,646 34,618,605 35,837,393 -5.3 34 5,304 38,722 11,248,404 22,637,976

Foreign exchange and gold contracts < 1 year 26,621,562 26,231,437 24,129,441 25,206,272 25,081,829 6.1 0 0 3,452 3,371,417 23,246,693

 1-5 years 4,112,254 4,081,595 3,986,436 3,672,989 3,859,497 6.5 0 0 390 421,278 3,690,586

 > 5 years 2,151,420 1,819,360 1,647,804 1,500,445 1,612,940 33.4 0 0 72 202,583 1,948,765

Equity contracts < 1 year 1,907,096 1,841,069 1,743,252 1,610,476 1,571,382 21.4 0 0 27 68,060 1,839,009

 1-5 years 709,947 674,710 627,875 671,362 580,777 22.2 0 0 107 45,812 664,028

 > 5 years 134,063 129,076 130,188 183,539 162,800 -17.7 0 0 6 15,582 118,474

 Commodity & other contracts (including credit 

derivatives, excluding gold contracts) < 1 year 3,032,137 2,813,615 2,651,133 2,566,099 2,357,062 28.6 0 7 29 95,348 2,936,753

 1-5 years 4,354,280 4,800,922 4,694,153 5,771,045 5,329,031 -18.3 0 5 81 151,678 4,202,516

 > 5 years 368,331 619,196 405,131 750,909 428,131 -14.0 0 0 132 26,817 341,382

Risk-Based Capital: Credit Equivalent Amount 

Total current exposure to tier 1 capital (%) 37.2 34.5 30.1 34.3 31.6 0.2 0.6 1.3 22.9 54.6

Total potential future exposure to tier 1 capital (%) 43.5 47.5 48.3 50.3 54.8 0.1 0.3 0.6 17.4 70.0

Total exposure (credit equivalent amount) 

to tier 1 capital (%) 80.7 82.0 78.4 84.6 86.4 0.3 0.9 1.9 40.3 124.6

Credit losses on derivatives*** 31.9 13.3 78.2 71.8 61.4 -48.0 0.0 0.9 0.2 11.2 19.5

HELD FOR TRADING 

Number of institutions reporting derivatives 257 251 250 247 249 3.2 9 94 90 55 9

Total assets of institutions reporting derivatives 11,985,471 11,719,700 11,460,984 11,384,424 11,367,408 5.4 580 41,182 323,782 3,233,621 8,386,305

Total deposits of institutions reporting derivatives 8,976,731 8,830,937 8,660,644 8,553,870 8,547,594 5.0 485 34,092 253,121 2,501,635 6,187,398

Derivative Contracts by Underlying Risk Exposure 

Interest rate 141,316,494 144,656,611 136,029,963 146,136,877 151,583,777 -6.8 74 1,920 27,944 42,391,240 98,895,316

Foreign exchange 34,670,639 34,029,005 31,665,956 31,764,784 31,318,657 10.7 0 0 4,409 5,761,655 28,904,575

Equity 2,656,373 2,510,439 2,370,468 2,486,427 2,353,529 12.9 0 0 0 169,459 2,486,914

Commodity & other 1,326,621 1,208,052 1,105,989 1,387,414 1,430,301 -7.2 0 0 34 61,772 1,264,814

Total 179,970,127 182,404,107 171,172,377 181,775,502 186,686,264 -3.6 74 1,920 32,387 48,384,126 131,551,619

Trading Revenues: Cash & Derivative Instruments 

Interest rate 1,906 3,072 155 2,581 3,404 -44.0 0 0 14 -687 2,579

Foreign exchange 3,736 1,407 3,401 1,931 854 337.5 0 0 -1 1,556 2,180

Equity 972 670 741 50 584 66.4 0 0 2 18 952

Commodity & other (including credit derivatives) 271 604 -25 758 660 -58.9 0 0 1 -312 582

Total trading revenues 6,885 5,753 4,271 5,319 5,502 25.1 0 0 17 575 6,293

Share of Revenue 

Trading revenues to gross revenues (%) 5.4 4.7 3.5 4.4 4.5 0.0 0.0 0.5 1.8 6.9

Trading revenues to net operating revenues (%) 24.1 23.2 15.7 19.9 19.0 0.0 0.2 2.3 8.4 30.1

HELD FOR PURPOSES OTHER THAN TRADING 

Number of institutions reporting derivatives 1,324 1,303 1,299 1,305 1,311 1.0 60 776 386 92 10

Total assets of institutions reporting derivatives 14,753,967 14,524,116 14,205,106 13,960,564 13,896,046 6.2 4,596 324,192 1,213,947 4,569,202 8,642,031

Total deposits of institutions reporting derivatives 11,086,461 10,994,713 10,764,769 10,518,599 10,465,122 5.9 3,821 265,954 960,448 3,453,959 6,402,278

Derivative Contracts by Underlying Risk Exposure 

Interest rate 2,477,561 2,561,660 2,333,492 2,528,510 2,766,004 -10.4 223 24,407 89,423 499,352 1,864,157

Foreign exchange 513,919 538,565 433,677 409,385 561,179 -8.4 0 0 1,196 19,665 493,058

Equity 15,991 23,483 24,652 22,545 19,385 -17.5 0 4 313 13,072 2,601

Commodity & other 1,681 1,722 1,770 2,342 2,374 -29.2 0 5 30 965 681

Total notional amount 3,009,152 3,125,429 2,793,591 2,962,781 3,348,942 -10.1 223 24,416 90,962 533,055 2,360,497

All line items are reported on a quarterly basis. N/M - Not Meaningful

* Include spot foreign exchange contracts. All other references to foreign exchange contracts in which notional values or fair values are reported exclude spot foreign exchange contracts.

** Derivative contracts subject to the risk-based capital requirements for derivatives.

*** The reporting of credit losses on derivatives is applicable to all banks filing the FFIEC 031 report form and to those banks filing the FFIEC 041 report form that have $300 million or 

more in total assets.
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 13

TABLE VII-A. Servicing, Securitization, and Asset Sales Activities (All FDIC-Insured Call Report Filers)

Asset Size Distribution

(dollar figures in millions)

2nd 

Quarter 

2016

1st 

Quarter

2016

4th 

Quarter

2015

3rd 

Quarter

2015

2nd 

Quarter

2015

% 

Change 

15Q2-

16Q2

Less 

Than 

$100 

Million

$100 

Million 

to $1 

Billion

$1 

Billion 

to $10 

Billion

$10 

Billion 

to $250 

Billion

Greater 

Than 

$250 

Billion

Assets Securitized and Sold with Servicing Retained or with 

Recourse or Other Seller-Provided Credit Enhancements 

Number of institutions reporting securitization activities 75 74 73 72 71 5.6 0 19 16 33 7

Outstanding Principal Balance by Asset Type 

1-4 family residential loans $687,085 $704,676 $715,914 $734,519 $749,911 -8.4 $0 $2,052 $12,451 $84,762 $587,821

Home equity loans 29 29 30 31 33 -12.1 0 0 1 27 0

Credit card receivables 13,485 13,400 13,502 14,187 17,766 -24.1 0 0 0 13,380 105

Auto loans 8,935 5,604 6,095 6,221 5,660 57.9 0 0 2,526 6,409 0

Other consumer loans 4,908 5,093 5,286 4,754 6,430 -23.7 0 1 0 2,527 2,380

Commercial and industrial loans 169 204 15 14 14 1,107.1 0 7 0 0 162

All other loans, leases, and other assets 71,246 74,712 79,844 86,277 89,384 -20.3 0 94 8,381 562 62,209

Total securitized and sold 785,857 803,719 820,686 846,005 869,198 -9.6 0 2,154 23,360 107,668 652,676

Maximum Credit Exposure by Asset Type 

1-4 family residential loans 2,514 2,617 2,840 2,933 3,101 -18.9 0 4 0 1,433 1,077

Home equity loans 0 0 0 0 0 0.0 0 0 0 0 0

Credit card receivables 1,207 1,152 1,108 1,187 1,470 -17.9 0 0 0 1,207 0

Auto loans 0 0 0 0 0 0.0 0 0 0 0 0

Other consumer loans 91 86 89 89 187 -51.3 0 0 0 0 91

Commercial and industrial loans 0 0 0 0 0 0.0 0 0 0 0 0

All other loans, leases, and other assets 971 902 990 1,319 1,084 -10.4 0 0 0 5 966

Total credit exposure 4,783 4,757 5,026 5,528 5,842 -18.1 0 4 0 2,645 2,134

Total unused liquidity commitments provided to institution’s own 

securitizations

138 73 36 37 38 263.2 0 0 0 0 138

Securitized Loans, Leases, and Other Assets 30-89 Days Past Due (%) 

1-4 family residential loans 3.6 3.1 3.9 3.8 3.4 0.0 1.7 1.4 3.0 3.8

Home equity loans 8.6 6.2 5.4 5.9 5.3 0.0 0.0 100.0 4.4 0.0

Credit card receivables 0.3 0.4 0.4 0.4 0.4 0.0 0.0 0.0 0.3 1.0

Auto loans 1.3 1.2 1.5 1.1 0.9 0.0 0.0 2.0 1.0 0.0

Other consumer loans 3.8 3.8 3.9 4.3 4.1 0.0 0.0 0.0 1.8 5.9

Commercial and industrial loans 0.0 0.0 0.0 0.0 1.2 0.0 0.0 0.0 0.0 0.0

All other loans, leases, and other assets 0.4 0.5 0.5 0.3 0.3 0.0 0.0 0.1 2.2 0.4

Total loans, leases, and other assets 3.3 2.8 3.5 3.3 3.0 0.0 1.7 1.0 2.5 3.5

Securitized Loans, Leases, and Other Assets 90 Days or More Past Due (%) 

1-4 family residential loans 1.6 1.6 2.0 2.1 2.1 0.0 1.3 0.5 1.3 1.6

Home equity loans 45.5 47.3 47.8 47.4 46.5 0.0 0.0 0.0 47.6 0.0

Credit card receivables 0.3 0.3 0.3 0.3 0.3 0.0 0.0 0.0 0.2 1.0

Auto loans 0.2 0.2 0.2 0.2 0.1 0.0 0.0 0.4 0.2 0.0

Other consumer loans 3.6 3.9 3.9 4.4 4.4 0.0 0.0 0.0 0.9 6.5

Commercial and industrial loans 0.1 0.1 1.0 1.2 1.8 0.0 2.5 0.0 0.0 0.0

All other loans, leases, and other assets 1.3 1.4 1.2 1.2 1.4 0.0 10.7 0.4 0.3 1.4

Total loans, leases, and other assets 1.5 1.6 1.9 2.0 2.0 0.0 1.7 0.5 1.1 1.6

Securitized Loans, Leases, and Other Assets Charged-off 

(net, YTD, annualized, %) 

1-4 family residential loans 0.2 0.1 0.4 0.3 0.2 0.0 0.1 0.0 0.0 0.2

Home equity loans 2.2 1.0 5.2 3.2 1.8 0.0 0.0 0.0 2.3 0.0

Credit card receivables 3.4 3.0 1.8 1.4 0.8 0.0 0.0 0.0 3.4 1.9

Auto loans 0.3 0.3 0.4 0.2 0.1 0.0 0.0 0.6 0.2 0.0

Other consumer loans 0.5 0.2 0.8 0.6 0.3 0.0 0.0 0.0 0.4 0.7

Commercial and industrial loans 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

All other loans, leases, and other assets 0.4 0.1 0.6 0.5 0.3 0.0 0.0 0.0 0.0 0.4

Total loans, leases, and other assets 0.2 0.1 0.4 0.3 0.2 0.0 0.1 0.1 0.4 0.2

Seller’s Interests in Institution's Own Securitizations – Carried as Loans 

Home equity loans 0 0 0 0 0 0.0 0 0 0 0 0

Credit card receivables 11,954 12,811 15,059 13,248 10,380 15.2 0 0 0 11,954 0

Commercial and industrial loans 219 268 0 0 0 0.0 0 0 0 0 219

Seller’s Interests in Institution's Own Securitizations – Carried as Securities 

Home equity loans 0 0 0 0 0 0.0 0 0 0 0 0

Credit card receivables 0 0 0 0 0 0.0 0 0 0 0 0

Commercial and industrial loans 0 0 0 0 0 0.0 0 0 0 0 0

Assets Sold with Recourse and Not Securitized 

Number of institutions reporting asset sales 1,085 1,088 1,088 1,099 1,106 -1.9 118 722 191 46 8

Outstanding Principal Balance by Asset Type 

1-4 family residential loans 36,555 36,814 38,582 39,013 38,992 -6.3 946 16,300 8,564 4,151 6,594

Home equity, credit card receivables, auto, and other consumer loans 733 684 712 714 742 -1.2 0 102 28 36 567

Commercial and industrial loans 334 265 215 217 80 317.5 0 12 132 163 27

All other loans, leases, and other assets 80,679 79,258 73,499 72,201 74,990 7.6 0 14 1,230 20,461 58,974

Total sold and not securitized 118,301 117,021 113,008 112,145 114,804 3.0 946 16,428 9,954 24,812 66,162

Maximum Credit Exposure by Asset Type 

1-4 family residential loans 10,813 9,491 10,017 10,495 10,436 3.6 80 3,737 3,349 2,239 1,408

Home equity, credit card receivables, auto, and other consumer loans 233 161 163 134 136 71.3 0 102 4 3 124

Commercial and industrial loans 180 175 151 154 16 1,025.0 0 12 5 163 0

All other loans, leases, and other assets 22,185 21,677 20,138 19,655 19,652 12.9 0 12 119 6,139 15,916

Total credit exposure 33,411 31,504 30,470 30,438 30,240 10.5 80 3,863 3,477 8,544 17,448

Support for Securitization Facilities Sponsored by Other Institutions 

Number of institutions reporting securitization facilities sponsored by others 109 110 111 110 110 -0.9 9 56 24 14 6

Total credit exposure 42,341 41,078 41,500 42,211 44,649 -5.2 8 137 226 2,741 39,230

Total unused liquidity commitments 2,853 1,387 834 884 2,005 42.3 0 13 2 612 2,227

Other

Assets serviced for others* 0 0 0 0 0 0.0 0 0 0 0 0

Asset-backed commercial paper conduits 

Credit exposure to conduits sponsored by institutions and others 21,665 18,378 13,980 12,020 12,284 76.4 4 1 0 0 21,660

Unused liquidity commitments to conduits sponsored by institutions 

 and others 24,287 26,866 29,257 27,631 27,902 -13.0 0 0 5 3,276 21,006

Net servicing income (for the quarter) 1,166 864 3,328 1,040 4,546 -74.4 6 241 136 460 324

Net securitization income (for the quarter) 181 203 250 348 325 -44.3 0 9 7 164 1

Total credit exposure to Tier 1 capital (%)** 5.3 5.1 5.2 5.3 5.5 0.7 3.2 2.1 2.8 8.1

* The amount of financial assets serviced for others, other than closed-end 1-4 family residential mortgages, is reported when these assets are greater than $10 million.

** Total credit exposure includes the sum of the three line items titled “Total credit exposure” reported above.

QUARTERLY BANKING PROFILE

FDIC QUARTERLY 15

COMMUNITY BANK PERFORMANCE

Community banks are identified based on criteria defined in the FDIC’s Community Banking Study. When comparing 

community bank performance across quarters, prior-quarter dollar amounts are based on community banks designated 

in the current quarter, adjusted for mergers. In contrast, prior-quarter performance ratios are based on community banks 

designated during the previous quarter.

Earnings of $5.5 Billion Increase 9 Percent From Second Quarter 2015

Higher Net Interest Income and Noninterest Income Improve Earnings

Net Interest Margin Remains Stable From the Year-Ago Period

Loan and Lease Balances Increase 9.1 Percent From the Year Before

Asset Quality Declines for Commercial and Industrial Loans

Earnings Increase at 

60 Percent of 

Community Banks

With 5,602 community banks in the second quarter, aggregate earnings of $5.5 billion 

increased by $451.3 million (9 percent) from the year-earlier quarter. Higher revenue 

from net interest income and noninterest income lifted earnings, but were offset in part 

by higher loan-loss provisions and noninterest expense. Loan-loss provisions increased by 

$162.9 million (28.1 percent) from second quarter 2015, but only 38 percent of community 

banks reported the increase. Pretax return on assets was 1.34 percent, up 5 basis points from 

the year before, but 25 basis points below that of noncommunity banks. There were 62 fewer 

community banks than in first quarter 2016, with two bank failures.

Net Operating Revenue 

Improves From Second 

Quarter 2015

Net operating revenue totaled $22.8 billion in the second quarter, up $1.5 billion (7.1 percent) 

from the previous year. Higher interest income from non 1-to-4 family real estate loans 

(up $748.8 million, or 10.2 percent) drove the improvement in net interest income (up 

$1.2 billion, or 7.6 percent) from second quarter 2015.1 Community banks reported net 

interest margin (NIM) of 3.58 percent, up 1 basis point from the year earlier, as asset yields 

increased (up 1 basis point) and funding costs remained unchanged. Community banks’ 

NIM was 57 basis points above that of noncommunity banks (3.01 percent). The yearly 

increase in noninterest income (up $278.1 million, or 5.7 percent) was led by net gains on 

loan sales (up $163.3 million, or 14.6 percent).

Contributors to the Year-Over-Year Change in Income 

FDIC-Insured Community Banks 

Source: FDIC.

$ Billions

Net

Income NetInterest

Income

Loan Loss

Provisions NoninterestIncome NoninterestExpense RealizedGains on

Securities

Income

Taxes

Positive Factor Negative Factor

-0.5

0.0

0.5

1.0

1.5

$0.45 $1.24 $0.16 $0.28 $0.80 $0.13 $0.24

+9% +8% +28% +6% +6% +117% +16%

Chart 1

Source: FDIC.

Net Interest Margin 

Percent

3.0 

3.5 

4.0 

Community Banks

All Insured Institutions 

3.57 3.58

3.07 3.08

2008 2009 2010 2011 2012 2013 2014 2015 2016

Chart 2

1 Non 1-to-4 family real estate loan income includes construction and development, farmland, multifamily, and nonfarm 

nonresidential.
2 0 1 6  •Volume 1 0  • Number 3

16 FDIC QUARTERLY

Change in Loan Balances and Unused Commitments 

FDIC-Insured Community Banks 

Source: FDIC.

$ Billions

Change 2Q 2016 vs. 2Q 2015

Change 2Q 2016 vs. 1Q 2016

Loan Balances

Unused

Commitments

Nonfarm

Nonresidential

RE

C&I

Loans

1-to-4 Family

Residential

RE

C&D

Loans

Agricultural

Production

Loans

CRE &

C&D

C&I

Loans

39.5

15.7 13.5

19.6

2.6

13.0

5.9

11.8

5.4

8.3

3.0 1.9

5.0

-0.8

Chart 3

Noncurrent Loan Rates for FDIC-Insured Community Banks

Source: FDIC.

Percent of Loan Portfolio Noncurrent

0

2

4

6

8

10

12

14

16

C&D Loans Nonfarm Nonresidential RE

1-to-4 Family RE

C&I Loans Home Equity 

Credit Cards

2008 2009 2010 2011 2012 2013 2014 2015 2016

Chart 4

Noninterest Expense Grows 

5.6 Percent From the 

Previous Year

Noninterest expense rose by $801.4 million (5.6 percent) from the year before, as salary and 

employee benefits increased by $560.3 million (7 percent). Close to 70 percent of community banks reported higher noninterest expense. Full-time employees increased by 13,235 

(3.1 percent) from second quarter 2015, while the average asset per employee rose from 

$4.7 million to $4.9 million. Noninterest expense as a percent of net operating revenue 

totaled 66.6 percent, down from 68 percent a year earlier.

Community Banks Increase 

Their Loan and Lease 

Balances

Loan and lease balances increased by $41.2 billion (2.9 percent) from first quarter 2016 to 

$1.5 trillion. With almost three out of every four community banks (74 percent) increasing their loans from the previous quarter, the quarterly growth rate at community banks 

outperformed that of noncommunity banks (1.9 percent). The quarterly increase among 

community banks was led by nonfarm nonresidential loans (up $11.8 billion, or 2.8 percent), 

1-to-4 family residential mortgages (up $8.3 billion, or 2.2 percent), commercial and industrial loans (up $5.4 billion, or 2.8 percent), multifamily residential mortgages (up $4.2 billion, 

or 4.5 percent), and construction and development loans (up $3 billion, or 3.2 percent). Loan 

and lease balances were $122.8 billion (9.1 percent) higher than in second quarter 2015, with 

almost 80 percent of community banks growing their loans. The 12-month loan growth rate 

at community banks was 2.6 percentage points higher than that of noncommunity banks 

(6.5 percent). Almost half (48 percent) of the yearly increase in loan and lease balances at 

community banks was led by nonfarm nonresidential loans (up $39.5 billion, or 10.1 percent) 

and 1-to-4 family residential mortgages (up $19.6 billion, or 5.4 percent). Unused loan 

commitments increased $9.6 billion (3.5 percent) to $281.3 billion from a year earlier, with 

commercial real estate, including construction and development, growing $13 billion 

(18.6 percent).
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 17

Growth in Small Loans to 

Businesses Outpaces 

Noncommunity Banks

Community banks reported $300.7 billion in small loans to businesses for the current quarter, up $3.9 billion (1.3 percent) from the first quarter.2

 The quarter-over-quarter increase in 

small loans to businesses at community banks surpassed that of noncommunity banks (up 

$2.6 billion, or 0.7 percent). Close to 64 percent of the quarterly increase was led by commercial and industrial loans (up $1.4 billion, or 1.5 percent) and nonfarm nonresidential loans 

(up $1.1 billion, or 0.8 percent). Meanwhile, nonfarm nonresidential loans for noncommunity banks declined (down $1.5 billion, or 1 percent). For the past 11 consecutive quarters, 

nonfarm nonresidential loans as a percent of small loans to businesses declined for noncommunity banks, down from 41 percent in third quarter 2013 to 36 percent in the current quarter. Community banks increased small loans to businesses by $9.5 billion (3.2 percent) from 

12 months ago, exceeding 2.8 percent growth at noncommunity banks. The annual increase 

at community banks was attributed to nonfarm nonresidential loans (up $3.8 billion, or 

2.7 percent) and commercial and industrial loans (up $3.6 billion, or 4 percent). Community 

banks continued to hold 44 percent of small loans to businesses.

Noncurrent Loan and Lease 

Balances Decline

Noncurrent loan and lease balances declined $354.4 million (2.2 percent) from the previous 

quarter, with more than half (53 percent) of community banks reducing these balances. The 

coverage ratio—reserves for loan losses to noncurrent loans—increased from 116.1 percent 

in first quarter 2016 to 119.5 percent, as noncurrent loan and lease balances declined and 

reserves for loan losses increased (up $123.3 million, or 0.7 percent). Almost two out of 

every three community banks (61 percent) increased their reserves for loan losses. However, 

reserves for loan losses as a percent of total loans was 1.26 percent in the second quarter, 

down 2 basis points from the previous quarter, the lowest level since second quarter 2008.

Asset Quality Improves for 

All Major Loan Categories 

Except Commercial and 

Industrial Loans

The noncurrent rate at community banks was 1.05 percent in second quarter 2016, down 

6 basis points from first quarter 2016 and 53 basis points below that of noncommunity 

banks (1.58 percent). All major loan categories reported lower noncurrent rates except for 

commercial and industrial loans (up 1 basis point). The noncurrent rate for commercial and 

industrial loans (1.21 percent) increased for a fourth consecutive quarter and was 19 basis 

points higher than the year before. Construction and development loans had the largest 

decline (down 15 basis points) in the noncurrent rate from first quarter 2016. Quarterly net 

charge-offs of $466.8 million remained flat from the year-ago quarter and the net chargeoff rate declined 1 basis point to 0.13 percent, the lowest rate for a second quarter in the last 

ten years. All major loan categories had lower net charge-off rates from the year-ago quarter 

except for commercial and industrial loans (up 10 basis points). Nonfarm nonresidential 

loans had the largest year-over-year decline (down 8 basis points) in the net charge-off rate.

Author:

Benjamin Tikvina

Senior Financial Analyst 

Division of Insurance and Research

(202) 898-6578

2 Small loans to businesses consist of loans to commercial borrowers up to $1 million and farm loans up to $500,000.
2 0 1 6  •Volume 1 0  • Number 3

18 FDIC QUARTERLY

TABLE I-B. Selected Indicators, FDIC-Insured Community Banks

2016* 2015* 2015 2014 2013 2012 2011

Return on assets (%) 1.00 0.99 0.99 0.93 0.90 0.83 0.55

Return on equity (%) 8.94 8.89 8.88 8.45 8.28 7.68 5.19

Core capital (leverage) ratio (%) 10.70 10.71 10.67 10.57 10.43 10.18 9.98

Noncurrent assets plus other real estate owned to assets (%) 1.00 1.21 1.06 1.34 1.73 2.26 2.84

Net charge-offs to loans (%) 0.11 0.12 0.15 0.21 0.32 0.58 0.87

Asset growth rate (%) 2.94 3.20 2.71 2.31 0.33 2.25 1.60

Net interest margin (%) 3.57 3.56 3.57 3.61 3.59 3.67 3.74

Net operating income growth (%) 3.74 9.85 9.94 4.86 14.61 56.25 207.82

Number of institutions reporting 5,602 5,881 5,735 6,037 6,306 6,541 6,798

Percentage of unprofitable institutions (%) 4.50 5.37 4.95 6.44 8.40 11.15 16.34

* Through June 30, ratios annualized where appropriate. Asset growth rates are for 12 months ending June 30.

TABLE II-B. Aggregate Condition and Income Data, FDIC-Insured Community Banks

(dollar figures in millions)  2nd Quarter

2016

1st Quarter

2016

2nd Quarter

2015

%Change 

15Q2-16Q2

Number of institutions reporting 5,602 5,664 5,881 -4.7

Total employees (full-time equivalent) 436,777 434,793 442,060 -1.2

CONDITION DATA

Total assets $2,146,426 $2,127,880 $2,085,055 2.9

Loans secured by real estate 1,126,343 1,102,253 1,064,927 5.8

 1-4 Family residential mortgages 382,428 376,260 373,655 2.3

 Nonfarm nonresidential 430,722 421,245 407,575 5.7

 Construction and development 97,572 95,231 87,844 11.1

 Home equity lines 50,658 49,937 50,051 1.2

Commercial & industrial loans 201,667 196,759 193,522 4.2

Loans to individuals 60,817 59,513 60,273 0.9

 Credit cards 2,119 2,080 2,153 -1.5

Farm loans 51,275 49,451 48,760 5.2

Other loans & leases 38,983 36,949 35,027 11.3

Less: Unearned income 633 630 568 11.6

Total loans & leases 1,478,451 1,444,295 1,401,942 5.5

Less: Reserve for losses 18,581 18,546 18,814 -1.2

Net loans and leases 1,459,871 1,425,749 1,383,128 5.5

Securities 427,803 434,583 443,565 -3.6

Other real estate owned 5,841 6,257 7,744 -24.6

Goodwill and other intangibles 14,272 13,943 13,603 4.9

All other assets 238,639 247,347 237,015 0.7

Total liabilities and capital 2,146,426 2,127,880 2,085,055 2.9

Deposits 1,752,772 1,748,382 1,708,626 2.6

 Domestic office deposits 1,752,363 1,747,962 1,708,188 2.6

 Foreign office deposits 409 420 438 -6.6

 Brokered deposits 75,246 72,895 67,369 11.7

Estimated insured deposits 1,318,121 1,319,444 1,308,556 0.7

Other borrowed funds 132,253 123,675 127,407 3.8

Subordinated debt 831 580 524 58.7

All other liabilities 17,255 16,292 15,634 10.4

Total equity capital (includes minority interests) 243,315 238,951 232,864 4.5

 Bank equity capital 243,213 238,853 232,745 4.5

Loans and leases 30-89 days past due 7,822 9,045 8,189 -4.5

Noncurrent loans and leases 15,552 15,974 17,334 -10.3

Restructured loans and leases 8,809 8,928 9,943 -11.4

Mortgage-backed securities 183,322 185,183 189,050 -3.0

Earning assets 1,995,825 1,979,601 1,933,575 3.2

FHLB Advances 103,807 95,105 95,914 8.2

Unused loan commitments 281,309 277,829 282,001 -0.2

Trust assets 261,711 258,830 247,765 5.6

Assets securitized and sold 16,616 16,363 14,460 14.9

Notional amount of derivatives 70,320 61,969 58,250 20.7

INCOME DATA

First Half 

2016

First Half 

2015 %Change

2nd Quarter 

2016

2nd Quarter 

2015

%Change 

15Q2-16Q2

Total interest income $39,523 $38,216 3.4 $19,986 $19,349 3.3

Total interest expense 4,509 4,361 3.4 2,285 2,189 4.4

Net interest income 35,015 33,855 3.4 17,701 17,160 3.2

Provision for loan and lease losses 1,371 1,131 21.2 743 586 26.6

Total noninterest income 9,781 9,897 -1.2 5,140 5,096 0.9

Total noninterest expense 30,004 29,845 0.5 15,206 15,130 0.5

Securities gains (losses) 416 358 16.1 240 117 105.5

Applicable income taxes 3,242 2,957 9.6 1,672 1,406 18.9

Extraordinary gains, net 2 22 -91.1 1 22 N/M

Total net income (includes minority interests) 10,596 10,200 3.9 5,460 5,272 3.6

 Bank net income 10,585 10,183 3.9 5,454 5,265 3.6

Net charge-offs 818 844 -3.1 467 488 -4.3

Cash dividends 5,044 4,702 7.3 2,526 2,492 1.4

Retained earnings 5,542 5,482 1.1 2,927 2,773 5.6

Net operating income 10,266 9,896 3.7 5,272 5,156 2.2

N/M - Not Meaningful
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 19

TABLE II-B. Aggregate Condition and Income Data, FDIC-Insured Community Banks

Prior Periods Adjusted for Mergers

(dollar figures in millions)  2nd Quarter 

2016

1st Quarter 

2016

2nd Quarter

2015

%Change 

15Q2-16Q2

Number of institutions reporting 5,602 5,602 5,601 0.0

Total employees (full-time equivalent) 436,777 430,192 423,542 3.1

CONDITION DATA

Total assets $2,146,426 $2,118,886 $2,022,240 6.1

Loans secured by real estate 1,126,343 1,095,973 1,028,855 9.5

 1-4 Family residential mortgages 382,428 374,091 362,875 5.4

 Nonfarm nonresidential 430,722 418,957 391,248 10.1

 Construction and development 97,572 94,549 84,067 16.1

 Home equity lines 50,658 49,610 47,588 6.5

Commercial & industrial loans 201,667 196,238 185,934 8.5

Loans to individuals 60,817 59,397 58,158 4.6

 Credit cards 2,119 2,080 2,168 -2.2

Farm loans 51,275 49,349 48,647 5.4

Other loans & leases 38,983 36,910 34,595 12.7

Less: Unearned income 633 628 553 14.5

Total loans & leases 1,478,451 1,437,239 1,355,636 9.1

Less: Reserve for losses 18,581 18,457 18,226 1.9

Net loans and leases 1,459,871 1,418,782 1,337,410 9.2

Securities 427,803 433,570 434,242 -1.5

Other real estate owned 5,841 6,223 7,430 -21.4

Goodwill and other intangibles 14,272 13,879 13,182 8.3

All other assets 238,639 246,431 229,975 3.8

Total liabilities and capital 2,146,426 2,118,886 2,022,240 6.1

Deposits 1,752,772 1,741,196 1,657,318 5.8

 Domestic office deposits 1,752,363 1,740,784 1,656,898 5.8

 Foreign office deposits 409 412 420 -2.5

 Brokered deposits 75,246 72,274 65,004 15.8

Estimated insured deposits 1,318,121 1,313,387 1,271,499 3.7

Other borrowed funds 132,253 123,045 123,091 7.4

Subordinated debt 831 580 455 82.9

All other liabilities 17,255 16,200 15,132 14.0

Total equity capital (includes minority interests) 243,315 237,864 226,245 7.5

 Bank equity capital 243,213 237,766 226,134 7.6

Loans and leases 30-89 days past due 7,822 9,014 8,029 -2.6

Noncurrent loans and leases 15,552 15,906 16,756 -7.2

Restructured loans and leases 8,809 8,873 9,577 -8.0

Mortgage-backed securities 183,322 184,476 183,335 0.0

Earning assets 1,995,825 1,971,338 1,875,375 6.4

FHLB Advances 103,807 94,580 92,193 12.6

Unused loan commitments 281,309 276,396 271,700 3.5

Trust assets 261,711 258,830 246,829 6.0

Assets securitized and sold 16,616 15,922 13,996 18.7

Notional amount of derivatives 70,320 60,337 53,529 31.4

INCOME DATA

First Half 

2016

First Half 

2015 %Change

2nd Quarter 

2016

2nd Quarter 

2015

%Change 

15Q2-16Q2

Total interest income $39,523 $36,620 7.9 $19,986 $18,557 7.7

Total interest expense 4,509 4,182 7.8 2,285 2,100 8.8

Net interest income 35,015 32,438 7.9 17,701 16,457 7.6

Provision for loan and lease losses 1,371 1,110 23.5 743 580 28.1

Total noninterest income 9,781 9,395 4.1 5,140 4,862 5.7

Total noninterest expense 30,004 28,387 5.7 15,206 14,405 5.6

Securities gains (losses) 416 341 21.9 240 111 116.9

Applicable income taxes 3,242 2,891 12.1 1,672 1,436 16.4

Extraordinary gains, net 2 1 N/M 1 0 N/M

Total net income (includes minority interests) 10,596 9,788 8.3 5,460 5,009 9.0

 Bank net income 10,585 9,772 8.3 5,454 5,002 9.0

Net charge-offs 818 800 2.2 467 467 0.0

Cash dividends 5,044 4,595 9.8 2,526 2,411 4.8

Retained earnings 5,542 5,178 7.0 2,927 2,591 13.0

Net operating income 10,266 9,520 7.8 5,272 4,920 7.2

N/M - Not Meaningful
2 0 1 6  •Volume 1 0  • Number 3

20 FDIC QUARTERLY

TABLE III-B. Aggregate Condition and Income Data by Geographic Region, FDIC-Insured Community Banks

Second Quarter 2016

(dollar figures in millions) All Community Banks

Geographic Regions*

New York Atlanta Chicago Kansas City Dallas San Francisco

Number of institutions reporting 5,602 648 681 1,229 1,462 1,216 366

Total employees (full-time equivalent) 436,777 87,687 54,098 90,480 70,990 96,061 37,461

CONDITION DATA

Total assets $2,146,426 $569,576 $247,719 $387,064 $331,413 $417,658 $192,996

Loans secured by real estate 1,126,343 342,819 137,068 196,643 153,334 196,962 99,516

 1-4 Family residential mortgages 382,428 129,284 44,475 70,517 49,389 64,444 24,320

 Nonfarm nonresidential 430,722 121,471 58,564 71,709 50,244 79,864 48,871

 Construction and development 97,572 19,507 15,784 12,723 12,688 28,289 8,580

 Home equity lines 50,658 17,212 7,552 11,399 4,769 4,581 5,143

Commercial & industrial loans 201,667 49,938 19,244 37,457 33,284 42,889 18,855

Loans to individuals 60,817 12,860 6,959 11,899 10,001 13,795 5,302

 Credit cards 2,119 454 129 419 511 303 303

Farm loans 51,275 537 1,361 7,964 28,327 10,151 2,935

Other loans & leases 38,983 12,178 3,108 6,672 5,730 7,828 3,466

Less: Unearned income 633 169 126 59 49 125 106

Total loans & leases 1,478,451 418,164 167,615 260,577 230,626 271,500 129,969

Less: Reserve for losses 18,581 4,543 2,122 3,410 3,129 3,573 1,803

Net loans and leases 1,459,871 413,621 165,493 257,166 227,497 267,927 128,165

Securities 427,803 96,955 47,216 82,705 67,297 95,448 38,183

Other real estate owned 5,841 881 1,513 1,085 874 1,160 328

Goodwill and other intangibles 14,272 4,732 1,286 2,294 1,782 2,670 1,508

All other assets 238,639 53,387 32,211 43,814 33,963 50,452 24,812

Total liabilities and capital 2,146,426 569,576 247,719 387,064 331,413 417,658 192,996

Deposits 1,752,772 450,063 204,462 318,854 270,355 348,583 160,455

 Domestic office deposits 1,752,363 449,707 204,452 318,832 270,355 348,583 160,433

 Foreign office deposits 409 356 9 22 0 0 22

 Brokered deposits 75,246 25,127 7,345 12,619 11,470 11,614 7,070

 Estimated insured deposits 1,318,121 327,568 155,404 254,902 213,686 256,065 110,496

Other borrowed funds 132,253 48,839 13,425 20,912 21,522 19,488 8,067

Subordinated debt 831 673 20 77 17 6 40

All other liabilities 17,255 5,894 1,812 2,969 2,008 2,717 1,855

Total equity capital (includes minority interests) 243,315 64,107 28,000 44,252 37,511 46,864 22,580

 Bank equity capital 243,213 64,054 27,988 44,235 37,510 46,847 22,579

Loans and leases 30-89 days past due 7,822 1,919 989 1,430 1,236 1,815 434

Noncurrent loans and leases 15,552 5,385 1,864 2,792 1,778 2,845 889

Restructured loans and leases 8,809 2,511 1,296 2,179 1,007 1,136 679

Mortgage-backed securities 183,322 54,173 20,621 32,246 22,219 35,672 18,390

Earning assets 1,995,825 532,415 228,302 359,380 309,380 386,420 179,927

FHLB Advances 103,807 41,375 10,820 15,205 15,726 15,563 5,118

Unused loan commitments 281,309 72,926 30,357 51,695 46,420 50,956 28,955

Trust assets 261,711 58,637 10,187 65,449 74,577 42,913 9,948

Assets securitized and sold 16,616 3,481 77 6,030 795 623 5,610

Notional amount of derivatives 70,320 24,896 8,234 12,389 9,215 9,206 6,380

INCOME DATA

Total interest income $19,986 $5,063 $2,345 $3,508 $3,164 $4,084 $1,823

Total interest expense 2,285 746 263 391 365 385 135

Net interest income 17,701 4,317 2,082 3,117 2,799 3,699 1,688

Provision for loan and lease losses 743 231 76 96 114 186 40

Total noninterest income 5,140 993 596 1,259 768 985 539

Total noninterest expense 15,206 3,552 1,896 2,917 2,304 3,104 1,433

Securities gains (losses) 240 71 29 41 31 47 22

Applicable income taxes 1,672 502 181 334 197 219 238

Extraordinary gains, net 1 0 0 0 0 0 0

Total net income (includes minority interests) 5,460 1,095 554 1,070 982 1,221 537

 Bank net income 5,454 1,094 553 1,069 982 1,220 537

Net charge-offs 467 136 60 78 53 127 12

Cash dividends 2,526 362 194 581 564 597 229

Retained earnings 2,927 732 359 488 418 623 308

Net operating income 5,272 1,043 533 1,037 956 1,181 522

* See Table V-A (page 11) for explanations.
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 21

Table IV-B. Second Quarter 2016, FDIC-Insured Community Banks

Performance ratios (annualized, %)

All Community Banks Second Quarter 2016, Geographic Regions*

 2nd Quarter 

2016

1st Quarter 

2016 New York Atlanta Chicago Kansas City Dallas San Francisco

Yield on earning assets 4.04 4.02 3.85 4.16 3.94 4.11 4.25 4.08

Cost of funding earning assets 0.46 0.46 0.57 0.47 0.44 0.47 0.40 0.30

Net interest margin 3.58 3.56 3.28 3.69 3.50 3.63 3.85 3.78

Noninterest income to assets 0.97 0.89 0.71 0.97 1.31 0.93 0.95 1.13

Noninterest expense to assets 2.86 2.84 2.52 3.10 3.04 2.79 2.99 3.00

Loan and lease loss provision to assets 0.14 0.12 0.16 0.12 0.10 0.14 0.18 0.08

Net operating income to assets 0.99 0.95 0.74 0.87 1.08 1.16 1.14 1.09

Pretax return on assets 1.34 1.28 1.13 1.20 1.46 1.43 1.39 1.62

Return on assets 1.03 0.98 0.78 0.90 1.11 1.19 1.18 1.12

Return on equity 9.09 8.74 6.92 8.04 9.81 10.59 10.54 9.64

Net charge-offs to loans and leases 0.13 0.10 0.13 0.15 0.12 0.09 0.19 0.04

Loan and lease loss provision to net charge-offs 159.07 178.12 169.42 126.77 123.07 214.26 145.96 329.06

Efficiency ratio 66.24 67.24 66.54 70.43 66.35 64.23 65.99 64.04

Net interest income to operating revenue 77.50 78.84 81.30 77.74 71.22 78.47 78.97 75.79

% of unprofitable institutions 4.69 5.21 6.79 6.75 5.61 3.21 3.13 5.19

% of institutions with earnings gains 60.03 61.51 61.27 62.26 60.62 58.28 59.46 60.66

Table V-B. First Half 2016, FDIC-Insured Community Banks

Performance ratios (%)

All Community Banks First Half 2016, Geographic Regions*

First Half 

2016

First Half 

2015 New York Atlanta Chicago Kansas City Dallas San Francisco

Yield on earning assets 4.03 4.01 3.85 4.16 3.92 4.08 4.24 4.07

Cost of funding earning assets 0.46 0.46 0.56 0.47 0.44 0.47 0.40 0.30

Net interest margin 3.57 3.56 3.28 3.69 3.49 3.61 3.84 3.77

Noninterest income to assets 0.93 0.96 0.69 0.93 1.26 0.88 0.93 1.04

Noninterest expense to assets 2.84 2.91 2.52 3.08 3.03 2.76 2.98 2.98

Loan and lease loss provision to assets 0.13 0.11 0.14 0.11 0.10 0.13 0.18 0.08

Net operating income to assets 0.97 0.96 0.74 0.84 1.05 1.13 1.13 1.04

Pretax return on assets 1.31 1.28 1.13 1.18 1.41 1.40 1.37 1.54

Return on assets 1.00 0.99 0.77 0.87 1.08 1.16 1.17 1.07

Return on equity 8.94 8.89 6.87 7.78 9.55 10.42 10.54 9.22

Net charge-offs to loans and leases 0.11 0.12 0.11 0.12 0.11 0.09 0.17 0.04

Loan and lease loss provision to net charge-offs 167.63 134.12 173.44 143.24 123.85 204.85 166.35 333.67

Efficiency ratio 66.65 67.87 66.87 70.60 67.07 64.50 66.13 65.04

Net interest income to operating revenue 78.17 77.38 81.71 78.46 72.03 79.27 79.34 77.10

% of unprofitable institutions 4.50 5.37 5.56 7.05 5.70 2.87 2.88 5.74

% of institutions with earnings gains 62.30 62.98 61.42 63.44 61.51 60.26 64.80 64.21

* See Table V-A (page 11) for explanations.
2 0 1 6  •Volume 1 0  • Number 3

22 FDIC QUARTERLY

Table VI-B. Loan Performance, FDIC-Insured Community Banks

June 30, 2016

Geographic Regions*

All Community Banks New York Atlanta Chicago Kansas City Dallas San Francisco

Percent of Loans 30-89 Days Past Due

All loans secured by real estate 0.49 0.42 0.56 0.57 0.48 0.58 0.28

Construction and development 0.43 0.38 0.47 0.58 0.35 0.47 0.26

Nonfarm nonresidential 0.31 0.28 0.31 0.39 0.36 0.35 0.17

Multifamily residential real estate 0.12 0.09 0.11 0.21 0.24 0.14 0.02

Home equity loans 0.38 0.42 0.44 0.40 0.31 0.43 0.21

Other 1-4 family residential 0.79 0.68 0.99 0.88 0.65 0.98 0.60

Commercial and industrial loans 0.53 0.43 0.54 0.39 0.61 0.70 0.48

Loans to individuals 1.44 1.76 1.54 0.91 0.99 2.15 0.78

Credit card loans 1.81 2.18 1.00 1.17 3.17 0.93 1.08

Other loans to individuals 1.43 1.75 1.55 0.90 0.87 2.18 0.76

All other loans and leases (including farm) 0.44 0.28 0.28 0.37 0.58 0.38 0.41

Total loans and leases 0.53 0.46 0.59 0.55 0.54 0.67 0.33

Percent of Loans Noncurrent**

All loans secured by real estate 1.05 1.23 1.19 1.16 0.77 0.93 0.65

Construction and development 1.24 1.25 2.10 1.24 1.19 0.87 0.96

Nonfarm nonresidential 0.93 1.10 0.99 1.10 0.85 0.79 0.53

Multifamily residential real estate 0.32 0.20 0.71 0.60 0.44 0.44 0.10

Home equity loans 0.69 0.83 0.61 0.73 0.31 0.64 0.66

Other 1-4 family residential 1.36 1.78 1.26 1.41 0.72 1.19 0.90

Commercial and industrial loans 1.21 1.38 0.80 1.00 0.95 1.70 0.96

Loans to individuals 0.69 0.68 0.84 0.37 0.45 1.23 0.29

Credit card loans 0.97 1.37 0.43 0.90 1.19 0.63 0.64

Other loans to individuals 0.68 0.65 0.85 0.35 0.41 1.25 0.27

All other loans and leases (including farm) 0.98 3.02 0.48 0.61 0.67 0.68 0.68

Total loans and leases 1.05 1.29 1.11 1.07 0.77 1.05 0.68

Percent of Loans Charged-Off (net, YTD)

All loans secured by real estate 0.04 0.06 0.06 0.07 0.02 0.03 -0.03

Construction and development 0.01 0.06 0.13 0.05 -0.05 -0.05 -0.13

Nonfarm nonresidential 0.04 0.05 0.04 0.06 0.03 0.04 -0.02

Multifamily residential real estate 0.01 0.01 0.02 0.04 0.04 -0.01 -0.02

Home equity loans 0.07 0.09 0.07 0.11 0.00 0.04 0.01

Other 1-4 family residential 0.07 0.09 0.07 0.10 0.04 0.05 -0.01

Commercial and industrial loans 0.27 0.27 0.28 0.20 0.17 0.44 0.16

Loans to individuals 0.77 0.89 0.74 0.55 0.88 0.84 0.60

Credit card loans 4.94 4.06 1.26 3.52 12.03 1.26 1.95

Other loans to individuals 0.61 0.77 0.73 0.44 0.28 0.83 0.51

All other loans and leases (including farm) 0.20 0.18 0.24 0.15 0.09 0.46 0.19

Total loans and leases 0.11 0.11 0.12 0.11 0.09 0.17 0.04

Loans Outstanding (in billions)

All loans secured by real estate $1,126.3 $342.8 $137.1 $196.6 $153.3 $197.0 $99.5

Construction and development 97.6 19.5 15.8 12.7 12.7 28.3 8.6

Nonfarm nonresidential 430.7 121.5 58.6 71.7 50.2 79.9 48.9

Multifamily residential real estate 98.8 53.3 6.4 14.6 7.9 7.4 9.3

Home equity loans 50.7 17.2 7.6 11.4 4.8 4.6 5.1

Other 1-4 family residential 382.4 129.3 44.5 70.5 49.4 64.4 24.3

Commercial and industrial loans 201.7 49.9 19.2 37.5 33.3 42.9 18.9

Loans to individuals 60.8 12.9 7.0 11.9 10.0 13.8 5.3

Credit card loans 2.1 0.5 0.1 0.4 0.5 0.3 0.3

Other loans to individuals 58.7 12.4 6.8 11.5 9.5 13.5 5.0

All other loans and leases (including farm) 90.3 12.7 4.5 14.6 34.1 18.0 6.4

Total loans and leases 1,479.1 418.3 167.7 260.6 230.7 271.6 130.1

Memo: Unfunded Commitments (in millions)

Total Unfunded Commitments 281,309 72,926 30,357 51,695 46,420 50,956 28,955

Construction and development: 1-4 family residential 23,961 5,042 4,190 2,669 2,931 6,507 2,622

Construction and development: CRE and other 57,084 17,564 7,705 8,117 6,503 12,511 4,684

Commercial and industrial 88,950 22,104 8,168 18,296 14,456 16,337 9,588

* See Table V-A (page 11) for explanations.

** Noncurrent loan rates represent the percentage of loans in each category that are past due 90 days or more or that are in nonaccrual status.
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 23

Insurance Fund Indicators

Insured Deposits Increase Only 0.2 Percent

DIF Reserve Ratio Rises 4 Basis Points to 1.17 Percent

Several Changes to Assessments Begin in the Third Quarter of 2016

Total assets of the 6,058 FDIC-insured institutions increased by 1.5 percent ($240.6 billion) 

during the second quarter of 2016. Total deposits increased by 0.8 percent ($98.6 billion), 

domestic office deposits increased by 0.9 percent ($94.8 billion), and foreign office deposits increased by 0.3 percent ($3.8 billion). Domestic interest-bearing deposits increased 

by 0.6 percent ($52.2 billion), while noninterest-bearing deposits increased by 1.4 percent 

($42.5 billion). For the 12 months ending June 30, total domestic deposits grew by 

5.8 percent ($614.8 billion), with interest-bearing deposits increasing by 7.5 percent 

($572.8 billion) and noninterest-bearing deposits increasing by 1.4 percent ($42.0 billion).1

Other borrowed money increased by 6 percent, securities sold under agreements to repurchase declined by 15.5 percent, and foreign office deposits declined by 1.4 percent over the 

same 12-month period.2

Total estimated insured deposits increased slightly during the second quarter of 2016 

(0.2 percent increase), compared to a 2.1 percent increase during the previous quarter.3 For 

institutions existing at the start and the end of the most recent quarter, insured deposits 

increased during the quarter at 2,871 institutions (47 percent), decreased at 3,167 institutions (52 percent), and remained unchanged at 29 institutions. Estimated insured deposits 

increased by 5.3 percent over the 12 months ending June 30, 2016.

The Deposit Insurance Fund (DIF) increased by $2.8 billion during the second quarter of 

2016 to $77.9 billion (unaudited). Assessment income of $2.3 billion and a negative provision for insurance losses of $627 million were the main drivers of the fund balance increase. 

Interest on investments of $164 million and unrealized gains on securities of $110 million 

also contributed to fund balance growth. Second quarter operating expenses of $441 million 

offset some of this growth. Two insured institutions, with assets of $122 million, failed 

during the second quarter. The DIF’s reserve ratio was 1.17 percent on June 30, up from 

1.13 percent at March 31, 2016, and 1.07 percent four quarters ago.

Effective April 1, 2011, the deposit insurance assessment base changed to average consolidated total assets minus average tangible equity.4 Table 1 shows the distribution of the assessment base as of June 30, by institution asset size category.

Changes in Assessments Significant changes to deposit insurance assessments take effect in the third quarter of 2016. 

The reserve ratio (the fund balance as a percent of estimated insured deposits) increased to 

1.17 percent in the second quarter of 2016 from 1.13 percent in the prior quarter. Under FDIC 

regulations, several changes to the assessment system take effect beginning the quarter after 

the DIF reserve ratio first reaches or exceeds 1.15 percent.

1 Throughout the insurance fund discussion, FDIC-insured institutions include insured commercial banks and savings 

associations and, except where noted, exclude insured branches of foreign banks. 

2 Other borrowed money includes FHLB advances, term federal funds, mortgage indebtedness, and other borrowings.

3 Figures for estimated insured deposits in this discussion include insured branches of foreign banks, in addition to insured 

commercial banks and savings institutions.

4 There is an additional adjustment to the assessment base for banker’s banks and custodial banks, as permitted under DoddFrank Wall Street Reform and Consumer Protection Act.
2 0 1 6  •Volume 1 0  • Number 3

24 FDIC QUARTERLY

Decrease in Overall Assessment Rates

Overall initial assessment rates will decline from a range of 5 basis points to 35 basis points 

to a range of 3 basis points to 30 basis points beginning in the third quarter, pursuant 

to regulations approved by the FDIC Board of Directors (Board) in February 2011 and 

April 2016. As a result of this change, the FDIC estimates that regular assessments are 

expected to decline by about one third.

New Pricing Method for Established Small Banks

The April 2016 final rule adopted by the Board amends the way insurance assessment rates 

are calculated for established small banks.5,6 The rule updates the data and methodology that 

the FDIC uses to determine risk-based assessment rates for these institutions to better reflect 

risks and to help ensure that banks that take on greater risks pay more for deposit insurance 

than their less risky counterparts.

The rule revises the financial ratios method used to determine assessment rates for these 

banks so that it is based on a statistical model that estimates the probability of failure over 

three years. The rule eliminates risk categories for established small banks and uses the 

financial ratios method for all such banks (subject to minimum or maximum assessment 

rates based on a bank’s CAMELS composite rating).

Changes to assessments approved in the April final rule are revenue neutral; that is, they 

leave aggregate assessment revenue collected from small banks approximately the same as it 

would have been absent the final rule.

Table 2 shows the schedule of initial and total assessment rates that will apply beginning in 

the third quarter of 2016. The rate schedule incorporates both the reduction in initial assessment rates from a range of 5 basis points to 35 basis points to a range of 3 basis points to 

30 basis points and the new pricing method for established small banks. The FDIC estimates 

that assessment rates for approximately 93 percent of small banks will decline with the 

adoption of the new rate schedule.

Distribution of the Assessment Base for FDIC-Insured Institutions* 

by Asset Size

Data as of June 30, 2016

Asset Size Number of Institutions

Percent of 

Total Institutions

Assessment Base** 

($ Bil.) Percent of Base

Less Than $1 Billion 5,327 87.9 $1,119.3 7.9

$1 - $10 Billion 619 10.2 1,522.7 10.7

$10 - $50 Billion 73 1.2 1,484.3 10.5

$50 - $100 Billion 13 0.2 833.2 5.9

Over $100 Billion 26 0.4 9,210.0 65.0

Total 6,058 100.0 14,169.6 100.0

* Excludes insured U.S. branches of foreign banks.

** Average consolidated total assets minus average tangible equity, with adjustments for banker’s banks and custodial banks.

Table 1

5 Generally, banks that have less than $10 billion in assets that have been federally insured for at least five years.

6 https://www.gpo.gov/fdsys/pkg/FR-2016-05-20/pdf/2016-11181.pdf. 
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 25

Initial and Total Base Assessment Rates* 

(in basis points per annum)

After the Reserve Ratio Reaches 1.15 Percent**

Established Small Banks

Large & Highly 

Complex Institutions

CAMELS Composite

1 or 2 3 4 or 5

Initial Base Assessment Rate 3 to 16 6 to 30 16 to 30 3 to 30

Unsecured Debt Adjustment*** -5 to 0 -5 to 0 -5 to 0 -5 to 0

Brokered Deposit Adjustment N/A N/A N/A 0 to 10

Total Base Assessment Rate 1.5 to 16 3 to 30 11 to 30 1.5 to 40

* Total base assessment rates in the table do not include the Depository Institution Debt Adjustment (DIDA).

** The reserve ratio for the immediately prior assessment period must also be less than 2 percent.

*** The unsecured debt adjustment cannot exceed the lesser of 5 basis points or 50 percent of an insured depository institution’s initial base assessment 

rate; thus, for example, an insured depository institution with an initial base assessment rate of 3 basis points will have a maximum unsecured debt 

adjustment of 1.5 basis points and cannot have a total base assessment rate lower than 1.5 basis points.

Table 2

Large Bank Surcharges and Small Bank Assessment Credits

On March 15, 2016, the FDIC Board approved a final rule to increase the DIF to the statutorily required minimum of 1.35 percent of estimated insured deposits.7

 Congress, in the 

Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act), 

increased the minimum DIF reserve ratio from 1.15 percent to 1.35 percent and required that 

the ratio reach that level by September 30, 2020. Further, the Dodd-Frank Act required that, 

in setting assessments, the FDIC offset the effect of the increase in the minimum reserve 

ratio from 1.15 to 1.35 percent on banks with less than $10 billion in assets.

To satisfy these requirements, the final rule imposes on large banks a surcharge of 4.5 basis 

points of their assessment base, after making certain adjustments.8 The surcharges are to 

begin the quarter after the reserve ratio first reaches or surpasses 1.15 percent.9 Therefore, 

beginning with the third quarter 2016 assessment period, large banks will pay quarterly 

surcharges in addition to their lower regular risk-based assessments.

The FDIC expects that surcharges will last eight quarters. In any event, surcharges will 

continue through the quarter in which the reserve ratio first meets or exceeds 1.35 percent, 

but not past the fourth quarter of 2018. If the reserve ratio has not reached 1.35 percent by 

the end of 2018, a shortfall assessment will be imposed on large banks to close the gap.

Small banks will receive credits to offset the portion of their assessments that help to raise 

the reserve ratio from 1.15 percent to 1.35 percent. When the reserve ratio is at or above 

1.38 percent, the FDIC will automatically apply a small bank’s credits to reduce its regular 

assessment up to the entire amount of the assessment.

Author:

Kevin Brown

Senior Financial Analyst

Division of Insurance and Research

(202) 898-6817

7 https://www.federalregister.gov/articles/2016/03/25/2016-06770/assessments. 8 Large banks are, generally, banks with assets of $10 billion or more.

9 The assessment base for the surcharge will be a large bank’s regular assessment base reduced by $10 billion (and subject to 

adjustment for affiliated banks).
2 0 1 6  •Volume 1 0  • Number 3

26 FDIC QUARTERLY

DIF Reserve Ratios

Percent of Insured Deposits

0.84

0.89

1.01 1.03

1.07 1.09

1.13

0.64

0.68

0.79 0.80

1.11

1.17

6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16

Table I-C. Insurance Fund Balances and Selected Indicators

(dollar figures in millions)

Deposit Insurance Fund*

2nd 

Quarter 

2016

1st 

Quarter 

2016

4th 

Quarter 

2015

3rd 

Quarter 

2015

2nd 

Quarter 

2015

1st 

Quarter 

2015

4th 

Quarter 

2014

3rd 

Quarter 

2014

2nd 

Quarter 

2014

1st 

Quarter 

2014

4th 

Quarter 

2013

3rd 

Quarter 

2013

2nd 

Quarter 

2013

Beginning Fund Balance $75,120 $72,600 $70,115 $67,589 $65,296 $62,780 $54,320 $51,059 $48,893 $47,191 $40,758 $37,871 $35,742

Changes in Fund Balance:

Assessments earned 2,328 2,328 2,160 2,170 2,328 2,189 2,030 2,009 2,224 2,393 2,224 2,339 2,526

Interest earned on 

investment securities 164 147 128 122 113 60 70 80 87 45 23 34 54

Realized gain on sale of

investments 0 0 0 0 0 0 0 0 0 0 302 156 0

Operating expenses 441 415 447 410 434 396 408 406 428 422 436 298 439

Provision for insurance 

losses -627 -43 -930 -578 -317 -426 -6,787 -1,663 -204 348 -4,588 -539 -33

All other income, 

net of expenses 2 5 12 2 3 6 -43 6 6 9 9 46 51

Unrealized gain/(loss) on 

available-for-sale 

securities 110 412 -298 64 -34 231 24 -91 73 25 -277 71 -96

Total fund balance change 2,790 2,520 2,485 2,526 2,293 2,516 8,460 3,261 2,166 1,702 6,433 2,887 2,129

Ending Fund Balance 77,910 75,120 72,600 70,115 67,589 65,296 62,780 54,320 51,059 48,893 47,191 40,758 37,871

Percent change from 

 four quarters earlier 15.27 15.05 15.64 29.08 32.37 33.55 33.03 33.27 34.82 36.79 43.19 61.58 66.88

Reserve Ratio (%) 1.17 1.13 1.11 1.09 1.07 1.03 1.01 0.89 0.84 0.80 0.79 0.68 0.64

Estimated Insured 

Deposits 6,683,668 6,670,040 6,531,014 6,418,195 6,345,199 6,345,210 6,205,775 6,136,985 6,105,327 6,115,296 6,004,747 5,968,649 5,951,721

Percent change from 

 four quarters earlier 5.33 5.12 5.24 4.58 3.93 3.76 3.35 2.82 2.58 1.95 -18.91 -17.66 -15.95

Domestic Deposits 11,240,142 11,154,730 10,950,091 10,695,508 10,629,336 10,616,459 10,408,189 10,213,201 10,099,416 9,962,545 9,825,480 9,631,665 9,424,637

Percent change from 

 four quarters earlier 5.75 5.07 5.21 4.72 5.25 6.56 5.93 6.04 7.16 5.37 3.70 6.02 5.45

Assessment Base** 14,225,850 14,025,656 13,859,582 13,687,885 13,620,454 13,545,758 13,360,130 13,127,469 12,921,318 12,809,815 12,757,552 12,538,835 12,502,839

Percent change from 

 four quarters earlier 4.44 3.54 3.74 4.27 5.41 5.75 4.72 4.69 3.35 2.97 2.59 2.14 2.82

Number of Institutions 

Reporting 6,067 6,131 6,191 6,279 6,357 6,428 6,518 6,598 6,665 6,739 6,821 6,900 6,949

Deposit Insurance Fund Balance 

and Insured Deposits

($ Millions)

DIF 

Balance

DIF-Insured 

Deposits

6/13 $37,871 $5,951,721

9/13 40,758 5,968,649

12/13 47,191 6,004,747

3/14 48,893 6,115,296

6/14 51,059 6,105,327

9/14 54,320 6,136,985

12/14 62,780 6,205,775

3/15 65,296 6,345,210

6/15 67,589 6,345,199

9/15 70,115 6,418,195

12/15 72,600 6,531,014

3/16 75,120 6,670,040

6/16 77,910 6,683,668

Table II-C. Problem Institutions and Failed Institutions

(dollar figures in millions) 2016*** 2015*** 2015 2014 2013 2012 2011

Problem Institutions

Number of institutions 147 228 183 291 467 651 813

Total assets $28,970 $56,503 $46,780 $86,712 $152,687 $232,701 $319,432

Failed Institutions

Number of institutions 3 5 8 18 24 51 92

Total assets**** $189 $6,389 $6,706 $2,914 $6,044 $11,617 $34,923

* Quarterly financial statement results are unaudited.

** Average consolidated total assets minus tangible equity, with adjustments for banker’s banks and custodial banks.

*** Through June 30.

**** Total assets are based on final Call Reports submitted by failed institutions.
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 27

Table III-C. Estimated FDIC-Insured Deposits by Type of Institution

(dollar figures in millions)

June 30, 2016

Number of 

Institutions

Total 

Assets

Domestic 

Deposits*

Est. Insured 

Deposits

Commercial Banks and Savings Institutions

FDIC-Insured Commercial Banks 5,238 $15,425,648 $10,333,441 $5,950,187

 FDIC-Supervised 3,482 2,371,820 1,866,511 1,316,850

 OCC-Supervised 962 10,540,082 6,759,972 3,720,192

 Federal Reserve-Supervised 794 2,513,746 1,706,958 913,146

FDIC-Insured Savings Institutions 820 1,108,343 867,753 706,300

 OCC-Supervised Savings Institutions 389 709,269 567,490 467,075

 FDIC-Supervised Savings Institutions 396 374,547 280,977 223,688

 Federal Reserve-Supervised 35 24,527 19,286 15,538

Total Commercial Banks and Savings Institutions 6,058 16,533,991 11,201,194 6,656,488

Other FDIC-Insured Institutions

U.S. Branches of Foreign Banks 9 99,397 38,948 27,180

Total FDIC-Insured Institutions 6,067 16,633,388 11,240,142 6,683,668

* Excludes $1.3 trillion in foreign office deposits, which are not FDIC insured.

Table IV-C. Distribution of Institutions and Assessment Base by Assessment Rate Range

Quarter Ending March 31, 2016 (dollar figures in billions)

Annual Rate in Basis Points

Number of 

Institutions

Percent of Total 

Institutions

Amount of 

Assessment Base*

Percent of Total 

Assessment Base

2.50-5.00 1,595 26.02 $1,811.9 12.92

5.01-7.50 3,069 50.06 9,858.1 70.29

7.51-10.00 952 15.53 1,914.6 13.65

10.01-15.00 330 5.38 344.4 2.46

15.01-20.00 13 0.21 12.8 0.09

 20.01-25.00 141 2.30 77.8 0.55

 25.01-30.00 0 0.00 0.0 0.00

 30.01-35.00 30 0.49 6.2 0.04

greater than 35.00 1 0.02 0.0 0.00

* Beginning in the second quarter of 2011, the assessment base was changed to average consolidated total assets minus tangible equity, as required by the Dodd-Frank Act.

QUARTERLY BANKING PROFILE

FDIC QUARTERLY 29

Notes to Users

This publication contains financial data and other information for 

depository institutions insured by the Federal Deposit Insurance 

Corporation (FDIC). These notes are an integral part of this publication and provide information regarding the comparability of source 

data and reporting differences over time.

Tables I-A through VIII-A.

The information presented in Tables I-A through V-A of the 

FDIC Quarterly Banking Profile is aggregated for all FDIC-insured 

institutions, both commercial banks and savings institutions. Tables 

VI-A (Derivatives) and VII-A (Servicing, Securitization, and Asset 

Sales Activities) aggregate information only for insured commercial banks and state-chartered savings banks that file quarterly Call 

Reports. Table VIII-A (Trust Services) aggregates Trust asset and 

income information collected annually from all FDIC-insured institutions. Some tables are arrayed by groups of FDIC-insured institutions 

based on predominant types of asset concentration, while other tables 

aggregate institutions by asset size and geographic region. Quarterly 

and full-year data are provided for selected indicators, including 

aggregate condition and income data, performance ratios, condition 

ratios, and structural changes, as well as past due, noncurrent, and 

charge-off information for loans outstanding and other assets.

Tables I-B through VI-B.

The information presented in Tables I-B through VI-B is aggregated 

for all FDIC-insured commercial banks and savings institutions 

meeting the criteria for community banks that were developed for 

the FDIC’s Community Banking Study, published in December, 2012: 

http://fdic.gov/regulations/resources/cbi/report/cbi-full.pdf.

The determination of which insured institutions are considered community banks is based on five steps.

The first step in defining a community bank is to aggregate all 

charter-level data reported under each holding company into 

a single banking organization. This aggregation applies both to 

balance-sheet measures and the number and location of banking 

offices. Under the FDIC definition, if the banking organization is 

designated as a community bank, every charter reporting under that 

organization is also considered a community bank when working 

with data at the charter level.

The second step is to exclude any banking organization where more 

than 50 percent of total assets are held in certain specialty banking 

charters, including: credit card specialists, consumer nonbank banks, 

industrial loan companies, trust companies, bankers’ banks, and banks 

holding 10 percent or more of total assets in foreign offices.

Once the specialty organizations are removed, the third step involves 

including organizations that engage in basic banking activities as 

measured by the total loans-to-assets ratio (greater than 33 percent) 

and the ratio of core deposits to assets (greater than 50 percent). Core 

deposits are defined as non-brokered deposits in domestic offices. 

Analysis of the underlying data shows that these thresholds establish 

meaningful levels of basic lending and deposit gathering and still 

allow for a degree of diversity in how individual banks construct their 

balance sheets.

The fourth step includes organizations that operate within a limited 

geographic scope. This limitation of scope is used as a proxy measure 

for a bank’s relationship approach to banking. Banks that operate 

within a limited market area have more ease in managing relationships at a personal level. Under this step, four criteria are applied to 

each banking organization. They include both a minimum and maximum number of total banking offices, a maximum level of deposits 

for any one office, and location-based criteria. The limits on the 

number of and deposits per office are gradually adjusted upward over 

time. For banking offices, banks must have more than one office, and 

the maximum number of offices starts at 40 in 1985 and reaches 75 in 

2010. The maximum level of deposits for any one office is $1.25 billion in deposits in 1985 and $5 billion in deposits in 2010. The 

remaining geographic limitations are also based on maximums for 

the number of states (fixed at 3) and large metropolitan areas (fixed 

at 2) in which the organization maintains offices. Branch office data 

are based on the most recent data from the annual June 30 Summary 

of Deposits Survey that are available at the time of publication.

Finally, the definition establishes an asset-size limit, also adjusted 

upward over time from $250 million in 1985 to $1 billion in 2010, 

below which the limits on banking activities and geographic scope are 

waived. This final step acknowledges the fact that most of those small 

banks that are not excluded as specialty banks meet the requirements 

for banking activities and geographic limits in any event.

Summary of FDIC Research Definition of Community 

Banking Organizations

Community banks are designated at the level of the banking 

organization.

(All charters under designated holding companies are considered 

community banking charters.)

Exclude: Any organization with:

— No loans or no core deposits

— Foreign Assets ≥ 10% of total assets

— More than 50% of assets in certain specialty banks, including:

• credit card specialists

• consumer nonbank banks1

• industrial loan companies

• trust companies

• bankers’ banks

Include: All remaining banking organizations with:

— Total assets < indexed size threshold 

2

— Total assets ≥ indexed size threshold, where:

• Loan to assets > 33%

• Core deposits to assets > 50%

• More than 1 office but no more than the indexed maximum 

number of offices.3

• Number of large MSAs with offices ≤ 2

• Number of states with offices ≤ 3

• No single office with deposits > indexed maximum branch 

deposit size.4

1 Consumer nonbank banks are financial institutions with limited charters that can 

make commercial loans or take deposits, but not both.

2 Asset size threshold indexed to equal $250 million in 1985 and $1 billion in 2010.

3 Maximum number of offices indexed to equal 40 in 1985 and 75 in 2010.

4 Maximum branch deposit size indexed to equal $1.25 billion in 1985 and $5 billion 

in 2010.
2 0 1 6  •Volume 1 0  • Number 3

30 FDIC QUARTERLY

Tables I-C through IV-C.

A separate set of tables (Tables I-C through IV-C) provides comparative quarterly data related to the Deposit Insurance Fund (DIF), problem institutions, failed/assisted institutions, estimated FDIC-insured 

deposits, as well as assessment rate information. Depository institutions that are not insured by the FDIC through the DIF are not included in the FDIC Quarterly Banking Profile. U.S. branches of institutions 

headquartered in foreign countries and non-deposit trust companies 

are not included unless otherwise indicated. Efforts are made to obtain 

financial reports for all active institutions. However, in some cases, 

final financial reports are not available for institutions that have closed 

or converted their charters.

DATA SOURCES

The financial information appearing in this publication is obtained 

primarily from the Federal Financial Institutions Examination 

Council (FFIEC) Consolidated Reports of Condition and Income 

(Call Reports) and the OTS Thrift Financial Reports submitted by 

all FDIC-insured depository institutions. (TFR filers began filing 

Call Reports effective with the quarter ending March 31, 2012.) This 

information is stored on and retrieved from the FDIC’s Research 

Information System (RIS) database.

COMPUTATION METHODOLOGY

Parent institutions are required to file consolidated reports, while 

their subsidiary financial institutions are still required to file separate reports. Data from subsidiary institution reports are included 

in the Quarterly Banking Profile tables, which can lead to doublecounting. No adjustments are made for any double-counting of subsidiary data. Additionally, certain adjustments are made to the OTS 

Thrift Financial Reports to provide closer conformance with the 

reporting and accounting requirements of the FFIEC Call Reports.

(TFR filers began filing Call Reports effective with the quarter 

ending March 31, 2012.)

All condition and performance ratios represent weighted averages, 

i.e., the sum of the individual numerator values divided by the sum 

of individual denominator values. All asset and liability figures used 

in calculating performance ratios represent average amounts for the 

period (beginning-of-period amount plus end-of-period amount plus 

any interim periods, divided by the total number of periods). For 

“pooling-of-interest” mergers, the assets of the acquired institution(s) 

are included in average assets since the year-to-date income includes 

the results of all merged institutions. No adjustments are made for 

“purchase accounting” mergers. Growth rates represent the percentage change over a 12-month period in totals for institutions in the 

base period to totals for institutions in the current period. For the 

community bank subgroup, growth rates will reflect changes over 

time in the number and identities of institutions designated as community banks, as well as changes in the assets and liabilities, and 

income and expenses of group members. Unless indicated otherwise, 

growth rates are not adjusted for mergers or other changes in the 

composition of the community bank subgroup.

All data are collected and presented based on the location of each 

reporting institution’s main office. Reported data may include assets 

and liabilities located outside of the reporting institution’s home 

state. In addition, institutions may relocate across state lines or 

change their charters, resulting in an inter-regional or inter-industry 

migration, e.g., institutions can move their home offices between 

regions, and savings institutions can convert to commercial banks or 

commercial banks may convert to savings institutions.

ACCOUNTING CHANGES

Accounting for Measurement-Period Adjustments Related to a 

Business Combination 

In September 2015, the Financial Accounting Standards Board 

(FASB) issued Accounting Standards Update (ASU) No. 2015-16, 

“Simplifying the Accounting for Measurement-Period Adjustments.” 

Under Accounting Standards Codification Topic 805, Business 

Combinations (formerly FASB Statement No. 141(R), “Business 

Combinations”), if the initial accounting for a business combination 

is incomplete by the end of the reporting period in which the combination occurs, the acquirer reports provisional amounts in its financial statements for the items for which the accounting is incomplete. 

During the measurement period, the acquirer is required to adjust the 

provisional amounts recognized at the acquisition date, with a corresponding adjustment to goodwill, to reflect new information obtained 

about facts and circumstances that existed as of the acquisition date 

that, if known, would have affected the measurement of the amounts 

recognized as of that date. At present under Topic 805, an acquirer is 

required to retrospectively adjust the provisional amounts recognized 

at the acquisition date to reflect the new information. To simplify the 

accounting for the adjustments made to provisional amounts, ASU 

2015-16 eliminates the requirement to retrospectively account for the 

adjustments. Accordingly, the ASU amends Topic 805 to require an 

acquirer to recognize adjustments to provisional amounts that are 

identified during the measurement period in the reporting period 

in which adjustment amounts are determined. Under the ASU, the 

acquirer also must recognize in the financial statements for the same 

reporting period the effect on earnings, if any, resulting from the 

adjustments to the provisional amounts as if the accounting for the 

business combination had been completed as of the acquisition date. 

In general, the measurement period in a business combination is 

the period after the acquisition date during which the acquirer may 

adjust provisional amounts reported for identifiable assets acquired, 

liabilities assumed, and consideration transferred for the acquiree for 

which the initial accounting for the business combination is incomplete at the end of the reporting period in which the combination 

occurs. Topic 805 provides additional guidance on the measurement 

period, which shall not exceed one year from the acquisition date, 

and adjustments to provisional amounts during this period. 

For institutions that are public business entities, as defined under U.S. 

GAAP, ASU 2015-16 is effective for fiscal years, and interim periods 

within those fiscal years, beginning after December 15, 2015. For 

institutions that are not public business entities (i.e., that are private 

companies), the ASU is effective for fiscal years beginning after 

December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. The ASU’s amendments to Topic 805 

should be applied prospectively to adjustments to provisional 

amounts that occur after the effective date of the ASU. Thus, institutions with a calendar year fiscal year that are public business entities 

must apply the ASU to any adjustments to provisional amounts that 

occur after January 1, 2016, beginning with their Call Reports for 

March 31, 2016. Institutions with a calendar year fiscal year that are 

private companies must apply the ASU to any adjustments to provisional amounts that occur after January 1, 2017, beginning with their 

Call Reports for December 31, 2017. Early application of ASU 2015-

16 is permitted in Call Reports that have not been submitted. 

For additional information, institutions should refer to ASU 

2015-16, which is available at http://www.fasb.org/jsp/FASB/Page/

SectionPage&cid=1176156316498.
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 31

Debt Issuance Costs 

In April 2015, the FASB issued ASU No. 2015-03, “Simplifying the 

Presentation of Debt Issuance Costs.” This ASU requires debt issuance costs associated with a recognized debt liability to be presented 

as a direct deduction from the face amount of the related debt liability, similar to debt discounts. The ASU is limited to the presentation 

of debt issuance costs; therefore, the recognition and measurement guidance for such costs is unaffected. At present, Accounting 

Standards Codification (ASC) Subtopic 835-30, Interest—Imputation 

of Interest, requires debt issuance costs to be reported on the balance 

sheet as an asset (i.e., a deferred charge). For Call Report purposes, 

the costs of issuing debt currently are reported, net of accumulated 

amortization, in “Other assets.”

For institutions that are public business entities, as defined under U.S. 

GAAP, ASU 2015-03 is effective for fiscal years, and interim periods 

within those fiscal years, beginning after December 15, 2015. For 

example, institutions with a calendar year fiscal year that are public 

business entities must apply the ASU in their Call Reports beginning 

March 31, 2016. For institutions that are not public business entities 

(i.e., that are private companies), the ASU is effective for fiscal years 

beginning after December 15, 2015, and interim periods within fiscal years beginning after December 15, 2016. Thus, institutions with 

a calendar year fiscal year that are private companies must apply 

the ASU in their December 31, 2016, and subsequent quarterly Call 

Reports. Early adoption of the guidance in ASU 2015-03 is permitted.

Extraordinary Items

In January 2015, the FASB issued ASU No. 2015-01, “Simplifying 

Income Statement Presentation by Eliminating the Concept of 

Extraordinary Items.” This ASU eliminates from U.S. GAAP the 

concept of extraordinary items. At present, ASC Subtopic 225-20, 

Income Statement—Extraordinary and Unusual Items (formerly 

Accounting Principles Board Opinion No. 30, “Reporting the Results 

of Operations”), requires an entity to separately classify, present, and 

disclose extraordinary events and transactions. An event or transaction is presumed to be an ordinary and usual activity of the reporting 

entity unless evidence clearly supports its classification as an extraordinary item. If an event or transaction currently meets the criteria for 

extraordinary classification, an institution must segregate the extraordinary item from the results of its ordinary operations and report the 

extraordinary item in its income statement as “Extraordinary items 

and other adjustments, net of income taxes.” 

ASU 2015-01 is effective for fiscal years, and interim periods within 

those fiscal years, beginning after December 15, 2015. Thus, for 

example, institutions with a calendar year fiscal year must begin 

to apply the ASU in their Call Reports for March 31, 2016. Early 

adoption of ASU 2015-01 is permitted provided that the guidance 

is applied from the beginning of the fiscal year of adoption. For Call 

Report purposes, an institution with a calendar year fiscal year must 

apply the ASU prospectively, that is, in general, to events or transactions occurring after the date of adoption. However, an institution 

with a fiscal year other than a calendar year may elect to apply ASU 

2015-01 prospectively or, alternatively, it may elect to apply the ASU 

retrospectively to all prior calendar quarters included in the institution’s year-to-date Call Report income statement that includes the 

beginning of the fiscal year of adoption. 

After an institution adopts ASU 2015-01, any event or transaction 

that would have met the criteria for extraordinary classification 

before the adoption of the ASU should be reported in “Other noninterest income,” or “Other noninterest expense,” as appropriate, unless 

the event or transaction would otherwise be reportable in the income 

statement. In addition, consistent with ASU 2015-01, the agencies 

plan to remove reference to the term “extraordinary items” from the 

Call Report income statement.

For additional information, institutions should refer to ASU 

2015-01, which is available at http://www.fasb.org/jsp/FASB/Page/

SectionPage&cid=1176156316498. 

Accounting by Private Companies for Identifiable Intangible Assets 

in a Business Combination

In December 2014, the FASB issued ASU No. 2014-18, “Accounting 

for Identifiable Intangible Assets in a Business Combination,” which 

is a consensus of the Private Company Council (PCC). This ASU 

provides an accounting alternative that permits a private company, 

as defined in U.S. GAAP (and discussed in a later section of these 

Supplemental Instructions), to simplify the accounting for certain 

intangible assets. The accounting alternative applies when a private 

company is required to recognize or otherwise consider the fair value 

of intangible assets as a result of certain transactions, including when 

applying the acquisition method to a business combination under 

ASC Topic 805, Business Combinations (formerly FASB Statement 

No. 141 (revised 2007), “Business Combinations”).

Under ASU 2014-18, a private company that elects the accounting 

alternative should no longer recognize separately from goodwill:

•Customer-related intangible assets unless they are capable of bein

sold or licensed independently from the other assets of a business, 

and

• Noncompetition agreements.

However, because mortgage servicing rights and core deposit intangibles are regarded as capable of being sold or licensed independently, 

a private company that elects this accounting alternative must recognize these intangible assets separately from goodwill, initially measure 

them at fair value, and subsequently measure them in accordance 

with ASC Topic 350, Intangibles–Goodwill and Other (formerly 

FASB Statement No. 142, “Goodwill and Other Intangible Assets”).

A private company that elects the accounting alternative in 

ASU 2014-18 also must adopt the private company goodwill accounting alternative described in ASU 2014-02, “Accounting for Goodwill.” 

However, a private company that elects the goodwill accounting 

alternative in ASU 2014-02 is not required to adopt the accounting 

alternative for identifiable intangible assets in ASU 2014-18.

A private company’s decision to adopt ASU 2014-18 must be made 

upon the occurrence of the first business combination (or other 

transaction within the scope of the ASU) in fiscal years beginning 

after December 15, 2015. The effective date of the private company’s 

decision to adopt the accounting alternative for identifiable intangible 

assets depends on the timing of that first transaction.

If the first transaction occurs in the private company’s first fiscal year 

beginning after December 15, 2015, the adoption will be effective for 

that fiscal year’s annual financial reporting period and all interim and 

annual periods thereafter. If the first transaction occurs in a fiscal 

year beginning after December 15, 2016, the adoption will be effective in the interim period that includes the date of the transaction and 

subsequent interim and annual periods thereafter.

Early application of the intangibles accounting alternative is permitted for any annual or interim period for which a private company’s 

financial statements have not yet been made available for issuance. 

Customer-related intangible assets and noncompetition agreements 

that exist as of the beginning of the period of adoption should continue to be accounted for separately from goodwill, i.e., such existing 

intangible assets should not be combined with goodwill.
2 0 1 6  •Volume 1 0  • Number 3

32 FDIC QUARTERLY

A bank or savings association that meets the private company definition in U.S. GAAP is permitted, but not required, to adopt ASU 2014-

18 for Call Report purposes and may choose to early adopt the ASU, 

provided it also adopts the private company goodwill accounting 

alternative. If a private institution issues U.S. GAAP financial statements and adopts ASU 2014-18, it should apply the ASU’s intangible 

asset accounting alternative in its Call Report in a manner consistent 

with its reporting of intangible assets in its financial statements.

For additional information on the private company accounting alternative for identifiable intangible assets, institutions should refer to 

ASU 2014-18, which is available at http://www.fasb.org/jsp/FASB/

Page/SectionPage&cid=1176156316498.

Private Company Accounting Alternatives 

In May 2012, the Financial Accounting Foundation, the independent 

private sector organization responsible for the oversight of the FASB, 

approved the establishment of the PCC to improve the process of setting accounting standards for private companies. The PCC is charged 

with working jointly with the FASB to determine whether and in 

what circumstances to provide alternative recognition, measurement, 

disclosure, display, effective date, and transition guidance for private 

companies reporting under U.S. GAAP. Alternative guidance for private companies may include modifications or exceptions to otherwise 

applicable existing U.S. GAAP standards. 

The banking agencies have concluded that a bank or savings association that is a private company, as defined in U.S. GAAP (as discussed 

in a later section of these Supplemental Instructions), is permitted 

to use private company accounting alternatives issued by the FASB 

when preparing its Call Reports, except as provided in 12 U.S.C. 

1831n(a) as described in the following sentence. If the agencies 

determine that a particular accounting principle within U.S. GAAP, 

including a private company accounting alternative, is inconsistent 

with the statutorily specified supervisory objectives, the agencies may 

prescribe an accounting principle for regulatory reporting purposes 

that is no less stringent than U.S. GAAP. In such a situation, an institution would not be permitted to use that particular private company 

accounting alternative or other accounting principle within U.S. 

GAAP for Call Report purposes. The agencies would provide appropriate notice if they were to disallow any accounting alternative under 

the statutory process.

Accounting by Private Companies for Goodwill 

On January 16, 2014, the FASB issued ASU No. 2014-02, 

“Accounting for Goodwill,” which is a consensus of the PCC. This 

ASU generally permits a private company to elect to amortize goodwill on a straight-line basis over a period of ten years (or less than ten 

years if more appropriate) and apply a simplified impairment model 

to goodwill. In addition, if a private company chooses to adopt the 

ASU’s goodwill accounting alternative, the ASU requires the private 

company to make an accounting policy election to test goodwill 

for impairment at either the entity level or the reporting unit level. 

Goodwill must be tested for impairment when a triggering event 

occurs that indicates that the fair value of an entity (or a reporting 

unit) may be below its carrying amount. In contrast, U.S. GAAP does 

not otherwise permit goodwill to be amortized, instead requiring 

goodwill to be tested for impairment at the reporting unit level annually and between annual tests in certain circumstances. The ASU’s 

goodwill accounting alternative, if elected by a private company, is 

effective prospectively for new goodwill recognized in annual periods 

beginning after December 15, 2014, and in interim periods within 

annual periods beginning after December 15, 2015. Goodwill existing as of the beginning of the period of adoption is to be amortized 

prospectively over ten years (or less than ten years if more appropriate). The ASU states that early application of the goodwill accounting 

alternative is permitted for any annual or interim period for which a 

private company’s financial statements have not yet been made available for issuance. 

A bank or savings association that meets the private company definition in ASU 2014-02, as discussed in the following section of these 

Supplemental Instructions (i.e., a private institution), is permitted, 

but not required, to adopt this ASU for Call Report purposes and 

may choose to early adopt the ASU. If a private institution issues U.S. 

GAAP financial statements and adopts the ASU, it should apply the 

ASU’s goodwill accounting alternative in its Call Report in a manner 

consistent with its reporting of goodwill in its financial statements. 

Thus, for example, a private institution with a calendar year fiscal year that chooses to adopt ASU 2014-02 must apply the ASU’s 

provisions in its December 31, 2015, and subsequent quarterly Call 

Reports unless early application of the ASU was elected. This would 

require the private institution to report in its December 31, 2015, Call 

Report one year’s amortization of goodwill existing as of January 1, 

2015, and the amortization of any new goodwill recognized in 2015. 

For additional information on the private company accounting 

alternative for goodwill, institutions should refer to ASU 2014-

02, which is available at http://www.fasb.org/jsp/FASB/Page/

SectionPage&cid=1176156316498. 

Definitions of Private Company and Public Business Entity

According to ASU No. 2014-02, “Accounting for Goodwill,” a private 

company is a business entity that is not a public business entity. ASU 

No. 2013-12, “Definition of a Public Business Entity,” which was 

issued in December 2013, added this term to the Master Glossary 

in the Accounting Standards Codification. This ASU states that a 

business entity, such as a bank or savings association, that meets any 

one of five criteria set forth in the ASU is a public business entity for 

reporting purposes under U.S. GAAP, including for Call Report purposes. An institution that is a public business entity is not permitted 

to apply the private company goodwill accounting alternative discussed in the preceding section when preparing its Call Report.

For additional information on the definition of a public business 

entity, institutions should refer to ASU 2013-12, which is available at 

http://www.fasb.org/jsp/FASB/Page/SectionPage&cid=

1176156316498.

Reporting Certain Government-Guaranteed Mortgage Loans 

Upon Foreclosure 

In August 2014, the FASB issued Accounting Standards Update 

(ASU) No. 2014-14, “Classification of Certain GovernmentGuaranteed Mortgage Loans Upon Foreclosure,” to address diversity 

in practice for how government-guaranteed mortgage loans are 

recorded upon foreclosure. The ASU updates guidance contained in 

ASC Subtopic 310-40, Receivables—Troubled Debt Restructurings by 

Creditors (formerly FASB Statement No. 15, “Accounting by Debtors 

and Creditors for Troubled Debt Restructurings,” as amended), 

because U.S. GAAP previously did not provide specific guidance on 

how to categorize or measure foreclosed mortgage loans that are government guaranteed. The ASU clarifies the conditions under which a 

creditor must derecognize a government-guaranteed mortgage loan 

and recognize a separate “other receivable” upon foreclosure (that is, 

when a creditor receives physical possession of real estate property 

collateralizing a mortgage loan in accordance with the guidance in 

ASC Subtopic 310-40). 
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 33

Under the ASU, institutions should derecognize a mortgage loan and 

record a separate other receivable upon foreclosure of the real estate 

collateral if the following conditions are met: 

•The loan has a government guarantee that is not separable from th

loan before foreclosure. 

•At the time of foreclosure, the institution has the intent to conve

the property to the guarantor and make a claim on the guarantee 

and it has the ability to recover under that claim. 

•At the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed (tha

is, the real estate property has been appraised for purposes of the 

claim and thus the institution is not exposed to changes in the fair 

value of the property). 

This guidance is applicable to fully and partially governmentguaranteed mortgage loans provided the three conditions identified 

above have been met. In such situations, upon foreclosure, the separate other receivable should be measured based on the amount of the 

loan balance (principal and interest) expected to be recovered from 

the guarantor. 

For institutions that are public business entities, as defined under 

U.S. GAAP (as discussed in an earlier section of these Supplemental 

Instructions), ASU 2014-14 is effective for fiscal years, and interim 

periods within those fiscal years, beginning after December 15, 2014. 

For example, institutions with a calendar year fiscal year that are 

public business entities must apply the ASU in their Call Reports 

beginning March 31, 2015. However, institutions that are not public 

business entities (i.e., that are private companies) are not required 

to apply the guidance in ASU 2014-14 until annual periods ending after December 15, 2015, and interim periods beginning after 

December 15, 2015. Thus, institutions with a calendar year fiscal year 

that are private companies must apply the ASU in their December 31, 

2015, and subsequent quarterly Call Reports. Earlier adoption of the 

guidance in ASU 2014-14 is permitted if the institution has already 

adopted the amendments in ASU No. 2014-04, “Reclassification of 

Residential Real Estate Collateralized Consumer Mortgage Loans 

upon Foreclosure.” 

For additional information, institutions should refer to ASU 

2014-14, which is available at http://www.fasb.org/jsp/FASB/Page/

SectionPage&cid=1176156316498. 

Reclassification of Residential Real Estate Collateralized 

Consumer Mortgage Loans Upon Foreclosure

In January 2014, the FASB issued Accounting Standards Update 

(ASU) No. 2014-04, “Reclassification of Residential Real Estate 

Collateralized Consumer Mortgage Loans upon Foreclosure,” to 

address diversity in practice for when certain loan receivables should 

be derecognized and the real estate collateral recognized. The ASU 

updated guidance contained in Accounting Standards Codification 

Subtopic 310-40, Receivables–Troubled Debt Restructurings by 

Creditors (formerly FASB Statement No.15, “Accounting by Debtors 

and Creditors for Troubled Debt Restructurings,” as amended).

Under prior accounting guidance, all loan receivables were reclassified to other real estate owned (OREO) when the institution, as 

creditor, obtained physical possession of the property, regardless of 

whether formal foreclosure proceedings had taken place. The new 

ASU clarifies when a creditor is considered to have received physical 

possession (resulting from an in-substance repossession or foreclosure) of residential real estate collateralizing a consumer mortgage 

loan. Under the new guidance, physical possession for these residential real estate properties is considered to have occurred and a loan 

receivable would be reclassified to OREO only upon:

•The institution obtaining legal title upon completion of a fo

closure even if the borrower has redemption rights that provide the 

borrower with a legal right for a period of time after foreclosure to 

reclaim the property by paying certain amounts specified by law, or

•The completion of a deed in lieu of foreclosure or similar lega

agreement under which the borrower conveys all interest in the 

residential real estate property to the institution to satisfy the loan.

Loans secured by real estate other than consumer mortgage loans collateralized by residential real estate should continue to be reclassified 

to OREO when the institution has received physical possession of a 

borrower’s real estate, regardless of whether formal foreclosure proceedings take place.

For institutions that are public business entities, as defined under U.S. 

generally accepted accounting principles, ASU 2014-04 is effective for 

fiscal years, and interim periods within those fiscal years, beginning 

after December 15, 2014. For example, institutions with a calendar 

year fiscal year that are public business entities must apply the ASU 

in their Call Reports beginning March 31, 2015. However, institutions that are not public business entities are not required to apply 

the guidance in ASU 2014-04 until annual periods beginning after 

December 15, 2014, and interim periods within annual periods beginning after December 15, 2015. Thus, institutions with a calendar year 

fiscal year that are not public business entities must apply the ASU 

in their December 31, 2015, and subsequent quarterly Call Reports. 

Earlier adoption of the guidance in ASU 2014-04 is permitted. 

Entities can elect to apply the ASU on either a modified retrospective 

transition basis or a prospective transition basis. Applying the ASU on 

a prospective transition basis should be less complex for institutions 

than applying the ASU on a modified retrospective transition basis. 

Under the prospective transition method, an institution should apply 

the new guidance to all instances where it receives physical possession 

of residential real estate property collateralizing consumer mortgage 

loans that occur after the date of adoption of the ASU. Under the 

modified retrospective transition method, an institution should apply 

a cumulative-effect adjustment to residential consumer mortgage 

loans and OREO existing as of the beginning of the annual period 

for which the ASU is effective. As a result of adopting the ASU on a 

modified retrospective basis, assets reclassified from OREO to loans 

should be measured at the carrying value of the real estate at the date 

of adoption while assets reclassified from loans to OREO should be 

measured at the lower of the net amount of the loan receivable or the 

OREO property’s fair value less costs to sell at the time of adoption.

For additional information, institutions should refer to ASU 2014-04, 

which is available at http://www.fasb.org/jsp/FASB/Page/SectionPage

&cid=1176156316498.

True-Up Liability Under an FDIC Loss-Sharing Agreement

An insured depository institution that acquires a failed insured institution may enter into a loss-sharing agreement with the FDIC under 

which the FDIC agrees to absorb a portion of the losses on a specified 

pool of the failed institution’s assets during a specified time period. 

The acquiring institution typically records an indemnification asset 

representing its right to receive payments from the FDIC for losses 

during the specified time period on assets covered under the losssharing agreement.

Since 2009, most loss-sharing agreements have included a true-up 

provision that may require the acquiring institution to reimburse the 

FDIC if cumulative losses in the acquired loss-share portfolio are less 
2 0 1 6  •Volume 1 0  • Number 3

34 FDIC QUARTERLY

than the amount of losses claimed by the institution throughout the 

loss-sharing period. Typically, a true-up liability may result because 

the recovery period on the loss-share assets (e.g., eight years) is 

longer than the period during which the FDIC agrees to reimburse 

the acquiring institution for losses on the loss-share portfolio (e.g., 

five years).

Consistent with U.S. GAAP and bank guidance for “Offsetting,” 

institutions are permitted to offset assets and liabilities recognized 

in the Report of Condition when a “right of setoff” exists. Under 

ASC Subtopic 210-20, Balance Sheet—Offsetting (formerly FASB 

Interpretation No. 39, “Offsetting of Amounts Related to Certain 

Contracts”), in general, a right of setoff exists when a reporting 

institution and another party each owes the other determinable 

amounts, the reporting institution has the right to set off the amounts 

each party owes and also intends to set off, and the right of setoff is 

enforceable at law. Because the conditions for the existence of a right 

of offset in ASC Subtopic 210-20 normally would not be met with 

respect to an indemnification asset and a true-up liability under a losssharing agreement with the FDIC, this asset and liability should not be 

netted for Call Report purposes. Therefore, institutions should report 

the indemnification asset gross (i.e., without regard to any true-up 

liability) in Other Assets, and any true-up liability in Other Liabilities.

In addition, an institution should not continue to report assets 

covered by loss-sharing agreements after the expiration of the losssharing period even if the terms of the loss-sharing agreement require 

reimbursements from the institution to the FDIC for certain amounts 

during the recovery period.

Indemnification Assets and Accounting Standards Update 

No. 2012-06 – In October 2012, the FASB issued Accounting 

Standards Update (ASU) No. 2012-06, “Subsequent Accounting 

for an Indemnification Asset Recognized at the Acquisition Date 

as a Result of a Government-Assisted Acquisition of a Financial 

Institution,” to address the subsequent measurement of an indemnification asset recognized in an acquisition of a financial institution that 

includes an FDIC loss-sharing agreement. This ASU amends ASC 

Topic 805, Business Combinations (formerly FASB Statement No. 141 

(revised 2007), “Business Combinations”), which includes guidance 

applicable to FDIC-assisted acquisitions of failed institutions.

Under the ASU, when an institution experiences a change in the 

cash flows expected to be collected on an FDIC loss-sharing indemnification asset because of a change in the cash flows expected to be 

collected on the assets covered by the loss-sharing agreement, the 

institution should account for the change in the measurement of the 

indemnification asset on the same basis as the change in the assets 

subject to indemnification. Any amortization of changes in the value 

of the indemnification asset should be limited to the lesser of the 

term of the indemnification agreement and the remaining life of the 

indemnified assets.

The ASU is effective for fiscal years, and interim periods within those 

fiscal years, beginning on or after December 15, 2012. For institutions with a calendar year fiscal year, the ASU takes effect January 1, 

2013. Early adoption of the ASU is permitted. The ASU’s provisions 

should be applied prospectively to any new indemnification assets 

acquired after the date of adoption and to indemnification assets 

existing as of the date of adoption arising from an FDIC-assisted 

acquisition of a financial institution. Institutions with indemnification assets arising from FDIC loss-sharing agreements are expected 

to adopt ASU 2012-06 for Call Report purposes in accordance with 

the effective date of this standard. For additional information, refer 

to ASU 2012-06, available at http://www.fasb.org/jsp/FASB/Page/

SectionPage&cid=1176156316498.

Goodwill Impairment Testing – In September 2011, the FASB issued 

Accounting Standards Update (ASU) No. 2011-08, “Testing Goodwill 

for Impairment,” to address concerns about the cost and complexity of the existing goodwill impairment test in ASC Topic 350, 

Intangibles-Goodwill and Other (formerly FASB Statement No. 142, 

“Goodwill and Other Intangible Assets”). The ASU’s amendments to 

ASC Topic 350 are effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 

2011 (i.e., for annual or interim tests performed on or after January 1, 

2012, for institutions with a calendar year fiscal year). Early adoption 

of the ASU was permitted. Under ASU 2011-08, an institution has 

the option of first assessing qualitative factors to determine whether 

it is necessary to perform the two-step quantitative goodwill impairment test described in ASC Topic 350. If, after considering all relevant events and circumstances, an institution determines it is unlikely 

(that is, a likelihood of 50 percent or less) that the fair value of a 

reporting unit is less than its carrying amount (including goodwill), 

then the institution does not need to perform the two-step goodwill 

impairment test. If the institution instead concludes that the opposite 

is true (that is, it is likely that the fair value of a reporting unit is less 

than its carrying amount), then it is required to perform the first step 

and, if necessary, the second step of the two-step goodwill impairment test. Under ASU 2011-08, an institution may choose to bypass 

the qualitative assessment for any reporting unit in any period and 

proceed directly to performing the first step of the two-step goodwill 

impairment test.

Accounting for Loan Participations – Amended ASC Topic 860 

(formerly FAS 166) modified the criteria that must be met in order 

for a transfer of a portion of a financial asset, such as a loan participation, to qualify for sale accounting—refer to previously published 

Quarterly Banking Profile notes: http://www5.fdic.gov/qbp/2011mar/

qbpnot.html.

Other-Than-Temporary Impairment – When the fair value of an 

investment in an individual available-for-sale or held-to-maturity 

security is less than its cost basis, the impairment is either temporary 

or other-than-temporary. The amount of the total other-than-temporary impairment related to credit loss must be recognized in earnings, 

but the amount of total impairment related to other factors must be 

recognized in other comprehensive income, net of applicable taxes. 

To determine whether the impairment is other-than-temporary, an 

institution must apply the applicable accounting guidance—refer to 

previously published Quarterly Banking Profile notes: http://www5.

fdic.gov/qbp/2011mar/qbpnot.html.

Accounting Standards Codification – refer to previously published 

Quarterly Banking Profile notes: http://www5.fdic.gov/qbp/2011sep/

qbpnot.html. 

DEFINITIONS (in alphabetical order)

All other assets – total cash, balances due from depository institutions, premises, fixed assets, direct investments in real estate, 

investment in unconsolidated subsidiaries, customers’ liability on 

acceptances outstanding, assets held in trading accounts, federal 

funds sold, securities purchased with agreements to resell, fair market value of derivatives, prepaid deposit insurance assessments, and 

other assets.

All other liabilities – bank’s liability on acceptances, limited-life preferred stock, allowance for estimated off-balance-sheet credit losses, 

fair market value of derivatives, and other liabilities.

Assessment base – effective April 1, 2011, the deposit insurance 

assessment base has changed to “average consolidated total assets 

minus average tangible equity” with an additional adjustment to the 
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 35

assessment base for banker’s banks and custodial banks, as permitted 

under Dodd-Frank. Previously the assessment base was “assessable 

deposits” and consisted of DIF deposits (deposits insured by the 

FDIC Deposit Insurance Fund) in banks’ domestic offices with certain adjustments.

Assets securitized and sold – total outstanding principal balance 

of assets securitized and sold with servicing retained or other sellerprovided credit enhancements.

Capital Purchase Program (CPP) – as announced in October 2008 

under the TARP, the Treasury Department purchase of noncumulative perpetual preferred stock and related warrants that is treated as 

Tier 1 capital for regulatory capital purposes is included in “Total 

equity capital.” Such warrants to purchase common stock or noncumulative preferred stock issued by publicly-traded banks are 

reflected as well in “Surplus.” Warrants to purchase common stock or 

noncumulative preferred stock of not-publicly-traded bank stock are 

classified in a bank’s balance sheet as “Other liabilities.”

Common equity tier 1 capital ratio – ratio of common equity tier 1 

capital to risk-weighted assets. Common equity tier 1 capital includes 

common stock instruments and related surplus, retained earnings, 

accumulated other comprehensive income (AOCI), and limited 

amounts of common equity tier 1 minority interest, minus applicable 

regulatory adjustments and deductions. Items that are fully deducted 

from common equity tier 1 capital include goodwill, other intangible 

assets (excluding mortgage servicing assets) and certain deferred tax 

assets; items that are subject to limits in common equity tier 1 capital 

include mortgage servicing assets, eligible deferred tax assets, and certain significant investments.

Construction and development loans – includes loans for all 

property types under construction, as well as loans for land acquisition and development.

Core capital – common equity capital plus noncumulative perpetual 

preferred stock plus minority interest in consolidated subsidiaries, 

less goodwill and other ineligible intangible assets. The amount of 

eligible intangibles (including servicing rights) included in core capital is limited in accordance with supervisory capital regulations.

Cost of funding earning assets – total interest expense paid on 

deposits and other borrowed money as a percentage of average earning assets.

Credit enhancements – techniques whereby a company attempts to 

reduce the credit risk of its obligations. Credit enhancement may be 

provided by a third party (external credit enhancement) or by the 

originator (internal credit enhancement), and more than one type of 

enhancement may be associated with a given issuance.

Deposit Insurance Fund (DIF) – the Bank (BIF) and Savings 

Association (SAIF) Insurance Funds were merged in 2006 by the 

Federal Deposit Insurance Reform Act to form the DIF.

Derivatives notional amount – the notional, or contractual, amounts 

of derivatives represent the level of involvement in the types of 

derivatives transactions and are not a quantification of market risk or 

credit risk. Notional amounts represent the amounts used to calculate 

contractual cash flows to be exchanged.

Derivatives credit equivalent amount – the fair value of the derivative 

plus an additional amount for potential future credit exposure based on 

the notional amount, the remaining maturity and type of the contract.

Derivatives transaction types:

Futures and forward contracts – contracts in which the buyer 

agrees to purchase and the seller agrees to sell, at a specified 

future date, a specific quantity of an underlying variable or index 

at a specified price or yield. These contracts exist for a variety of 

variables or indices, (traditional agricultural or physical commodities, as well as currencies and interest rates). Futures contracts are 

standardized and are traded on organized exchanges which set 

limits on counterparty credit exposure. Forward contracts do not 

have standardized terms and are traded over the counter.

Option contracts – contracts in which the buyer acquires the right 

to buy from or sell to another party some specified amount of an 

underlying variable or index at a stated price (strike price) during 

a period or on a specified future date, in return for compensation 

(such as a fee or premium). The seller is obligated to purchase or 

sell the variable or index at the discretion of the buyer of the 

contract.

Swaps – obligations between two parties to exchange a series of 

cash flows at periodic intervals (settlement dates), for a specified 

period. The cash flows of a swap are either fixed, or determined 

for each settlement date by multiplying the quantity (notional 

principal) of the underlying variable or index by specified reference rates or prices. Except for currency swaps, the notional principal is used to calculate each payment but is not exchanged.

Derivatives underlying risk exposure – the potential exposure characterized by the level of banks’ concentration in particular underlying 

instruments, in general. Exposure can result from market risk, credit 

risk, and operational risk, as well as, interest rate risk.

Domestic deposits to total assets – total domestic office deposits as 

a percent of total assets on a consolidated basis.

Earning assets – all loans and other investments that earn interest or 

dividend income.

Efficiency ratio – Noninterest expense less amortization of intangible 

assets as a percent of net interest income plus noninterest income. 

This ratio measures the proportion of net operating revenues that 

are absorbed by overhead expenses, so that a lower value indicates 

greater efficiency.

Estimated insured deposits – in general, insured deposits are total 

domestic deposits minus estimated uninsured deposits. Beginning 

March 31, 2008, for institutions that file Call Reports, insured deposits are total assessable deposits minus estimated uninsured deposits. 

Beginning September 30, 2009, insured deposits include deposits in 

accounts of $100,000 to $250,000 that are covered by a temporary 

increase in the FDIC’s standard maximum deposit insurance amount 

(SMDIA). The Dodd-Frank Wall Street Reform and Consumer 

Protection Act enacted on July 21, 2010, made permanent the standard maximum deposit insurance amount (SMDIA) of $250,000. 

Also, the Dodd-Frank Act amended the Federal Deposit Insurance 

Act to include noninterest-bearing transaction accounts as a new 

temporary deposit insurance account category. All funds held in 

noninterest-bearing transaction accounts were fully insured, without 

limit, from December 31, 2010, through December 31, 2012.

Failed/assisted institutions – an institution fails when regulators 

take control of the institution, placing the assets and liabilities into a 

bridge bank, conservatorship, receivership, or another healthy institution. This action may require the FDIC to provide funds to cover 

losses. An institution is defined as “assisted” when the institution 

remains open and receives assistance in order to continue operating.

Fair Value – the valuation of various assets and liabilities on the balance sheet—including trading assets and liabilities, available-for-sale 

securities, loans held for sale, assets and liabilities accounted for 

under the fair value option, and foreclosed assets—involves the use 
2 0 1 6  •Volume 1 0  • Number 3

36 FDIC QUARTERLY

of fair values. During periods of market stress, the fair values of some 

financial instruments and nonfinancial assets may decline.

FHLB advances – all borrowings by FDIC insured institutions from 

the Federal Home Loan Bank System (FHLB), as reported by Call 

Report filers, and by TFR filers prior to March 31, 2012.

Goodwill and other intangibles – intangible assets include servicing 

rights, purchased credit card relationships, and other identifiable 

intangible assets. Goodwill is the excess of the purchase price over the 

fair market value of the net assets acquired, less subsequent impairment adjustments. Other intangible assets are recorded at fair value, 

less subsequent quarterly amortization and impairment adjustments.

Loans secured by real estate – includes home equity loans, junior 

liens secured by 1-4 family residential properties, and all other loans 

secured by real estate.

Loans to individuals – includes outstanding credit card balances and 

other secured and unsecured consumer loans.

Long-term assets (5+ years) – loans and debt securities with remaining maturities or repricing intervals of over five years.

Maximum credit exposure – the maximum contractual credit 

exposure remaining under recourse arrangements and other sellerprovided credit enhancements provided by the reporting bank to 

securitizations.

Mortgage-backed securities – certificates of participation in pools 

of residential mortgages and collateralized mortgage obligations 

issued or guaranteed by government-sponsored or private enterprises. Also, see “Securities,” below.

Net charge-offs – total loans and leases charged off (removed from 

balance sheet because of uncollectability), less amounts recovered on 

loans and leases previously charged off.

Net interest margin – the difference between interest and dividends 

earned on interest-bearing assets and interest paid to depositors and 

other creditors, expressed as a percentage of average earning assets. 

No adjustments are made for interest income that is tax exempt.

Net loans to total assets – loans and lease financing receivables, net 

of unearned income, allowance and reserves, as a percent of total 

assets on a consolidated basis.

Net operating income – income excluding discretionary transactions such as gains (or losses) on the sale of investment securities and 

extraordinary items. Income taxes subtracted from operating income 

have been adjusted to exclude the portion applicable to securities 

gains (or losses).

Noncurrent assets – the sum of loans, leases, debt securities, and 

other assets that are 90 days or more past due, or in nonaccrual status.

Noncurrent loans & leases – the sum of loans and leases 90 days or 

more past due, and loans and leases in nonaccrual status.

Number of institutions reporting – the number of institutions that 

actually filed a financial report.

New reporters – insured institutions filing quarterly financial reports 

for the first time.

Other borrowed funds – federal funds purchased, securities sold with 

agreements to repurchase, demand notes issued to the U.S. Treasury, 

FHLB advances, other borrowed money, mortgage indebtedness, 

obligations under capitalized leases and trading liabilities, less revaluation losses on assets held in trading accounts.

Other real estate owned – primarily foreclosed property. Direct and 

indirect investments in real estate ventures are excluded. The amount 

is reflected net of valuation allowances. For institutions that file a 

Thrift Financial Report (TFR), the valuation allowance subtracted also 

includes allowances for other repossessed assets. Also, for TFR filers 

the components of other real estate owned are reported gross of valuation allowances. (TFR filers began filing Call Reports effective with 

the quarter ending March 31, 2012.)

Percent of institutions with earnings gains – the percent of institutions that increased their net income (or decreased their losses) compared to the same period a year earlier.

“Problem” institutions – federal regulators assign a composite rating 

to each financial institution, based upon an evaluation of financial 

and operational criteria. The rating is based on a scale of 1 to 5 in 

ascending order of supervisory concern. “Problem” institutions are 

those institutions with financial, operational, or managerial weaknesses that threaten their continued financial viability. Depending 

upon the degree of risk and supervisory concern, they are rated 

either a “4” or “5.” The number and assets of “problem” institutions 

are based on FDIC composite ratings. Prior to March 31, 2008, for 

institutions whose primary federal regulator was the OTS, the OTS 

composite rating was used.

Recourse – an arrangement in which a bank retains, in form or in 

substance, any credit risk directly or indirectly associated with an 

asset it has sold (in accordance with generally accepted accounting 

principles) that exceeds a pro rata share of the bank’s claim on the 

asset. If a bank has no claim on an asset it has sold, then the retention 

of any credit risk is recourse.

Reserves for losses – the allowance for loan and lease losses on a 

consolidated basis.

Restructured loans and leases – loan and lease financing receivables with terms restructured from the original contract. Excludes 

restructured loans and leases that are not in compliance with the 

modified terms.

Retained earnings – net income less cash dividends on common and 

preferred stock for the reporting period.

Return on assets – bank net income (including gains or losses on 

securities and extraordinary items) as a percentage of average total 

(consolidated) assets. The basic yardstick of bank profitability.

Return on equity – bank net income (including gains or losses on 

securities and extraordinary items) as a percentage of average total 

equity capital.

Risk-based capital groups – definitions:

Capital Ratios Used to Determine Capital Evaluations for Assessment 

Purposes, Effective January 1, 2015*

Capital 

Evaluations

Total RiskBased Capital 

Ratio

Tier 1 RiskBased Capital 

Ratio

Common Equity 

Tier 1 Capital 

Ratio Leverage Ratio

Well 

Capitalized

≥10% ≥8% ≥6.5% ≥5%

Adequately 

Capitalized**

≥8% ≥6% ≥4.5% ≥4%

UndercapitalizedDoes not qualify as either Well Capitalized or 

Adequately Capitalized

* Effective January 1, 2018, the supplemental leverage ratio will be added to capital 

evaluations for deposit insurance assessment purposes. 

**An institution is Adequately Capitalized if it is not Well Capitalized, but satisfies 

each of the listed capital ratio standards for Adequately Capitalized.
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 37

Risk Categories and Assessment Rate Schedule – The current 

risk categories became effective January 1, 2007. Capital ratios and 

supervisory ratings distinguish one risk category from another. 

Effective April 1, 2011, risk categories for large institutions (generally those with at least $10 billion in assets) were eliminated. The 

following table shows the relationship of risk categories (I, II, III, IV) 

for small institutions to capital and supervisory groups as well as the 

initial base assessment rates (in basis points) for each risk category. 

Supervisory Group A generally includes institutions with CAMELS 

composite ratings of 1 or 2; Supervisory Group B generally includes 

institutions with a CAMELS composite rating of 3; and Supervisory 

Group C generally includes institutions with CAMELS composite ratings of 4 or 5. For purposes of risk-based assessment capital 

groups, undercapitalized includes institutions that are significantly or 

critically undercapitalized.

Capital Category

Supervisory Group

A B C

1. Well Capitalized I

5–9 bps II

14 bps

III

23 bps 2. Adequately 

Capitalized

II

14 bps

3. Undercapitalized III

23 bps

IV

35 bps

Effective April 1, 2011, the initial base assessment rates are 5 to 

35 basis points. An institution’s total assessment rate may be less than 

or greater than its initial base assessment rate as a result of additional 

risk adjustments.

The base assessment rates for small institutions in Risk Category I are 

based on a combination of financial ratios and CAMELS component 

ratings (the financial ratios method).

As required by Dodd-Frank, the calculation of risk-based assessment rates for large institutions no longer relies on long-term debt 

issuer ratings. Rates for large institutions are based on CAMELS 

ratings and certain forward-looking financial measures combined 

into two scorecards—one for most large institutions and another for 

the remaining very large institutions that are structurally and operationally complex or that pose unique challenges and risks in case of 

failure (highly complex institutions). In general, a highly complex 

institution is an institution (other than a credit card bank) with more 

than $500 billion in total assets that is controlled by a parent or intermediate parent company with more than $500 billion in total assets 

or a processing bank or trust company with total fiduciary assets of 

$500 billion or more. The FDIC retains its ability to take additional 

information into account to make a limited adjustment to an institution’s total score (the large bank adjustment), which will be used to 

determine an institution’s initial base assessment rate.

Effective April 1, 2011, the three possible adjustments to an institution’s initial base assessment rate are as follows: (1) Unsecured Debt 

Adjustment: An institution’s rate may decrease by up to 5 basis 

points for unsecured debt. The unsecured debt adjustment cannot 

exceed the lesser of 5 basis points or 50 percent of an institution’s 

initial base assessment rate (IBAR). Thus, for example, an institution with an IBAR of 5 basis points would have a maximum unsecured debt adjustment of 2.5 basis points and could not have a total 

base assessment rate lower than 2.5 basis points. (2) Depository 

Institution Debt Adjustment: For institutions that hold long-term 

unsecured debt issued by another insured depository institution, a 

50 basis point charge is applied to the amount of such debt held in 

excess of 3 percent of an institution’s Tier 1 capital. (3) Brokered 

Deposit Adjustment: Rates for small institutions that are not in Risk 

Category I and for large institutions that are not well capitalized or do 

not have a composite CAMELS rating of 1 or 2 may increase (not to 

exceed 10 basis points) if their brokered deposits exceed 10 percent of 

domestic deposits. After applying all possible adjustments (excluding 

the Depository Institution Debt Adjustment), minimum and maximum total base assessment rates for each risk category are as follows:

Total Base Assessment Rates*

Risk 

Category 

I

Risk 

Category 

II

Risk 

Category 

III

Risk 

Category 

IV

Large and 

Highly Complex 

Institutions

Initial base 

assessment rate 5–9 14 23 35 5–35

Unsecured debt 

adjustment -4.5–0 -5–0 -5–0 -5–0 -5–0

Brokered deposit 

adjustment — 0–10 0–10 0–10 0–10

Total Base 

Assessment rate 2.5–9 9–24 18–33 30–45 2.5–45

* All amounts for all categories are in basis points annually. Total base rates that 

are not the minimum or maximum rate will vary between these rates. Total base 

assessment rates do not include the depository institution debt adjustment.

Beginning in 2007, each institution is assigned a risk-based rate for 

a quarterly assessment period near the end of the quarter following 

the assessment period. Payment is generally due on the 30th day 

of the last month of the quarter following the assessment period. 

Supervisory rating changes are effective for assessment purposes as of 

the examination transmittal date.

Special Assessment – On May 22, 2009, the FDIC board 

approved a final rule that imposed a 5 basis point special assessment as of June 30, 2009. The special assessment was levied on 

each insured depository institution’s assets minus its Tier 1 capital 

as reported in its report of condition as of June 30, 2009. The special assessment was collected September 30, 2009, at the same time 

that the risk-based assessment for the second quarter of 2009 was 

collected. The special assessment for any institution was capped at 

10 basis points of the institution’s assessment base for the second 

quarter of 2009 risk-based assessment.

Prepaid Deposit Insurance Assessments – In November 2009, 

the FDIC Board of Directors adopted a final rule requiring 

insured depository institutions (except those that are exempted) 

to prepay their quarterly risk-based deposit insurance assessments 

for the fourth quarter of 2009, and for all of 2010, 2011, and 2012, 

on December 30, 2009. For regulatory capital purposes, an institution may assign a zero-percent risk weight to the amount of its 

prepaid deposit assessment asset. As required by the FDIC’s regulation establishing the prepaid deposit insurance assessment program, this program ended with the final application of prepaid 

assessments to the quarterly deposit insurance assessments payable March 29, 2013. The FDIC issued refunds of any unused prepaid deposit insurance assessments on June 28, 2013.

Risk-weighted assets – assets adjusted for risk-based capital definitions which include on-balance-sheet as well as off-balance-sheet 

items multiplied by risk-weights that range from zero to 200 percent. 

A conversion factor is used to assign a balance sheet equivalent 

amount for selected off-balance-sheet accounts.

Securities – excludes securities held in trading accounts. Banks’ securities portfolios consist of securities designated as “held-to-maturity,” 
2 0 1 6  •Volume 1 0  • Number 3

38 FDIC QUARTERLY

which are reported at amortized cost (book value), and securities designated as “available-for-sale,” reported at fair (market) value.

Securities gains (losses) – realized gains (losses) on held-tomaturity and available-for-sale securities, before adjustments for 

income taxes. Thrift Financial Report (TFR) filers also include gains 

(losses) on the sales of assets held for sale. (TFR filers began filing 

Call Reports effective with the quarter ending March 31, 2012.)

Seller’s interest in institution’s own securitizations – the reporting 

bank’s ownership interest in loans and other assets that have been 

securitized, except an interest that is a form of recourse or other 

seller-provided credit enhancement. Seller’s interests differ from 

the securities issued to investors by the securitization structure. The 

principal amount of a seller’s interest is generally equal to the total 

principal amount of the pool of assets included in the securitization 

structure less the principal amount of those assets attributable to 

investors, i.e., in the form of securities issued to investors.

Small Business Lending Fund – The Small Business Lending Fund 

(SBLF) was enacted into law in September 2010 as part of the Small 

Business Jobs Act of 2010 to encourage lending to small businesses 

by providing capital to qualified community institutions with assets 

of less than $10 billion. The SBLF Program is administered by the 

U.S. Treasury Department (http://www.treasury.gov/resource-center/

sb-programs/Pages/Small-Business-Lending-Fund.aspx).

Under the SBLF Program, the Treasury Department purchased 

noncumulative perpetual preferred stock from qualifying depository 

institutions and holding companies (other than Subchapter S and 

mutual institutions). When this stock has been issued by a depository 

institution, it is reported as “Perpetual preferred stock and related 

surplus.” For regulatory capital purposes, this noncumulative 

perpetual preferred stock qualifies as a component of Tier 1 capital. 

Qualifying Subchapter S corporations and mutual institutions issue 

unsecured subordinated debentures to the Treasury Department 

through the SBLF. Depository institutions that issued these 

debentures report them as “Subordinated notes and debentures.” 

For regulatory capital purposes, the debentures are eligible for 

inclusion in an institution’s Tier 2 capital in accordance with their 

primary federal regulator’s capital standards. To participate in the 

SBLF Program, an institution with outstanding securities issued 

to the Treasury Department under the Capital Purchase Program 

(CPP) was required to refinance or repay in full the CPP securities 

at the time of the SBLF funding. Any outstanding warrants that an 

institution issued to the Treasury Department under the CPP remain 

outstanding after the refinancing of the CPP stock through the SBLF 

Program unless the institution chooses to repurchase them.

Subchapter S corporation – a Subchapter S corporation is treated 

as a pass-through entity, similar to a partnership, for federal income 

tax purposes. It is generally not subject to any federal income taxes at 

the corporate level. This can have the effect of reducing institutions’ 

reported taxes and increasing their after-tax earnings.

Trust assets – market value, or other reasonably available value of 

fiduciary and related assets, to include marketable securities, and 

other financial and physical assets. Common physical assets held in 

fiduciary accounts include real estate, equipment, collectibles, and 

household goods. Such fiduciary assets are not included in the assets 

of the financial institution.

Unearned income & contra accounts – unearned income for Call 

Report filers only.

Unused loan commitments – includes credit card lines, home equity 

lines, commitments to make loans for construction, loans secured 

by commercial real estate, and unused commitments to originate 

or purchase loans. (Excluded are commitments after June 2003 for 

originated mortgage loans held for sale, which are accounted for as 

derivatives on the balance sheet.)

Yield on earning assets – total interest, dividend, and fee income 

earned on loans and investments as a percentage of average 

earning assets.