QUARTERLY BANKING PROFILE Third Quarter 2016

FDIC QUARTERLY 1

INSURED INSTITUTION PERFORMANCE

Banking Industry Net Income Is $5.2 Billion Higher Than a Year Earlier

Community Bank Revenue and Loan Growth Outpace Industry

Total Loan Balances Rise 6.8 Percent During the Past Year

Net Income Registers 

Strong Increase

Increased net interest income helped boost operating revenues at FDIC-insured institutions 

in the third quarter. The industry reported net income of $45.6 billion for the quarter, an 

increase of $5.2 billion (12.9 percent) compared with the year before. More than 60 percent of 

all banks reported year-over-year increases in quarterly earnings. Only 4.6 percent of banks 

were unprofitable for the quarter, down from 5.2 percent the previous year. The average 

return on assets (ROA) rose to 1.10 percent, from 1.03 percent in third quarter 2015.

Net Interest Margins 

Decline at a Majority of 

Banks

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

totaled $183.3 billion, up $11.2 billion (6.5 percent). Net interest income was $10 billion 

(9.2 percent) higher, while noninterest income rose by $1.2 billion (1.9 percent). The increase 

was attributable to growth in interest-bearing assets (up 6.7 percent over the past 12 months) 

and improvement in the industry’s aggregate net interest margin (NIM), which rose to 

3.18 percent, from 3.08 percent in third quarter 2015. The NIM improvement was not broadbased. A majority of banks—53.5 percent— reported lower NIMs than the year earlier. In 

addition, an accounting change at one large bank resulted in a sizable increase in its interest income for the quarter that contributed to the size of the improvement in the industry’s 

quarterly NIM. The rise in noninterest income was driven by a $1.1 billion increase in 

trading revenue and a $1.6 billion rise in servicing income.

Expense Growth Is Modest Total noninterest expenses were $1.1 billion (1 percent) higher than the year before. Expenses 

for goodwill impairment were $678 million (97.8 percent) lower, while itemized litigation 

expenses were $248 million less. Salary and employee benefit expenses were up $2.4 billion 

(5 percent). The average efficiency ratio—noninterest expense as a percentage of net operating revenue—improved to 57.5 percent in the third quarter, from 60.2 percent a year earlier. 

This is the lowest level for the ratio since second quarter 2010.

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 123412 341234 1 2 341234 1 2 3

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 40.6 39.0

43.6 45.6

Chart 1

Source: FDIC.

Percentage

Unprotable Institutions and Institutions With 

Increased Earnings

All FDIC-Insured Institutions

0

10

20

30

40

50

60

70

80

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Percentage of Institutions With Year-Over-Year

Quarterly Income Growth 

Percentage of Institutions With Quarterly Losses

Chart 2
2 0 1 6  •Volume 1 0  • Number 4

2 FDIC QUARTERLY

Loss Provisions Absorb a 

Rising Share of Revenues

Loan-loss provisions rose year over year for a ninth consecutive quarter to $11.4 billion, a 

$2.9 billion (34 percent) increase over third quarter 2015. Only 39 percent of banks reported 

increases in their provisions, while 30 percent reported reduced provision expenses. For the 

industry, quarterly provisions represented 6.2 percent of the quarter’s net operating revenue, 

up from 4.9 percent the previous year.

Charge-Offs Rise for a 

Fourth Consecutive Quarter

Net loan losses totaled $10.1 billion, up $1.5 billion (16.9 percent) from a year earlier. This 

is the fourth quarter in a row that net charge-offs have posted a year-over-year increase. 

Net charge-offs of loans to commercial and industrial (C&I) borrowers rose $946 million 

(82.7 percent), while credit card charge-offs were $658 million (13.4 percent) higher. Chargeoffs of residential and commercial real estate loans were $371 million (39.1 percent) below 

year-earlier levels. The average net charge-off rate rose to 0.44 percent, from 0.40 percent the 

year before.

Improvement in Real Estate 

Loans Helps Reduce Total 

Noncurrent Loan Balances

Noncurrent loans and leases—those 90 days or more past-due or in nonaccrual status—

declined for the 25th time in the last 26 quarters, falling by $2.5 billion (1.8 percent) during 

the three months ended September 30. During the quarter, noncurrent residential mortgage loan balances fell by $2.7 billion (3.8 percent), while noncurrent home equity loans 

declined by $386 million, and noncurrent nonfarm nonresidential real estate loans fell by 

$367 million (3.7 percent). These improvements exceeded the $1 billion increase in noncurrent credit cards. Noncurrent C&I loans increased for a seventh consecutive quarter, rising 

by $154 million. This is the smallest of the seven quarterly increases in noncurrent C&I 

loans. The average noncurrent loan rate fell from 1.50 percent to 1.45 percent, the lowest level 

since year-end 2007.

Loan-Loss Reserves Post a 

Small Increase

Banks increased their reserves for loan and lease losses for a fourth consecutive quarter, as loan-loss provisions exceeded net charge-offs. Loss reserves rose by $372 million 

(0.3 percent). At banks that itemize their reserves, representing 90 percent of total industry 

reserves, the increase was driven by higher reserves for credit card losses, which rose by 

$1.7 billion (6.1 percent). In contrast with the previous seven quarters, itemized reserves for 

losses on commercial loans declined, falling by $774 million (2.1 percent). The increase in 

industry reserves, combined with the reduction in noncurrent loan balances, caused the 

coverage ratio of reserves to noncurrent loans to rise from 89.2 percent to 91.1 percent during 

the quarter, the highest level since year-end 2007.

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 3

Quarterly Loan-Loss Provisions

All FDIC-Insured Institutions

$ Billions

Source: FDIC.

11.4

0

10

20

30

40

50

60

70

80

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Chart 4
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 3

Retained Earnings 

Account for Most of 

Equity Growth

Total equity capital increased by $16.3 billion (0.9 percent) in third quarter 2016. Retained 

earnings contributed $15.1 billion to equity growth in the third quarter, $458 million 

(0.3 percent) more than a year earlier. Banks declared $30.5 billion in quarterly dividends, a 

$4.8 billion (18.5 percent) increase over third quarter 2015. A $3.7 billion decline in accumulated other comprehensive income limited the growth in equity. The average equity-to-assets 

ratio for the industry declined from 11.28 percent to 11.22 percent. At the end of the quarter, more than 99 percent of all banks, representing 99.9 percent of industry assets, met or 

exceeded the requirements for the highest regulatory capital category as defined for Prompt 

Corrective Action purposes.

Loan Growth 

Remains Steady

Total assets rose by $232.6 billion (1.4 percent) during the third quarter. Total loan and lease 

balances increased by $112 billion (1.2 percent), while investment securities portfolios rose 

by $86.8 billion (2.5 percent), and balances at Federal Reserve banks grew by $41.5 billion 

(3.5 percent). Assets in trading accounts declined by $27 billion (4.4 percent). Growth in 

loans was led by residential mortgage loans (up $28.6 billion, 1.5 percent), loans secured by 

nonfarm nonresidential real estate properties (up $22.4 billion, 1.8 percent), and credit card 

balances (up $15.7 billion, 2.1 percent). For the 12 months ended September 30, total loan 

and lease balances were up $590.8 billion (6.8 percent). The growth in securities was attributable to a $55.3 billion (2.9 percent) rise in mortgage-backed securities, and a $37 billion 

(8.5 percent) increase in U.S. Treasury securities. Unrealized gains on banks’ available-forsale securities fell by $5 billion (11.4 percent), while unrealized gains on securities in held-tomaturity accounts declined by $2.8 billion (11.7 percent).

Deposits Rise by 

$271 Billion

Deposit growth was strong in the third quarter. Total deposits rose by $270.7 billion 

(2.2 percent) in the third quarter. Deposits in domestic offices increased by $259.6 billion 

(2.3 percent), with balances in interest-bearing accounts rising by $140 billion (1.7 percent), 

and balances in noninterest-bearing accounts up by $119.5 billion (4 percent). Balances in 

consumer-oriented accounts increased by $103.8 billion (2.6 percent), while all other domestic office deposits rose by $156.8 billion (2.2 percent). Deposits in foreign offices increased 

by $11.2 billion (0.8 percent). Banks reduced their nondeposit liabilities by $54.3 billion 

(2.5 percent), as trading account liabilities fell by $44.4 billion (14.7 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

Source: FDIC.

*Loan-loss reserves to noncurrent loans & leases.

$ Billions Percent

Reserve Coverage Ratio*

 0

50

100

150

200

250

300

350

400

450

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

0

20

40

60

80

100

120

140

160

180

Noncurrent Loans & Leases ($ Billions)

Loan-Loss Reserves ($ Billions)

Coverage Ratio (Percent)

Chart 6
2 0 1 6  •Volume 1 0  • Number 4

4 FDIC QUARTERLY

Number of FDIC-Insured 

Institutions Is 5,980

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

financial results fell to 5,980 in the third quarter, from 6,058 in the second quarter of 2016. 

There were 71 mergers of insured institutions, while two insured banks failed. No new charters were added during the quarter. Banks reported 2,043,480 full-time equivalent employees, an increase of 4,990 from third quarter 2015. The number of insured institutions on the 

FDIC’s “Problem List” declined from 147 to 132, as total assets of problem banks fell from 

$29 billion to $24.9 billion.

Author:

Ross Waldrop

Senior Banking Analyst

Division of Insurance and Research

(202) 898-3951

Twelve-Month Growth Rate, Total Loans and Leases

All FDIC-Insured Institutions

Percent

Source: FDIC.

6.8

-10

-5

0

5

10

15

2006 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

132

25

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Problem Bank Assets

Number of Problem Banks

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 (%) 1.04 1.05 1.04 1.01 1.07 1.00 0.88

Return on equity (%) 9.29 9.33 9.29 9.01 9.54 8.90 7.79

Core capital (leverage) ratio (%) 9.55 9.61 9.59 9.44 9.40 9.15 9.07

Noncurrent assets plus other real estate owned to assets (%) 0.88 0.99 0.97 1.20 1.63 2.20 2.61

Net charge-offs to loans (%) 0.45 0.42 0.44 0.49 0.69 1.10 1.55

Asset growth rate (%) 6.12 2.94 2.66 5.59 1.94 4.02 4.30

Net interest margin (%) 3.11 3.05 3.07 3.14 3.26 3.42 3.60

Net operating income growth (%) 3.96 5.88 7.09 -0.73 12.82 17.76 43.60

Number of institutions reporting 5,980 6,270 6,182 6,509 6,812 7,083 7,357

Commercial banks 5,170 5,410 5,338 5,607 5,847 6,072 6,275

Savings institutions 810 860 844 902 965 1,011 1,082

Percentage of unprofitable institutions (%) 3.98 4.90 4.76 6.27 8.16 11.00 16.23

Number of problem institutions 132 203 183 291 467 651 813

Assets of problem institutions (in billions) $25 $51 $47 $87 $153 $233 $319

Number of failed institutions 5 6 8 18 24 51 92

Number of assisted institutions 0 0 0 0 0 0 0

* Excludes insured branches of foreign banks (IBAs).

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

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

(dollar figures in millions)  3rd Quarter

2016

2nd Quarter

2016

3rd Quarter

2015

%Change 

15Q3-16Q3

Number of institutions reporting 5,980 6,058 6,270 -4.6

Total employees (full-time equivalent) 2,043,480 2,045,253 2,038,490 0.2

CONDITION DATA

Total assets $16,766,607 $16,533,969 $15,800,126 6.1

Loans secured by real estate 4,567,120 4,505,544 4,307,104 6.0

 1-4 Family residential mortgages 1,989,162 1,960,600 1,887,016 5.4

 Nonfarm nonresidential 1,300,821 1,278,423 1,199,663 8.4

 Construction and development 303,059 294,182 266,508 13.7

 Home equity lines 444,314 452,284 471,539 -5.8

Commercial & industrial loans 1,943,253 1,931,328 1,802,669 7.8

Loans to individuals 1,544,468 1,515,158 1,453,203 6.3

 Credit cards 761,645 745,935 714,790 6.6

Farm loans 80,626 79,098 79,322 1.6

Other loans & leases 1,099,689 1,092,061 1,001,937 9.8

Less: Unearned income 2,074 2,106 1,942 6.8

Total loans & leases 9,233,082 9,121,083 8,642,293 6.8

Less: Reserve for losses 122,060 121,688 118,555 3.0

Net loans and leases 9,111,022 8,999,395 8,523,738 6.9

Securities 3,507,440 3,420,654 3,303,909 6.2

Other real estate owned 11,780 13,154 16,116 -26.9

Goodwill and other intangibles 363,524 359,616 356,957 1.8

All other assets 3,772,840 3,741,149 3,599,405 4.8

Total liabilities and capital 16,766,607 16,533,969 15,800,126 6.1

Deposits 12,798,778 12,528,029 11,990,433 6.7

 Domestic office deposits 11,460,771 11,201,186 10,649,101 7.6

 Foreign office deposits 1,338,006 1,326,842 1,341,332 -0.3

Other borrowed funds 1,445,272 1,457,654 1,382,905 4.5

Subordinated debt 87,037 88,573 92,163 -5.6

All other liabilities 548,753 589,165 537,540 2.1

Total equity capital (includes minority interests) 1,886,768 1,870,549 1,797,085 5.0

 Bank equity capital 1,880,557 1,864,212 1,790,365 5.0

Loans and leases 30-89 days past due 60,077 58,088 61,158 -1.8

Noncurrent loans and leases 134,004 136,377 139,166 -3.7

Restructured loans and leases 67,837 69,620 74,260 -8.7

Mortgage-backed securities 1,979,611 1,924,271 1,818,702 8.9

Earning assets 15,113,755 14,833,251 14,169,622 6.7

FHLB Advances 541,841 545,673 455,479 19.0

Unused loan commitments 7,187,893 7,072,007 6,857,469 4.8

Trust assets 17,873,054 17,381,042 16,865,181 6.0

Assets securitized and sold 763,246 785,857 846,005 -9.8

Notional amount of derivatives 179,902,250 192,350,486 195,399,913 -7.9

INCOME DATA

First Three 

Quarters 2016

First Three 

Quarters 2015 %Change

3rd Quarter 

2016

3rd Quarter 

2015

%Change 

15Q3-16Q3

Total interest income $382,654 $356,355 7.4 $132,537 $120,285 10.2

Total interest expense 39,785 34,683 14.7 13,771 11,545 19.3

Net interest income 342,869 321,672 6.6 118,766 108,740 9.2

Provision for loan and lease losses 35,638 24,958 42.8 11,400 8,505 34.0

Total noninterest income 190,287 190,570 -0.2 64,498 63,289 1.9

Total noninterest expense 314,742 312,522 0.7 106,656 105,560 1.0

Securities gains (losses) 3,165 2,895 9.3 870 838 3.9

Applicable income taxes 57,647 54,356 6.1 20,344 18,282 11.3

Extraordinary gains, net* -281 48 N/M -75 -28 N/M

Total net income (includes minority interests) 128,013 123,348 3.8 45,659 40,492 12.8

 Bank net income 127,772 122,941 3.9 45,593 40,382 12.9

Net charge-offs 30,321 26,560 14.2 10,145 8,678 16.9

Cash dividends 74,179 77,304 -4.0 30,542 25,783 18.5

Retained earnings 53,593 45,637 17.5 15,051 14,600 3.1

Net operating income 126,069 121,283 4.0 45,117 39,951 13.0

* See Notes to Users (page 30) for explanation. N/M - Not Meaningful
2 0 1 6  •Volume 1 0  • Number 4

6 FDIC QUARTERLY

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

Asset Concentration Groups*

THIRD 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 5,980 13 5 1,461 3,013 478 62 304 584 60

Commercial banks 5,170 12 5 1,444 2,708 116 47 278 506 54

Savings institutions 810 1 0 17 305 362 15 26 78 6

Total assets (in billions) $16,766.6 $500.8 $4,145.8 $273.5 $5,678.8 $386.8 $205.5 $54.6 $103.3 $5,417.7

Commercial banks 15,637.2 431.2 4,145.8 267.4 5,186.5 145.7 100.1 49.7 86.8 5,223.9

Savings institutions 1,129.4 69.5 0.0 6.1 492.3 241.1 105.3 4.9 16.4 193.8

Total deposits (in billions) 12,798.8 261.7 2,992.1 224.1 4,465.5 310.2 171.8 43.8 86.8 4,242.9

Commercial banks 11,907.5 208.3 2,992.1 220.8 4,096.3 123.6 83.6 40.5 73.4 4,069.0

Savings institutions 891.3 53.4 0.0 3.3 369.2 186.7 88.2 3.3 13.4 173.9

Bank net income (in millions) 45,593 2,833 9,274 880 14,147 994 519 362 244 16,341

Commercial banks 42,234 2,336 9,274 845 12,741 459 297 177 218 15,888

Savings institutions 3,359 498 0 35 1,406 535 222 185 26 453

Performance Ratios (annualized, %)

Yield on earning assets 3.55 11.77 2.70 4.22 3.69 3.19 4.13 2.95 3.98 3.20

Cost of funding earning assets 0.37 1.22 0.36 0.49 0.40 0.43 0.46 0.32 0.41 0.25

Net interest margin 3.18 10.54 2.35 3.73 3.29 2.76 3.66 2.63 3.58 2.95

Noninterest income to assets 1.55 2.61 1.76 0.71 1.34 1.12 1.55 6.69 1.00 1.55

Noninterest expense to assets 2.57 5.46 2.37 2.57 2.74 2.28 2.93 5.52 3.09 2.23

Loan and lease loss provision to assets 0.27 3.30 0.17 0.13 0.17 -0.04 0.54 0.05 0.10 0.21

Net operating income to assets 1.09 2.26 0.89 1.26 1.00 1.01 1.02 2.58 0.91 1.21

Pretax return on assets 1.59 3.55 1.29 1.53 1.43 1.55 1.61 3.64 1.18 1.79

Return on assets 1.10 2.26 0.90 1.29 1.01 1.04 1.02 2.66 0.95 1.22

Return on equity 9.76 15.08 9.17 11.14 8.40 9.12 10.11 17.21 7.90 10.90

Net charge-offs to loans and leases 0.44 3.11 0.48 0.09 0.23 0.04 0.66 0.16 0.19 0.41

Loan and lease loss provision to 

net charge-offs 112.37 137.38 98.89 210.80 107.76 -165.92 116.37 104.23 94.59 98.68

Efficiency ratio 57.45 43.63 61.66 60.98 62.85 60.53 56.70 60.59 71.23 51.86

% of unprofitable institutions 4.58 0.00 0.00 1.85 5.04 7.11 0.00 5.92 7.19 1.67

% of institutions with earnings gains 60.80 53.85 80.00 55.65 65.78 56.07 66.13 54.61 53.25 73.33

Structural Changes

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

Institutions absorbed by mergers 71 0 0 12 48 4 0 1 6 0

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

PRIOR THIRD QUARTERS

(The way it was...)

Return on assets (%) 2015 1.03 2.83 0.84 0.37 1.00 0.57 1.08 2.55 0.76 1.08

 2013 0.99 3.38 0.52 1.24 0.99 0.92 1.04 1.98 0.85 1.07

 2011 1.03 3.04 1.07 1.28 0.77 0.76 2.08 2.12 1.06 0.99

Net charge-offs to loans & leases (%) 2015 0.40 2.61 0.49 0.08 0.20 0.12 0.58 0.19 0.18 0.37

 2013 0.60 2.91 0.86 0.09 0.35 0.30 0.68 0.46 0.31 0.42

 2011 1.46 5.07 1.68 0.41 1.14 0.77 1.56 0.27 0.54 1.27

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

FDIC QUARTERLY 7

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

Asset Size Distribution Geographic Regions*

THIRD 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 5,980 1,589 3,656 621 104 10 731 731 1,287 1,500 1,280 451

Commercial banks 5,170 1,397 3,169 506 88 10 379 661 1,075 1,444 1,198 413

Savings institutions 810 192 487 115 16 0 352 70 212 56 82 38

Total assets (in billions) $16,766.6 $94.1 $1,171.8 $1,741.0 $4,983.0 $8,776.7 $3,158.5 $3,478.0 $3,785.5 $3,644.3 $1,001.6 $1,698.8

Commercial banks 15,637.2 83.1 993.1 1,427.6 4,356.6 8,776.7 2,725.0 3,393.5 3,672.9 3,585.3 878.8 1,381.7

Savings institutions 1,129.4 10.9 178.7 313.4 626.4 0.0 433.5 84.5 112.6 59.0 122.8 317.1

Total deposits (in billions) 12,798.8 78.4 972.2 1,379.9 3,798.8 6,569.5 2,377.3 2,722.8 2,797.1 2,711.7 820.5 1,369.4

Commercial banks 11,907.5 69.9 830.5 1,141.5 3,296.0 6,569.5 2,051.4 2,655.5 2,715.8 2,665.6 718.7 1,100.4

Savings institutions 891.3 8.5 141.6 238.4 502.8 0.0 325.9 67.4 81.3 46.1 101.8 268.9

Bank net income (in millions) 45,593 226 3,282 4,755 13,475 23,854 6,793 10,833 9,274 9,944 2,867 5,883

Commercial banks 42,234 199 2,789 4,078 11,315 23,854 5,983 10,634 8,912 9,812 2,491 4,402

Savings institutions 3,359 28 494 677 2,160 0 810 199 361 132 376 1,481

Performance Ratios (annualized, %)

Yield on earning assets 3.55 4.16 4.16 4.04 3.99 3.09 3.52 3.88 2.78 3.64 3.99 4.10

Cost of funding earning assets 0.37 0.44 0.46 0.43 0.45 0.29 0.44 0.31 0.30 0.42 0.33 0.40

Net interest margin 3.18 3.71 3.69 3.61 3.54 2.80 3.08 3.57 2.48 3.22 3.66 3.70

Noninterest income to assets 1.55 1.23 1.26 1.26 1.51 1.68 1.34 1.49 1.91 1.33 1.46 1.81

Noninterest expense to assets 2.57 3.46 3.18 2.82 2.65 2.38 2.52 2.54 2.59 2.40 3.10 2.70

Loan and lease loss provision to assets 0.27 0.11 0.12 0.21 0.47 0.20 0.32 0.34 0.11 0.27 0.22 0.45

Net operating income to assets 1.09 0.93 1.10 1.09 1.08 1.09 0.86 1.25 0.99 1.07 1.15 1.38

Pretax return on assets 1.59 1.13 1.42 1.57 1.64 1.59 1.25 1.82 1.42 1.58 1.53 2.14

Return on assets 1.10 0.97 1.13 1.11 1.09 1.10 0.86 1.25 1.00 1.10 1.16 1.40

Return on equity 9.76 7.37 9.84 9.39 8.95 10.38 7.19 10.09 9.73 10.85 10.36 11.55

Net charge-offs to loans and leases 0.44 0.15 0.12 0.23 0.62 0.43 0.50 0.51 0.27 0.47 0.28 0.58

Loan and lease loss provision to 

net charge-offs 112.37 126.25 152.17 130.95 120.91 97.95 117.02 111.95 86.49 110.81 118.17 128.21

Efficiency ratio 57.45 74.23 67.64 60.96 55.13 56.46 60.73 53.45 62.53 55.74 63.66 50.87

% of unprofitable institutions 4.58 9.31 3.17 1.45 0.96 0.00 5.34 7.52 5.75 2.73 3.36 4.88

% of institutions with earnings gains 60.80 51.98 61.82 75.20 73.08 70.00 63.47 64.02 61.77 58.60 57.42 65.41

Structural Changes

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

Institutions absorbed by mergers 71 29 33 8 1 0 9 10 13 18 14 7

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

PRIOR THIRD QUARTERS

(The way it was...)

Return on assets (%) 2015 1.03 0.95 1.05 1.10 1.00 1.02 0.89 1.02 0.92 1.16 1.15 1.18

 2013 0.99 0.73 0.92 1.16 1.11 0.90 1.06 0.94 0.53 1.25 1.06 1.54

 2011 1.03 0.61 0.65 0.91 1.11 1.09 0.97 0.76 0.96 1.26 1.06 1.46

Net charge-offs to loans & leases (%) 2015 0.40 0.16 0.15 0.22 0.52 0.42 0.43 0.44 0.27 0.46 0.24 0.51

 2013 0.60 0.28 0.34 0.31 0.80 0.59 0.81 0.55 0.46 0.75 0.28 0.50

 2011 1.46 0.63 0.92 1.00 1.89 1.42 1.79 1.70 1.02 1.66 0.88 1.05

* See Table V-A (page 11) for explanations.
2 0 1 6  •Volume 1 0  • Number 4

8 FDIC QUARTERLY

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

Asset Concentration Groups*

FIRST THREE QUARTERS

(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 5,980 13 5 1,461 3,013 478 62 304 584 60

Commercial banks 5,170 12 5 1,444 2,708 116 47 278 506 54

Savings institutions 810 1 0 17 305 362 15 26 78 6

Total assets (in billions) $16,766.6 $500.8 $4,145.8 $273.5 $5,678.8 $386.8 $205.5 $54.6 $103.3 $5,417.7

Commercial banks 15,637.2 431.2 4,145.8 267.4 5,186.5 145.7 100.1 49.7 86.8 5,223.9

Savings institutions 1,129.4 69.5 0.0 6.1 492.3 241.1 105.3 4.9 16.4 193.8

Total deposits (in billions) 12,798.8 261.7 2,992.1 224.1 4,465.5 310.2 171.8 43.8 86.8 4,242.9

Commercial banks 11,907.5 208.3 2,992.1 220.8 4,096.3 123.6 83.6 40.5 73.4 4,069.0

Savings institutions 891.3 53.4 0.0 3.3 369.2 186.7 88.2 3.3 13.4 173.9

Bank net income (in millions) 127,772 8,604 27,208 2,521 40,744 2,767 1,513 1,041 729 42,645

Commercial banks 117,345 7,343 27,208 2,446 35,615 1,360 883 490 654 41,346

Savings institutions 10,426 1,261 0 75 5,129 1,407 629 550 75 1,299

Performance Ratios (annualized, %)

Yield on earning assets 3.48 11.38 2.70 4.16 3.68 3.20 4.08 2.97 3.99 3.04

Cost of funding earning assets 0.36 1.15 0.35 0.47 0.40 0.43 0.45 0.33 0.40 0.24

Net interest margin 3.11 10.24 2.34 3.69 3.28 2.77 3.63 2.65 3.58 2.80

Noninterest income to assets 1.55 2.71 1.80 0.67 1.33 1.01 1.49 6.51 0.95 1.54

Noninterest expense to assets 2.57 5.47 2.36 2.54 2.73 2.26 2.86 5.48 3.03 2.27

Loan and lease loss provision to assets 0.29 3.07 0.20 0.14 0.18 -0.06 0.55 0.04 0.10 0.24

Net operating income to assets 1.03 2.31 0.89 1.21 0.98 0.96 1.00 2.50 0.92 1.05

Pretax return on assets 1.51 3.58 1.30 1.46 1.41 1.48 1.58 3.49 1.19 1.59

Return on assets 1.04 2.31 0.90 1.24 0.99 0.99 1.01 2.56 0.96 1.08

Return on equity 9.29 15.56 9.09 10.86 8.26 8.67 10.01 16.82 8.04 9.64

Net charge-offs to loans and leases 0.45 3.21 0.53 0.11 0.20 0.05 0.65 0.16 0.18 0.42

Loan and lease loss provision to 

net charge-offs 117.54 124.75 105.93 186.70 128.74 -187.63 118.29 89.64 100.62 112.14

Efficiency ratio 58.29 44.39 60.72 61.45 62.89 61.95 56.53 61.32 70.66 54.71

% of unprofitable institutions 3.98 0.00 0.00 1.78 4.08 7.74 1.61 4.93 5.99 1.67

% of institutions with earnings gains 63.46 38.46 60.00 60.30 67.91 57.11 58.06 54.28 58.05 78.33

Condition Ratios (%)

Earning assets to total assets 90.14 91.75 87.50 93.24 90.84 95.11 97.10 91.58 92.76 90.44

Loss allowance to:

Loans and leases 1.32 3.92 1.50 1.41 1.11 0.79 1.17 1.57 1.33 1.21

Noncurrent loans and leases 91.09 304.34 93.49 144.47 104.44 29.24 99.94 109.89 106.46 63.86

Noncurrent assets plus

other real estate owned to assets 0.88 1.01 0.62 0.79 0.88 1.78 0.87 0.59 1.00 1.01

Equity capital ratio 11.22 15.17 9.79 11.61 11.98 11.33 10.00 15.46 12.01 11.10

Core capital (leverage) ratio 9.55 12.68 8.72 10.98 10.12 11.14 9.93 14.35 11.64 9.01

Common equity tier 1 capital ratio 12.86 12.15 13.22 14.58 12.29 22.65 16.39 31.74 19.67 12.46

Tier 1 risk-based capital ratio 12.95 12.28 13.25 14.59 12.42 22.70 16.62 31.75 19.71 12.53

Total risk-based capital ratio 14.31 14.53 14.17 15.71 13.81 23.56 17.59 32.65 20.95 14.09

Net loans and leases to deposits 71.19 144.57 49.07 81.40 87.38 77.25 83.08 34.33 66.56 64.22

Net loans to total assets 54.34 75.55 35.41 66.72 68.71 61.96 69.45 27.49 55.97 50.30

Domestic deposits to total assets 68.35 50.80 47.56 81.96 78.34 80.20 83.59 80.09 84.10 72.90

Structural Changes

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

Institutions absorbed by mergers 186 0 0 26 137 8 1 3 10 1

Failed institutions 5 0 0 0 4 0 0 0 1 0

PRIOR FIRST THREE QUARTERS

(The way it was...)

Number of institutions 2015 6,270 14 4 1,494 3,125 515 56 337 663 62

 2013 6,891 17 4 1,536 3,433 597 47 400 791 66

 2011 7,437 18 5 1,552 3,854 714 71 363 801 59

Total assets (in billions) 2015 $15,800.1 $519.5 $3,836.6 $274.8 $5,508.9 $416.3 $184.3 $54.9 $118.3 $4,886.7

 2013 14,603.6 596.3 3,729.4 243.9 4,773.6 554.0 149.3 63.9 137.9 4,355.3

 2011 13,811.9 532.0 3,665.3 208.5 4,170.5 798.3 98.9 54.0 136.4 4,148.1

Return on assets (%) 2015 1.05 2.91 0.88 0.91 0.99 0.74 1.12 2.59 0.50 1.08

 2013 1.06 3.26 0.83 1.19 0.91 0.98 1.28 1.74 0.87 1.10

 2011 0.92 3.62 0.81 1.14 0.71 0.60 1.75 1.80 0.92 0.89

Net charge-offs to loans & leases (%) 2015 0.42 2.72 0.56 0.08 0.19 0.13 0.58 0.18 0.17 0.38

 2013 0.72 3.21 1.03 0.11 0.44 0.37 0.77 0.61 0.32 0.51

 2011 1.61 5.58 2.07 0.36 1.21 0.90 1.78 0.48 0.50 1.30

Noncurrent assets plus 

OREO to assets (%) 2015 0.99 0.83 0.72 0.75 0.96 1.95 1.00 0.70 1.16 1.19

 2013 1.75 0.90 1.13 0.98 1.81 2.16 0.66 0.95 1.56 2.37

 2011 2.66 1.41 1.59 1.59 3.19 2.68 1.13 0.99 1.87 3.36

Equity capital ratio (%) 2015 11.33 14.83 9.98 11.49 11.81 11.63 10.22 15.50 12.10 11.42

 2013 11.11 14.89 8.80 11.01 11.81 11.40 9.64 13.71 11.34 11.77

 2011 11.30 15.79 8.81 11.50 11.93 10.61 9.86 15.50 11.68 12.37

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

FDIC QUARTERLY 9

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

Asset Size Distribution Geographic Regions*

FIRST THREE QUARTERS

(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 5,980 1,589 3,656 621 104 10 731 731 1,287 1,500 1,280 451

Commercial banks 5,170 1,397 3,169 506 88 10 379 661 1,075 1,444 1,198 413

Savings institutions 810 192 487 115 16 0 352 70 212 56 82 38

Total assets (in billions) $16,766.6 $94.1 $1,171.8 $1,741.0 $4,983.0 $8,776.7 $3,158.5 $3,478.0 $3,785.5 $3,644.3 $1,001.6 $1,698.8

Commercial banks 15,637.2 83.1 993.1 1,427.6 4,356.6 8,776.7 2,725.0 3,393.5 3,672.9 3,585.3 878.8 1,381.7

Savings institutions 1,129.4 10.9 178.7 313.4 626.4 0.0 433.5 84.5 112.6 59.0 122.8 317.1

Total deposits (in billions) 12,798.8 78.4 972.2 1,379.9 3,798.8 6,569.5 2,377.3 2,722.8 2,797.1 2,711.7 820.5 1,369.4

Commercial banks 11,907.5 69.9 830.5 1,141.5 3,296.0 6,569.5 2,051.4 2,655.5 2,715.8 2,665.6 718.7 1,100.4

Savings institutions 891.3 8.5 141.6 238.4 502.8 0.0 325.9 67.4 81.3 46.1 101.8 268.9

Bank net income (in millions) 127,772 669 9,359 13,389 39,376 64,978 19,829 26,517 26,582 29,125 8,016 17,702

Commercial banks 117,345 585 8,000 11,518 32,265 64,978 17,537 25,982 25,589 28,761 6,970 12,507

Savings institutions 10,426 85 1,360 1,871 7,111 0 2,292 535 993 365 1,046 5,195

Performance Ratios (annualized, %)

Yield on earning assets 3.48 4.12 4.13 4.01 3.97 2.98 3.47 3.61 2.78 3.62 3.96 4.07

Cost of funding earning assets 0.36 0.44 0.46 0.42 0.44 0.29 0.43 0.31 0.30 0.41 0.32 0.39

Net interest margin 3.11 3.68 3.68 3.58 3.53 2.69 3.03 3.31 2.48 3.22 3.64 3.68

Noninterest income to assets 1.55 1.17 1.20 1.21 1.53 1.69 1.34 1.46 1.89 1.35 1.41 1.93

Noninterest expense to assets 2.57 3.39 3.16 2.83 2.65 2.39 2.53 2.58 2.56 2.41 3.08 2.73

Loan and lease loss provision to assets 0.29 0.11 0.12 0.20 0.48 0.23 0.31 0.36 0.15 0.29 0.25 0.44

Net operating income to assets 1.03 0.92 1.06 1.05 1.07 1.00 0.85 1.01 0.97 1.07 1.08 1.43

Pretax return on assets 1.51 1.10 1.37 1.51 1.64 1.47 1.23 1.51 1.40 1.57 1.44 2.21

Return on assets 1.04 0.95 1.09 1.07 1.08 1.01 0.85 1.03 0.98 1.09 1.10 1.43

Return on equity 9.29 7.39 9.56 9.08 8.91 9.56 7.13 8.37 9.48 10.77 9.89 11.87

Net charge-offs to loans and leases 0.45 0.15 0.11 0.21 0.62 0.46 0.48 0.53 0.27 0.51 0.30 0.55

Loan and lease loss provision to 

net charge-offs 117.54 118.44 158.99 137.77 123.39 106.94 117.11 117.79 116.46 107.01 131.86 132.10

Efficiency ratio 58.29 74.19 68.25 61.98 55.18 57.83 61.40 57.53 61.87 55.74 64.29 50.34

% of unprofitable institutions 3.98 8.68 2.57 0.81 0.96 0.00 5.34 6.29 4.97 2.47 2.66 3.99

% of institutions with earnings gains 63.46 54.31 65.56 73.91 67.31 60.00 63.20 66.07 63.17 61.00 63.36 68.96

Condition Ratios (%)

Earning assets to total assets 90.14 92.19 92.89 92.16 91.46 88.60 89.37 89.67 89.38 89.92 91.95 93.67

Loss allowance to:

Loans and leases 1.32 1.42 1.31 1.15 1.38 1.33 1.24 1.37 1.30 1.37 1.25 1.35

Noncurrent loans and leases 91.09 105.90 127.57 117.99 111.11 72.41 107.84 81.98 85.41 75.09 94.67 172.52

Noncurrent assets plus

other real estate owned to assets 0.88 1.19 1.02 0.84 0.82 0.89 0.70 1.07 0.81 1.04 1.04 0.53

Equity capital ratio 11.22 13.15 11.47 11.80 12.18 10.50 12.03 12.39 10.18 10.08 11.22 12.05

Core capital (leverage) ratio 9.55 12.72 11.02 10.46 10.34 8.69 9.93 9.64 9.10 8.85 10.02 10.93

Common equity tier 1 capital ratio 12.86 20.19 15.39 13.49 12.87 12.29 12.97 12.76 12.69 11.98 13.12 15.03

Tier 1 risk-based capital ratio 12.95 20.23 15.44 13.51 13.05 12.34 13.12 12.86 12.75 11.99 13.22 15.20

Total risk-based capital ratio 14.31 21.30 16.56 14.54 14.66 13.64 14.58 14.35 13.90 13.47 14.35 16.38

Net loans and leases to deposits 71.19 70.73 80.11 87.11 80.40 61.20 72.24 74.05 65.23 69.69 77.90 74.78

Net loans to total assets 54.34 58.96 66.46 69.04 61.29 45.81 54.37 57.97 48.20 51.86 63.82 60.28

Domestic deposits to total assets 68.35 83.36 82.95 78.97 74.32 60.75 67.95 75.33 64.75 56.78 81.80 79.76

Structural Changes

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

Institutions absorbed by mergers 186 65 102 18 1 0 27 27 44 40 31 17

Failed institutions 5 4 1 0 0 0 1 1 1 0 2 0

PRIOR FIRST THREE QUARTERS

(The way it was...)

Number of institutions 2015 6,270 1,752 3,812 596 102 8 780 778 1,351 1,559 1,319 483

 2013 6,891 2,116 4,107 561 100 7 854 875 1,480 1,675 1,454 553

 2011 7,437 2,491 4,279 561 99 7 924 974 1,563 1,792 1,555 629

Total assets (in billions) 2015 $15,800.1 $102.7 $1,194.8 $1,642.8 $5,053.2 $7,806.6 $3,018.8 $3,324.0 $3,531.9 $3,436.7 $940.8 $1,548.0

 2013 14,603.6 123.5 1,245.5 1,453.0 4,726.0 7,055.7 2,876.9 2,981.8 3,398.6 3,166.6 864.0 1,315.8

 2011 13,811.9 142.9 1,273.4 1,425.1 4,398.0 6,572.7 2,842.2 2,954.3 3,169.9 2,901.9 801.8 1,141.7

Return on assets (%) 2015 1.05 0.89 1.01 1.15 1.01 1.06 0.90 1.03 0.94 1.18 1.12 1.28

 2013 1.06 0.76 0.92 1.18 1.03 1.08 0.82 1.03 0.91 1.26 1.12 1.54

 2011 0.92 0.54 0.59 0.85 1.13 0.87 1.07 0.61 0.81 0.98 0.97 1.47

Net charge-offs to loans & leases (%) 2015 0.42 0.15 0.13 0.21 0.53 0.46 0.46 0.48 0.26 0.50 0.20 0.49

 2013 0.72 0.30 0.34 0.38 0.94 0.73 0.97 0.69 0.50 0.91 0.33 0.58

 2011 1.61 0.58 0.85 1.17 2.04 1.63 1.97 1.73 1.19 1.94 0.87 1.18

Noncurrent assets plus 

OREO to assets (%) 2015 0.99 1.30 1.20 0.99 0.74 1.12 0.76 1.19 0.96 1.22 1.07 0.53

 2013 1.75 1.83 1.98 1.96 1.10 2.09 1.20 2.48 1.54 2.08 1.72 1.03

 2011 2.66 2.39 3.18 3.26 1.96 2.90 1.79 3.81 2.40 2.77 2.75 2.17

Equity capital ratio (%) 2015 11.33 12.83 11.35 11.92 12.19 10.63 11.99 12.44 10.35 10.28 11.26 12.28

 2013 11.11 11.82 10.83 11.76 12.44 10.12 12.00 12.30 9.13 10.64 10.87 12.85

 2011 11.30 11.98 10.80 11.85 12.97 10.14 12.55 12.18 8.62 11.18 11.15 13.71

* See Table V-A (page 11) for explanations.
2 0 1 6  •Volume 1 0  • Number 4

10 FDIC QUARTERLY

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

Asset Concentration Groups*

September 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 0.71 0.19 1.00 0.59 0.46 0.87 0.50 1.30 1.11 1.06

Construction and development 0.32 0.00 0.49 0.65 0.32 0.61 0.31 1.13 0.76 0.19

Nonfarm nonresidential 0.26 0.00 0.47 0.52 0.24 0.26 0.92 0.90 0.70 0.21

Multifamily residential real estate 0.12 0.00 0.01 0.26 0.14 0.10 0.12 0.70 0.59 0.16

Home equity loans 0.64 0.00 1.09 0.42 0.46 0.63 0.36 0.55 0.55 0.71

Other 1-4 family residential 1.23 0.21 1.40 1.06 0.86 0.98 0.50 1.73 1.45 1.66

Commercial and industrial loans 0.24 0.93 0.26 0.86 0.26 0.33 0.12 1.16 0.94 0.16

Loans to individuals 1.31 1.48 1.21 1.31 1.11 0.49 0.76 1.91 1.54 1.48

Credit card loans 1.28 1.48 1.14 1.00 0.91 1.57 0.80 2.24 1.27 1.11

Other loans to individuals 1.34 1.32 1.33 1.34 1.14 0.44 0.74 1.87 1.55 1.70

All other loans and leases (including farm) 0.22 0.25 0.33 0.51 0.19 0.16 0.30 0.43 0.44 0.13

Total loans and leases 0.65 1.45 0.72 0.63 0.44 0.80 0.65 1.30 1.08 0.77

Percent of Loans Noncurrent**

All real estate loans 2.02 0.63 2.93 0.97 1.09 3.01 2.59 1.62 1.40 3.44

Construction and development 0.80 0.00 0.42 0.79 0.84 0.94 5.62 2.32 1.14 0.63

Nonfarm nonresidential 0.74 0.00 0.70 1.07 0.71 1.55 6.06 1.51 1.73 0.66

Multifamily residential real estate 0.19 0.00 0.11 0.44 0.20 0.52 0.70 2.84 1.07 0.15

Home equity loans 2.40 0.00 3.64 0.50 1.32 2.02 2.23 0.68 0.60 3.42

Other 1-4 family residential 3.39 0.70 4.22 0.96 1.81 3.36 2.29 1.62 1.42 5.12

Commercial and industrial loans 1.34 0.78 1.45 1.48 1.35 0.91 0.25 1.32 1.18 1.28

Loans to individuals 0.85 1.31 0.98 0.58 0.71 0.24 0.60 0.92 0.76 0.58

Credit card loans 1.18 1.34 1.07 0.24 0.88 0.46 1.22 1.21 0.61 1.00

Other loans to individuals 0.54 0.60 0.81 0.61 0.69 0.23 0.44 0.88 0.77 0.33

All other loans and leases (including farm) 0.22 0.05 0.15 0.81 0.30 0.13 6.93 0.33 0.34 0.11

Total loans and leases 1.45 1.29 1.60 0.98 1.06 2.69 1.17 1.43 1.25 1.89

Percent of Loans Charged-Off (net, YTD)

All real estate loans 0.06 0.05 0.08 0.03 0.04 0.04 0.14 0.07 0.08 0.08

Construction and development -0.05 0.00 0.12 -0.03 -0.05 -0.19 1.56 0.17 -0.01 -0.11

Nonfarm nonresidential 0.01 0.00 0.01 0.02 0.02 0.02 0.33 0.00 0.11 -0.05

Multifamily residential real estate 0.00 0.00 0.00 0.10 0.00 0.01 0.00 1.54 0.05 -0.01

Home equity loans 0.28 -1.48 0.35 -0.05 0.17 0.03 0.40 0.10 0.07 0.41

Other 1-4 family residential 0.07 0.08 0.06 0.05 0.07 0.05 0.04 0.04 0.09 0.08

Commercial and industrial loans 0.43 2.38 0.39 0.25 0.42 0.08 0.04 0.15 0.41 0.42

Loans to individuals 1.88 3.24 2.27 0.44 0.82 0.32 0.91 0.49 0.55 1.54

Credit card loans 3.05 3.33 3.06 1.32 2.20 1.28 2.48 1.00 1.80 2.76

Other loans to individuals 0.73 1.60 0.92 0.37 0.62 0.28 0.49 0.42 0.52 0.79

All other loans and leases (including farm) 0.12 0.14 0.07 0.21 0.19 0.12 0.05 0.54 0.52 0.10

Total loans and leases 0.45 3.21 0.53 0.11 0.20 0.05 0.65 0.16 0.18 0.42

Loans Outstanding (in billions)

All real estate loans $4,567.1 $0.2 $551.7 $112.1 $2,417.6 $213.0 $34.2 $10.8 $44.6 $1,183.0

Construction and development 303.1 0.0 12.0 6.7 221.1 4.9 0.4 0.8 2.8 54.4

Nonfarm nonresidential 1,300.8 0.0 46.0 29.7 928.6 17.6 2.5 3.6 10.3 262.5

Multifamily residential real estate 374.2 0.0 69.6 3.5 248.2 5.8 0.4 0.3 1.3 45.1

Home equity loans 444.3 0.0 60.5 2.2 207.0 10.1 5.6 0.4 1.9 156.6

Other 1-4 family residential 1,989.2 0.2 316.1 28.2 771.7 174.0 25.0 5.1 24.8 644.0

Commercial and industrial loans 1,943.3 14.7 318.6 21.3 924.5 6.6 7.5 1.8 4.9 643.3

Loans to individuals 1,544.5 378.6 263.5 6.7 299.5 6.5 100.0 1.7 4.6 483.4

Credit card loans 761.6 360.5 167.9 0.5 31.9 0.3 20.5 0.2 0.1 179.8

Other loans to individuals 782.8 18.2 95.6 6.2 267.6 6.2 79.6 1.5 4.5 303.5

All other loans and leases (including farm) 1,180.3 0.2 357.2 45.0 305.2 15.5 2.8 0.9 4.5 448.9

Total loans and leases (plus unearned income) 9,235.2 393.8 1,491.1 185.1 3,946.8 241.6 144.5 15.3 58.6 2,758.4

Memo: Other Real Estate Owned (in millions)

All other real estate owned 11,780.0 0.1 607.7 339.2 7,866.7 330.5 90.4 103.0 295.5 2,146.8

Construction and development 3,703.4 0.0 0.2 114.9 3,032.4 80.0 9.5 46.4 101.7 318.2

Nonfarm nonresidential 3,101.4 0.0 52.3 119.6 2,470.1 39.3 13.6 27.9 86.9 291.7

Multifamily residential real estate 190.0 0.0 1.0 14.5 160.0 3.2 0.1 3.1 3.9 4.2

1-4 family residential 3,977.4 0.1 380.2 64.0 1,992.5 184.7 55.3 24.6 95.3 1,180.8

Farmland 143.5 0.0 0.0 26.0 103.8 1.4 0.1 0.8 7.5 3.8

GNMA properties 651.3 0.0 163.0 0.2 107.9 22.0 11.8 0.2 0.1 346.0

* 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*

September 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 0.71 1.11 0.56 0.36 0.57 1.06 0.48 0.88 0.76 0.98 0.67 0.30

Construction and development 0.32 1.03 0.46 0.31 0.31 0.22 0.36 0.28 0.23 0.33 0.41 0.32

Nonfarm nonresidential 0.26 0.84 0.38 0.25 0.22 0.21 0.30 0.25 0.27 0.26 0.30 0.12

Multifamily residential real estate 0.12 0.64 0.25 0.13 0.11 0.07 0.10 0.22 0.10 0.07 0.19 0.11

Home equity loans 0.64 0.62 0.47 0.40 0.49 0.80 0.41 0.77 0.75 0.69 0.51 0.30

Other 1-4 family residential 1.23 1.60 0.86 0.57 1.03 1.64 0.82 1.48 1.19 1.62 1.37 0.52

Commercial and industrial loans 0.24 1.19 0.61 0.37 0.21 0.19 0.22 0.16 0.26 0.23 0.45 0.32

Loans to individuals 1.31 1.77 1.37 1.29 1.21 1.41 1.09 1.77 1.07 1.27 1.02 1.24

Credit card loans 1.28 4.56 2.03 1.70 1.39 1.11 1.05 1.43 1.05 1.19 0.81 1.78

Other loans to individuals 1.34 1.72 1.33 1.15 0.96 1.67 1.15 2.12 1.07 1.36 1.12 0.79

All other loans and leases (including farm) 0.22 0.55 0.40 0.23 0.17 0.23 0.18 0.11 0.33 0.23 0.32 0.17

Total loans and leases 0.65 1.09 0.59 0.42 0.59 0.77 0.52 0.78 0.62 0.74 0.64 0.50

Percent of Loans Noncurrent** 

All real estate loans 2.02 1.39 1.03 0.92 1.50 3.41 1.49 2.57 2.28 2.89 1.26 0.61

Construction and development 0.80 1.48 1.37 0.91 0.47 0.62 0.86 1.31 0.61 0.55 0.65 0.64

Nonfarm nonresidential 0.74 1.52 0.97 0.71 0.69 0.64 0.93 0.67 0.82 0.72 0.72 0.47

Multifamily residential real estate 0.19 0.54 0.59 0.21 0.12 0.15 0.16 0.23 0.20 0.22 0.37 0.15

Home equity loans 2.40 0.66 0.61 0.68 1.45 3.58 2.34 3.05 2.43 2.36 1.35 0.63

Other 1-4 family residential 3.39 1.47 1.14 1.44 2.62 5.06 2.34 4.09 3.55 4.85 2.37 0.80

Commercial and industrial loans 1.34 1.88 1.32 1.44 1.43 1.25 0.99 1.36 1.11 1.59 2.13 1.29

Loans to individuals 0.85 0.84 0.78 0.76 0.98 0.74 0.90 0.94 0.71 0.80 0.90 0.85

Credit card loans 1.18 2.35 1.44 1.48 1.30 1.02 1.04 1.23 1.05 1.09 1.22 1.57

Other loans to individuals 0.54 0.81 0.74 0.52 0.56 0.50 0.66 0.63 0.59 0.42 0.76 0.25

All other loans and leases (including farm) 0.22 0.92 0.67 0.64 0.23 0.14 0.20 0.15 0.19 0.26 0.29 0.33

Total loans and leases 1.45 1.34 1.03 0.98 1.24 1.84 1.15 1.67 1.52 1.82 1.32 0.78

Percent of Loans Charged-Off (net, YTD) 

All real estate loans 0.06 0.05 0.05 0.03 0.05 0.08 0.06 0.10 0.07 0.06 0.02 -0.01

Construction and development -0.05 -0.10 0.00 -0.06 -0.08 -0.05 -0.02 -0.01 -0.04 -0.10 -0.05 -0.16

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

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

Home equity loans 0.28 0.10 0.05 0.10 0.21 0.39 0.19 0.42 0.23 0.37 0.16 0.00

Other 1-4 family residential 0.07 0.09 0.07 0.05 0.08 0.07 0.10 0.09 0.07 0.07 0.03 0.00

Commercial and industrial loans 0.43 0.44 0.27 0.42 0.48 0.41 0.32 0.38 0.36 0.48 0.65 0.58

Loans to individuals 1.88 0.71 0.73 1.47 2.08 1.79 2.01 2.02 1.15 2.24 1.35 1.84

Credit card loans 3.05 11.23 4.57 3.64 3.15 2.89 2.74 3.20 2.94 3.15 2.37 3.42

Other loans to individuals 0.73 0.55 0.46 0.73 0.61 0.84 0.77 0.77 0.53 1.07 0.88 0.47

All other loans and leases (including farm) 0.12 0.13 0.20 0.39 0.13 0.09 0.14 0.09 0.10 0.13 0.29 0.14

Total loans and leases 0.45 0.15 0.11 0.21 0.62 0.46 0.48 0.53 0.27 0.51 0.30 0.55

Loans Outstanding (in billions) 

All real estate loans $4,567.1 $38.1 $607.8 $879.8 $1,376.8 $1,664.7 $927.0 $922.9 $935.1 $873.5 $408.0 $500.6

Construction and development 303.1 2.2 56.0 81.4 96.6 66.8 54.7 59.3 50.4 46.4 60.7 31.5

Nonfarm nonresidential 1,300.8 9.5 229.6 354.6 420.3 286.9 295.0 268.3 199.9 186.9 164.3 186.4

Multifamily residential real estate 374.2 1.1 32.5 89.0 137.7 114.0 136.6 44.2 97.0 32.1 16.7 47.5

Home equity loans 444.3 0.9 25.6 48.5 143.8 225.5 86.2 116.4 109.8 83.2 19.8 28.9

Other 1-4 family residential 1,989.2 17.2 216.2 286.2 563.2 906.3 350.6 421.9 455.0 436.5 130.2 194.9

Commercial and industrial loans 1,943.3 6.6 98.4 188.6 709.4 940.3 298.4 482.4 418.0 396.8 126.2 221.5

Loans to individuals 1,544.5 3.6 31.7 83.2 702.1 723.9 328.2 386.3 220.7 315.3 61.9 232.1

Credit card loans 761.6 0.1 2.1 21.1 401.4 337.0 204.9 196.7 56.1 179.6 19.4 104.8

Other loans to individuals 782.8 3.6 29.6 62.1 300.6 386.9 123.3 189.5 164.6 135.6 42.5 127.3

All other loans and leases (including farm) 1,180.3 8.0 51.7 65.0 309.3 746.3 185.8 252.9 274.9 331.1 51.4 84.2

Total loans and leases 

(plus unearned income) 9,235.2 56.3 789.5 1,216.6 3,097.6 4,075.2 1,739.4 2,044.4 1,848.7 1,916.7 647.5 1,038.5

Memo: Other Real Estate Owned 

(in millions) 

All other real estate owned 11,780.0 360.5 3,715.0 2,691.2 2,473.5 2,539.9 1,985.8 2,820.5 2,281.2 2,043.1 1,775.1 874.4

Construction and development 3,703.4 124.3 1,703.1 1,083.0 451.8 341.2 330.1 1,077.5 508.8 742.6 760.5 283.8

Nonfarm nonresidential 3,101.4 113.2 1,174.1 835.3 679.5 299.4 512.8 638.0 618.3 415.0 592.2 325.1

Multifamily residential real estate 190.0 15.2 78.8 62.4 15.7 17.9 44.1 32.5 25.9 49.5 20.4 17.6

1-4 family residential 3,977.4 101.1 675.5 648.3 1,162.3 1,390.2 1,024.1 961.8 901.7 524.2 345.6 220.0

Farmland 143.5 6.5 78.9 45.5 10.3 2.2 6.9 40.1 21.8 16.5 45.6 12.6

GNMA properties 651.3 0.2 4.5 16.7 153.7 476.0 67.7 70.5 204.6 282.2 10.8 15.3

* 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 4

12 FDIC QUARTERLY

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

3rd 

Quarter 

2016

2nd 

Quarter 

2016

1st

Quarter 

2016

4th

Quarter 

2015

3rd 

Quarter 

2015

% 

Change 

15Q3-

16Q3

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 1,440 1,446 1,429 1,414 1,418 1.6 64 849 420 97 10

Total assets of institutions reporting derivatives $15,188,973 $15,033,334 $14,766,799 $14,422,442 $14,231,258 6.7 $4,918 $357,633 $1,311,261 $4,738,420 $8,776,741

Total deposits of institutions reporting derivatives 11,513,763 11,313,838 11,189,545 10,938,376 10,735,417 7.3 4,103 293,936 1,043,882 3,602,309 6,569,533

Total derivatives 179,902,250 192,350,486 195,508,825 181,986,620 195,399,913 -7.9 272 26,500 130,616 45,723,148 134,021,715

Derivative Contracts by Underlying Risk Exposure 

Interest rate 132,992,944 143,794,699 147,218,272 138,363,456 148,665,387 -10.5 272 26,482 124,748 39,714,914 93,126,528

Foreign exchange* 36,299,774 37,701,788 37,129,026 33,133,791 34,638,122 4.8 0 1 4,744 5,412,955 30,882,074

Equity 2,734,807 2,672,364 2,533,921 2,395,120 2,508,972 9.0 0 6 291 178,291 2,556,219

Commodity & other (excluding credit derivatives) 1,312,260 1,328,302 1,209,774 1,107,759 1,389,755 -5.6 0 6 73 80,130 1,232,051

Credit 6,562,465 6,853,333 7,417,833 6,986,493 8,197,677 -19.9 0 6 760 336,857 6,224,843

Total 179,902,250 192,350,486 195,508,825 181,986,620 195,399,913 -7.9 272 26,500 130,616 45,723,148 134,021,715

Derivative Contracts by Transaction Type 

Swaps 103,013,911 111,900,682 114,814,419 107,392,487 112,697,189 -8.6 50 7,642 75,587 28,363,516 74,567,116

Futures & forwards 36,958,352 38,790,406 37,151,052 35,684,999 38,988,244 -5.2 70 9,562 28,147 7,144,237 29,776,336

Purchased options 15,466,148 16,277,239 16,857,478 15,469,691 16,817,381 -8.0 6 654 5,012 4,797,222 10,663,254

Written options 15,459,962 16,012,000 16,706,898 15,419,416 16,236,717 -4.8 146 8,636 20,809 4,975,225 10,455,147

Total 170,898,372 182,980,326 185,529,847 173,966,592 184,739,531 -7.5 272 26,494 129,555 45,280,199 125,461,853

Fair Value of Derivative Contracts 

Interest rate contracts 77,293 75,052 75,481 67,223 76,692 0.8 -4 31 -227 34,019 43,473

Foreign exchange contracts 13,372 11,369 -11,530 -12,485 -15,284 N/M 0 0 -9 5,673 7,709

Equity contracts 1,643 6,637 5,035 5,318 7,880 -79.1 0 0 0 486 1,157

Commodity & other (excluding credit derivatives) -2,185 -3,151 -4,310 -3,571 -6,952 N/M 0 0 1 158 -2,343

Credit derivatives as guarantor 17,871 1,037 2,901 -2,697 1,890 845.6 0 -1 -2 -200 18,074

Credit derivatives as beneficiary -17,575 -167 -966 7,076 2,441 N/M 0 0 -28 686 -18,233

Derivative Contracts by Maturity** 

Interest rate contracts < 1 year 58,874,863 66,424,471 65,650,642 55,047,362 60,754,367 -3.1 67 8,763 27,174 13,111,643 45,727,215

 1-5 years 45,382,718 47,001,897 50,714,670 49,406,784 52,458,012 -13.5 20 2,020 28,795 12,648,454 32,703,429

 > 5 years 32,522,071 33,930,510 34,846,003 32,980,646 34,618,605 -6.1 32 5,724 42,124 10,464,334 22,009,857

Foreign exchange and gold contracts < 1 year 25,797,765 26,622,784 26,231,748 24,129,842 25,206,603 2.3 0 0 2,482 3,022,185 22,773,097

 1-5 years 4,096,173 4,112,254 4,081,595 3,986,436 3,672,989 11.5 0 0 564 386,575 3,709,034

 > 5 years 1,901,381 2,150,431 1,819,360 1,647,804 1,500,445 26.7 0 0 163 197,934 1,703,285

Equity contracts < 1 year 1,954,392 1,907,096 1,841,069 1,743,252 1,610,476 21.4 0 0 20 63,701 1,890,671

 1-5 years 821,844 709,947 674,710 627,875 671,362 22.4 0 0 105 46,141 775,597

 > 5 years 129,226 134,063 129,076 130,188 183,539 -29.6 0 0 4 15,548 113,674

 Commodity & other contracts (including credit 

derivatives, excluding gold contracts) < 1 year 2,826,215 3,032,137 2,813,615 2,651,133 2,566,099 10.1 0 5 33 83,820 2,742,356

 1-5 years 4,009,114 4,354,280 4,800,922 4,694,153 5,771,045 -30.5 0 5 91 155,739 3,853,278

 > 5 years 540,260 368,331 619,196 405,131 750,909 -28.1 0 0 149 31,858 508,253

Risk-Based Capital: Credit Equivalent Amount 

Total current exposure to tier 1 capital (%) 35.2 37.2 34.5 30.1 34.3 0.0 0.6 1.2 21.3 51.8

Total potential future exposure to tier 1 capital (%) 41.0 43.5 47.5 48.3 50.3 0.1 0.3 0.7 15.7 66.3

Total exposure (credit equivalent amount) 

to tier 1 capital (%) 76.2 80.7 82.0 78.4 84.6 0.2 0.9 1.8 37.0 118.1

Credit losses on derivatives*** 38.0 32.0 13.0 78.0 72.0 -47.2 0.0 0.0 0.0 14.0 24

HELD FOR TRADING 

Number of institutions reporting derivatives 251 257 252 250 247 1.6 4 95 89 54 9

Total assets of institutions reporting derivatives 12,138,728 11,985,165 11,719,847 11,460,982 11,384,424 6.6 291 40,229 329,528 3,256,467 8,512,214

Total deposits of institutions reporting derivatives 9,188,820 8,976,508 8,831,049 8,660,644 8,553,870 7.4 257 33,390 259,585 2,549,515 6,346,072

Derivative Contracts by Underlying Risk Exposure 

Interest rate 130,490,614 141,316,485 144,689,891 136,029,963 146,136,877 -10.7 8 1,655 31,272 39,177,815 91,279,865

Foreign exchange 33,353,870 34,671,042 34,029,316 31,666,580 31,766,032 5.0 0 0 3,745 5,286,886 28,063,240

Equity 2,718,187 2,656,373 2,510,439 2,370,468 2,486,427 9.3 0 0 0 164,846 2,553,341

Commodity & other 1,310,469 1,326,621 1,208,052 1,105,989 1,387,414 -5.5 0 1 39 79,090 1,231,340

Total 167,873,141 179,970,521 182,437,698 171,173,001 181,776,750 -7.6 8 1,656 35,056 44,708,637 123,127,785

Trading Revenues: Cash & Derivative Instruments 

Interest rate 2,959 1,906 3,072 155 2,581 14.6 0 1 26 668 2,264

Foreign exchange 2,294 3,736 1,407 3,401 1,931 18.8 0 0 4 172 2,118

Equity 728 972 670 741 50 1,356.0 0 0 3 35 690

Commodity & other (including credit derivatives) 440 420 455 -25 758 -42.0 0 0 2 -74 512

Total trading revenues 6,421 7,034 5,604 4,271 5,319 20.7 0 1 35 801 5,584

Share of Revenue 

Trading revenues to gross revenues (%) 4.9 5.5 4.6 3.5 4.4 0.0 0.2 1.0 2.4 5.9

Trading revenues to net operating revenues (%) 20.7 24.7 22.6 15.7 19.9 0.0 0.9 4.8 11.4 24.1

HELD FOR PURPOSES OTHER THAN TRADING 

Number of institutions reporting derivatives 1,319 1,325 1,302 1,299 1,305 1.1 61 772 384 92 10

Total assets of institutions reporting derivatives 14,893,505 14,754,861 14,523,798 14,205,001 13,960,566 6.7 4,715 327,194 1,224,302 4,560,552 8,776,741

Total deposits of institutions reporting derivatives 11,271,299 11,087,199 10,994,534 10,764,768 10,518,599 7.2 3,923 268,463 974,400 3,454,981 6,569,533

Derivative Contracts by Underlying Risk Exposure 

Interest rate 2,502,330 2,478,214 2,528,380 2,333,492 2,528,510 -1.0 264 24,827 93,476 537,099 1,846,664

Foreign exchange 504,491 513,919 538,565 433,677 409,385 23.2 0 0 698 19,978 483,815

Equity 16,620 15,991 23,483 24,652 22,545 -26.3 0 6 291 13,445 2,878

Commodity & other 1,791 1,681 1,722 1,770 2,342 -23.5 0 5 34 1,040 711

Total notional amount 3,025,231 3,009,806 3,092,149 2,793,591 2,962,781 2.1 264 24,838 94,499 571,562 2,334,068

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)

3rd 

Quarter 

2016

2nd 

Quarter

2016

1st 

Quarter

2016

4th 

Quarter

2015

3rd 

Quarter

2015

% 

Change 

15Q3-

16Q3

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 76 75 74 73 72 5.6 0 18 17 34 7

Outstanding Principal Balance by Asset Type 

1-4 family residential loans $668,418 $687,085 $704,676 $715,914 $734,519 -9.0 $0 $2,117 $11,549 $85,785 $568,966

Home equity loans 27 29 29 30 31 -12.9 0 0 0 27 0

Credit card receivables 13,491 13,485 13,400 13,502 14,187 -4.9 0 0 0 13,397 94

Auto loans 11,024 8,935 5,604 6,095 6,221 77.2 0 0 2,269 8,755 0

Other consumer loans 4,733 4,908 5,093 5,286 4,754 -0.4 0 1 0 2,445 2,287

Commercial and industrial loans 166 169 204 15 14 1085.7 0 6 0 0 160

All other loans, leases, and other assets 65,387 71,246 74,712 79,844 86,277 -24.2 0 94 8,187 515 56,591

Total securitized and sold 763,246 785,857 803,719 820,686 846,005 -9.8 0 2,218 22,005 110,925 628,098

Maximum Credit Exposure by Asset Type 

1-4 family residential loans 2,114 2,514 2,617 2,840 2,933 -27.9 0 4 0 1,388 723

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

Credit card receivables 1,209 1,207 1,152 1,108 1,187 1.9 0 0 0 1,209 0

Auto loans 436 0 0 0 0 0.0 0 0 0 436 0

Other consumer loans 96 91 86 89 89 7.9 0 0 0 0 96

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

All other loans, leases, and other assets 841 971 902 990 1,319 -36.2 0 0 0 4 837

Total credit exposure 4,696 4,783 4,757 5,026 5,528 -15.1 0 4 0 3,037 1,656

Total unused liquidity commitments provided to institution’s own 

securitizations 140 138 73 36 37 278.4 0 0 0 0 140

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

1-4 family residential loans 3.7 3.6 3.1 3.9 3.8 0.0 1.2 1.4 3.1 3.8

Home equity loans 5.5 8.6 6.2 5.4 5.9 0.0 0.0 0.0 5.5 0

Credit card receivables 0.4 0.3 0.4 0.4 0.4 0.0 0.0 0.0 0.4 1.1

Auto loans 1.5 1.3 1.2 1.5 1.1 0.0 0.0 2.5 1.2 0

Other consumer loans 4.4 3.8 3.8 3.9 4.3 0.0 0.0 0.0 1.9 7.2

Commercial and industrial loans 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 0.4 0.5 0.5 0.3 0.0 3.2 0.4 0.9 0.4

Total loans, leases, and other assets 3.3 3.3 2.8 3.5 3.3 0.0 1.3 1.2 2.6 3.5

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

1-4 family residential loans 1.5 1.6 1.6 2.0 2.1 0.0 1.1 0.5 1.3 1.5

Home equity loans 47.4 45.5 47.3 47.8 47.4 0.0 0.0 0.0 47.4 0

Credit card receivables 0.3 0.3 0.3 0.3 0.3 0.0 0.0 0.0 0.3 1.1

Auto loans 0.3 0.2 0.2 0.2 0.2 0.0 0.0 0.5 0.2 0

Other consumer loans 3.8 3.6 3.9 3.9 4.4 0.0 0.0 0.0 0.9 6.8

Commercial and industrial loans 0.0 0.1 0.1 1.0 1.2 0.0 0.0 0.0 0.0 0

All other loans, leases, and other assets 1.5 1.3 1.4 1.2 1.2 0.0 9.2 0.3 1.5 1.6

Total loans, leases, and other assets 1.4 1.5 1.6 1.9 2.0 0.0 1.5 0.4 1.1 1.5

Securitized Loans, Leases, and Other Assets Charged-off 

(net, YTD, annualized, %) 

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

Home equity loans 3.6 2.2 1.0 5.2 3.2 0.0 0.0 0.0 3.6 0

Credit card receivables 3.7 3.4 3.0 1.8 1.4 0.0 0.0 0.0 3.7 3.2

Auto loans 0.5 0.3 0.3 0.4 0.2 0.0 0.0 1.1 0.4 0

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

Commercial and industrial loans 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 0.3 0.4 0.1 0.6 0.5 0.0 0.0 0.0 0.1 0.4

Total loans, leases, and other assets 0.3 0.2 0.1 0.4 0.3 0.0 0.1 0.1 0.5 0.3

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 11,355 11,954 12,811 15,059 13,248 -14.3 0 0 0 11,355 0

Commercial and industrial loans 216 219 268 0 0 N/M 0 0 0 0 216

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 1,078 1,088 1,091 1,089 1,099 -1.9 112 726 184 48 8

Outstanding Principal Balance by Asset Type 

1-4 family residential loans 37,751 36,579 36,826 38,602 39,013 -3.2 1,296 16,533 8,793 4,819 6,310

Home equity, credit card receivables, auto, and other consumer loans 626 634 684 712 714 -12.3 0 3 42 32 549

Commercial and industrial loans 339 340 271 215 217 56.2 0 18 136 160 24

All other loans, leases, and other assets 84,258 80,687 79,266 73,499 72,201 16.7 0 17 1,170 21,679 61,392

Total sold and not securitized 122,974 118,240 117,047 113,028 112,145 9.7 1,296 16,571 10,142 26,690 68,275

Maximum Credit Exposure by Asset Type 

1-4 family residential loans 10,997 10,833 9,503 10,037 10,495 4.8 83 3,329 3,371 2,813 1,402

Home equity, credit card receivables, auto, and other consumer loans 148 134 161 163 134 10.4 0 3 19 2 124

Commercial and industrial loans 183 186 181 151 154 18.8 0 18 5 160 0

All other loans, leases, and other assets 23,286 22,193 21,684 20,138 19,655 18.5 0 14 59 6,614 16,598

Total credit exposure 34,615 33,346 31,529 30,489 30,438 13.7 83 3,364 3,454 9,589 18,124

Support for Securitization Facilities Sponsored by Other Institutions 

Number of institutions reporting securitization facilities sponsored by others 104 109 110 111 110 -5.5 7 56 22 13 6

Total credit exposure 40,187 42,341 41,078 41,500 42,211 -4.8 8 137 231 2,481 37,331

Total unused liquidity commitments 1,411 2,853 1,387 834 884 59.6 0 14 2 701 695

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 23,084 21,665 18,378 13,980 12,020 92.0 0 0 0 0 23,084

Unused liquidity commitments to conduits sponsored by institutions 

 and others 24,417 24,287 26,866 29,257 27,631 -11.6 0 0 6 2,586 21,825

Net servicing income (for the quarter) 2,673 1,166 864 3,328 1,040 157.0 7 266 159 842 1,401

Net securitization income (for the quarter) 287 181 203 250 348 -17.5 0 10 11 194 73

Total credit exposure to Tier 1 capital (%)** 5.1 5.3 5.1 5.2 5.3 0.8 2.8 2.1 3.0 7.8

* 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.

Quarterly Net Income Increases 11.8 Percent to $5.6 Billion From the Previous Year

Net Interest Income Rises $1.2 Billion From 2015, Led by Strong Loan Growth

Net Interest Margin of 3.58 Percent Declines From Third Quarter 2015

Loan-Loss Provisions Rise $188 Million From 2015 to $718.2 Million

Noncurrent and Net Charge-Off Rates Increase for Commercial and Industrial Loans

Close to 60 Percent of 

Community Banks Increase 

Their Quarterly Net Income

Quarterly net income for the 5,521 community banks totaled $5.6 billion in third quarter 

2016, an increase of $592.6 million (11.8 percent) compared with the 2015 quarter. Higher 

net operating revenue (the sum of net interest income and total noninterest income) helped 

lift quarterly net income, which was partly offset by higher loan-loss provisions and noninterest expense. Noncommunity banks increased their quarterly net income by $4.9 billion 

(13.8 percent) from third quarter 2015, led by a few large noncommunity banks. Pretax 

return on assets for community banks was 1.38 percent, up 4 basis points from second quarter 2016 and 8 basis points from a year earlier. The number of FDIC-insured community 

banks declined from 5,602 in the second quarter to 5,521 (down 81), with two community 

bank failures.

Net Operating Revenue 

Increases 8.5 Percent From 

Last Year

Improvement in net interest income (up $1.2 billion, or 7.2 percent) and noninterest income 

(up $613.5 million, or 13.1 percent) helped lift third-quarter net operating revenue to 

$23 billion, a $1.8 billion (8.5 percent) increase from the previous year. The benefit of higher 

interest income from non 1-to-4 family real estate loans (up $751.8 million, or 10.1 percent) 

drove the increase in net interest income from the 2015 quarter.1 Close to 67 percent of 

the year-over-year increase in noninterest income was led by net gains on loan sales (up 

$410.1 million, or 38.6 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

0.0

0.5

1.0

1.5

$0.59 $1.19 $0.19 $0.61 $0.91 $0.09 $0.20

+35%

+12%

+7%

+13%

+6%

+99%

+13%

Chart 1

Source: FDIC.

Net Interest Margin 

Percent

3.0 

3.5 

4.0 

Community Banks

All Insured Institutions 

3.58

3.18

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 4

16 FDIC QUARTERLY

Change in Loan Balances and Unused Commitments 

FDIC-Insured Community Banks 

Source: FDIC.

$ Billions

Change 3Q 2016 vs. 3Q 2015

Change 3Q 2016 vs. 2Q 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

40.0

15.9

13.3

22.4

2.3

11.9

5.6

9.7

2.4

6.3

3.4 1.4 2.9 3.4

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

Net Interest Margin 

Declines Modestly 

From a Year Ago

The average net interest margin (NIM) declined from 3.62 percent in third quarter 2015 to 

3.58 percent, as asset yields decreased (down 3 basis points) and funding costs increased (up 

1 basis point). NIM at community banks was 46 basis points higher than that of noncommunity banks. The difference narrowed from third quarter 2015, as NIM for community banks 

declined and NIM for noncommunity banks improved (up 13 basis points).

Noninterest Expense 

Increases for 

Community Banks

Over the past 12 months, noninterest expense grew by $909.5 million (6.4 percent) to 

$15.1 billion. Close to 70 percent of community banks increased their noninterest expense 

from the year before. The annual increase in noninterest expense was led by higher salary 

and employee benefits, which rose by $676 million (8.5 percent). Full-time employees at 

community banks were 12,585 (3 percent) higher than third quarter 2015. The average asset 

per employee totaled $5 million for the third quarter, up from $4.8 million a year earlier. 

Noninterest expense as a percent of net operating revenue declined to 65.8 percent—the 

lowest level since third quarter 2007.

Loan and Lease Balances 

Increase 9.4 Percent From

Third Quarter 2015

Total assets of $2.2 trillion rose by $37.5 billion (1.8 percent) from second quarter 2016, as 

loan and lease balances grew by $31.1 billion (2.1 percent). Close to 71 percent of community banks grew their loan and lease balances from the previous quarter. The largest quarterly increase was among nonfarm nonresidential loans (up $9.7 billion, or 2.3 percent), 

1-to-4 family residential mortgages (up $6.3 billion, or 1.6 percent), construction and development loans (up $3.4 billion, or 3.6 percent), multifamily residential loans (up $3.4 billion, 

or 3.4 percent), and commercial and industrial loans (up $2.4 billion, or 1.2 percent). Loan 

and lease balances rose by $127.6 billion (9.4 percent) over the previous 12 months, exceeding 6.5 percent growth at noncommunity banks. Close to 62 percent of the annual increase 

in loan and lease balances was led by nonfarm nonresidential loans (up $40 billion, or 

10.2 percent), 1-to-4 family residential mortgages (up $22.4 billion, or 6.2 percent), and 

multifamily residential loans (up $16.5 billion, or 19.1 percent). Unused loan commitments 

were $6.2 billion (2.3 percent) higher than in third quarter 2015, with commercial real 

estate, including construction and development, rising by $11.9 billion (16.6 percent).
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 17

Small Loans to Businesses 

Increase Almost 3 Percent 

From the Year Before

In third quarter 2016, small loans to businesses of $298.3 billion rose by $1.6 billion 

(0.5 percent) from the previous quarter while declining by $1.7 billion (0.4 percent) for 

noncommunity banks.2 The increase at community banks was led by agricultural production loans (up $1.2 billion, or 4.3 percent), while commercial and industrial loans declined 

(down $472.1 million, or 0.5 percent). The 12-month increase in small loans to businesses at 

community banks (up $8.3 billion, or 2.9 percent) was led by nonfarm nonresidential loans 

(up $3.4 billion, or 2.4 percent) and commercial and industrial loans (up $3.2 billion, or 

3.5 percent). Community banks held 43 percent of small loans to businesses.

Noncurrent Rate 

Continues to Improve

Slightly more than half (50.4 percent) of community banks reduced their noncurrent 

loan and lease balances from second quarter 2016, resulting in a decline of $87.6 million 

(0.6 percent). The noncurrent rate was 0.99 percent, down 7 basis points from the previous quarter and 55 basis points below the 1.54 percent for noncommunity banks. All major 

loan categories at community banks had lower noncurrent rates compared with the previous quarter except for commercial and industrial loans (up 1 basis point). For the past five 

consecutive quarters, the noncurrent rate for commercial and industrial loans was 18 basis 

points above the third quarter 2015 rate. The largest quarterly improvement in the noncurrent rate was among construction and development loans and 1-to-4 family residential mortgages, with both declining by 10 basis points.

Net Charge-Off Rate 

Remains Relatively Stable 

From the Year Before

For community banks, the net charge-off rate rose by 1 basis point from the previous year 

to 0.15 percent; for noncommunity banks, the rate increased by 4 basis points to 0.5 percent. 

The net charge-off rate for all major loan categories at community banks improved from 

third quarter 2015, except for commercial and industrial loans, which rose by 17 basis points 

to 0.45 percent.

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 4

18 FDIC QUARTERLY

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

2016* 2015* 2015 2014 2013 2012 2011

Return on assets (%) 1.02 0.99 0.99 0.93 0.90 0.83 0.55

Return on equity (%) 9.13 8.87 8.85 8.45 8.27 7.68 5.19

Core capital (leverage) ratio (%) 10.72 10.72 10.67 10.57 10.43 10.18 9.98

Noncurrent assets plus other real estate owned to assets (%) 0.94 1.14 1.07 1.34 1.73 2.26 2.84

Net charge-offs to loans (%) 0.12 0.13 0.15 0.21 0.32 0.58 0.87

Asset growth rate (%) 2.67 3.15 2.71 2.21 0.43 2.25 1.60

Net interest margin (%) 3.56 3.58 3.57 3.61 3.59 3.67 3.74

Net operating income growth (%) 4.97 10.16 9.53 4.82 14.63 56.21 207.82

Number of institutions reporting 5,521 5,812 5,735 6,037 6,307 6,541 6,798

Percentage of unprofitable institutions (%) 4.13 5.16 4.97 6.44 8.40 11.15 16.34

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

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

(dollar figures in millions)  3rd Quarter

2016

2nd Quarter

2016

3rd Quarter

2015

%Change 

15Q3-16Q3

Number of institutions reporting 5,521 5,602 5,812 -5.0

Total employees (full-time equivalent) 428,552 436,809 439,199 -2.4

CONDITION DATA

Total assets $2,151,502 $2,146,404 $2,095,630 2.7

Loans secured by real estate 1,137,164 1,125,963 1,076,089 5.7

 1-4 Family residential mortgages 386,432 382,052 373,802 3.4

 Nonfarm nonresidential 432,201 430,740 412,074 4.9

 Construction and development 98,887 97,571 90,293 9.5

 Home equity lines 50,518 50,658 50,093 0.8

Commercial & industrial loans 199,419 201,650 192,896 3.4

Loans to individuals 58,846 60,814 59,917 -1.8

 Credit cards 1,859 2,119 2,191 -15.2

Farm loans 52,470 51,271 50,563 3.8

Other loans & leases 40,068 39,392 35,493 12.9

Less: Unearned income 641 633 588 9.0

Total loans & leases 1,487,326 1,478,457 1,414,369 5.2

Less: Reserve for losses 18,238 18,587 18,658 -2.2

Net loans and leases 1,469,088 1,459,871 1,395,711 5.3

Securities 417,992 427,800 438,108 -4.6

Other real estate owned 5,326 5,843 7,235 -26.4

Goodwill and other intangibles 14,206 14,277 13,741 3.4

All other assets 244,890 238,613 240,836 1.7

Total liabilities and capital 2,151,502 2,146,404 2,095,630 2.7

Deposits 1,762,652 1,752,764 1,717,380 2.6

 Domestic office deposits 1,762,431 1,752,355 1,716,994 2.6

 Foreign office deposits 221 409 385 -42.7

 Brokered deposits 76,553 75,307 69,913 9.5

Estimated insured deposits 1,316,400 1,318,279 1,305,972 0.8

Other borrowed funds 127,685 132,254 125,040 2.1

Subordinated debt 802 831 455 76.1

All other liabilities 17,543 17,260 16,805 4.4

Total equity capital (includes minority interests) 242,820 243,295 235,950 2.9

 Bank equity capital 242,708 243,193 235,831 2.9

Loans and leases 30-89 days past due 7,547 7,886 8,204 -8.0

Noncurrent loans and leases 14,755 15,672 16,530 -10.7

Restructured loans and leases 8,311 8,803 9,685 -14.2

Mortgage-backed securities 178,728 183,316 184,594 -3.2

Earning assets 2,001,297 1,995,831 1,945,723 2.9

FHLB Advances 100,344 103,873 93,863 6.9

Unused loan commitments 279,899 281,156 286,517 -2.3

Trust assets 254,155 261,048 241,989 5.0

Assets securitized and sold 13,056 16,616 15,357 -15.0

Notional amount of derivatives 74,052 70,957 53,239 39.1

INCOME DATA

First Three 

Quarters 2016

First Three 

Quarters 2015 %Change

3rd Quarter 

2016

3rd Quarter 

2015

%Change 

15Q3-16Q3

Total interest income $58,733 $57,453 2.2 $20,045 $19,658 2.0

Total interest expense 6,734 6,528 3.2 2,314 2,208 4.8

Net interest income 52,000 50,925 2.1 17,731 17,450 1.6

Provision for loan and lease losses 2,031 1,684 20.6 718 560 28.2

Total noninterest income 14,885 14,621 1.8 5,303 4,953 7.1

Total noninterest expense 44,437 44,623 -0.4 15,150 15,157 0.0

Securities gains (losses) 601 453 32.6 189 100 89.6

Applicable income taxes 4,937 4,473 10.4 1,721 1,592 8.1

Extraordinary gains, net* 0 24 -98.5 -2 1 N/M

Total net income (includes minority interests) 16,081 15,243 5.5 5,632 5,195 8.4

 Bank net income 16,063 15,219 5.5 5,625 5,188 8.4

Net charge-offs 1,328 1,301 2.0 564 478 18.0

Cash dividends 7,151 6,888 3.8 2,151 2,209 -2.6

Retained earnings 8,912 8,331 7.0 3,473 2,979 16.6

Net operating income 15,605 14,867 5.0 5,483 5,119 7.1

* See Notes to Users (page 30) for explanation. 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)  3rd Quarter 

2016

2nd Quarter 

2016

3rd Quarter

2015

%Change 

15Q3-16Q3

Number of institutions reporting 5,521 5,521 5,521 0.0

Total employees (full-time equivalent) 428,552 427,671 415,967 3.0

CONDITION DATA

Total assets $2,151,502 $2,114,039 $2,017,745 6.6

Loans secured by real estate 1,137,164 1,112,496 1,036,927 9.7

 1-4 Family residential mortgages 386,432 380,179 364,014 6.2

 Nonfarm nonresidential 432,201 422,489 392,217 10.2

 Construction and development 98,887 95,443 85,630 15.5

 Home equity lines 50,518 49,756 47,702 5.9

Commercial & industrial loans 199,419 196,970 183,509 8.7

Loans to individuals 58,846 57,636 55,824 5.4

 Credit cards 1,859 1,822 1,871 -0.6

Farm loans 52,470 51,042 50,179 4.6

Other loans & leases 40,068 38,707 33,866 18.3

Less: Unearned income 641 631 594 8.0

Total loans & leases 1,487,326 1,456,220 1,359,712 9.4

Less: Reserve for losses 18,238 18,162 17,829 2.3

Net loans and leases 1,469,088 1,438,058 1,341,883 9.5

Securities 417,992 422,415 424,970 -1.6

Other real estate owned 5,326 5,659 6,842 -22.2

Goodwill and other intangibles 14,206 13,873 13,126 8.2

All other assets 244,890 234,034 230,925 6.0

Total liabilities and capital 2,151,502 2,114,039 2,017,745 6.6

Deposits 1,762,652 1,726,676 1,653,632 6.6

 Domestic office deposits 1,762,431 1,726,458 1,653,433 6.6

 Foreign office deposits 221 217 198 11.3

 Brokered deposits 76,553 72,922 65,109 17.6

Estimated insured deposits 1,316,400 1,297,992 1,256,923 4.7

Other borrowed funds 127,685 130,651 120,650 5.8

Subordinated debt 802 782 430 86.5

All other liabilities 17,543 16,968 16,095 9.0

Total equity capital (includes minority interests) 242,820 238,963 226,938 7.0

 Bank equity capital 242,708 238,850 226,815 7.0

Loans and leases 30-89 days past due 7,547 7,611 7,761 -2.8

Noncurrent loans and leases 14,755 14,843 15,389 -4.1

Restructured loans and leases 8,311 8,311 8,952 -7.2

Mortgage-backed securities 178,728 180,075 176,812 1.1

Earning assets 2,001,297 1,966,804 1,874,230 6.8

FHLB Advances 100,344 103,185 91,054 10.2

Unused loan commitments 279,899 274,875 273,655 2.3

Trust assets 254,155 249,092 231,366 9.8

Assets securitized and sold 13,056 12,707 11,662 11.9

Notional amount of derivatives 74,052 69,347 49,787 48.7

INCOME DATA

First Three 

Quarters 2016

First Three 

Quarters 2015 %Change

3rd Quarter 

2016

3rd Quarter 

2015

%Change 

15Q3-16Q3

Total interest income $58,733 $54,481 7.8 $20,045 $18,640 7.5

Total interest expense 6,734 6,195 8.7 2,314 2,094 10.5

Net interest income 52,000 48,287 7.7 17,731 16,545 7.2

Provision for loan and lease losses 2,031 1,510 34.5 718 530 35.5

Total noninterest income 14,885 13,852 7.5 5,303 4,690 13.1

Total noninterest expense 44,437 41,986 5.8 15,150 14,240 6.4

Securities gains (losses) 601 449 33.7 189 95 99.2

Applicable income taxes 4,937 4,388 12.5 1,721 1,522 13.1

Extraordinary gains, net* 0 2 N/M -2 1 N/M

Total net income (includes minority interests) 16,081 14,706 9.4 5,632 5,039 11.8

 Bank net income 16,063 14,684 9.4 5,625 5,032 11.8

Net charge-offs 1,328 1,104 20.3 564 421 34.1

Cash dividends 7,151 6,704 6.7 2,151 2,149 0.1

Retained earnings 8,912 7,980 11.7 3,473 2,883 20.5

Net operating income 15,605 14,354 8.7 5,483 4,963 10.5

* See Notes to Users (page 30) for explanation. N/M - Not Meaningful
2 0 1 6  •Volume 1 0  • Number 4

20 FDIC QUARTERLY

TABLE III-B. Aggregate Condition and Income Data by Geographic Region, FDIC-Insured Community Banks

Third Quarter 2016

(dollar figures in millions) All Community Banks

Geographic Regions*

New York Atlanta Chicago Kansas City Dallas San Francisco

Number of institutions reporting 5,521 637 670 1,215 1,443 1,198 358

Total employees (full-time equivalent) 428,552 83,305 52,955 90,740 70,732 93,653 37,167

CONDITION DATA

Total assets $2,151,502 $559,692 $244,899 $393,094 $334,189 $414,892 $204,737

Loans secured by real estate 1,137,164 340,299 136,502 200,463 156,147 197,064 106,689

 1-4 Family residential mortgages 386,432 127,164 44,696 71,703 50,077 64,223 28,570

 Nonfarm nonresidential 432,201 119,691 58,302 72,699 51,186 80,108 50,215

 Construction and development 98,887 19,741 15,503 13,462 13,073 28,393 8,713

 Home equity lines 50,518 16,976 7,659 11,414 4,870 4,528 5,072

Commercial & industrial loans 199,419 49,182 18,929 37,224 33,120 41,839 19,126

Loans to individuals 58,846 11,692 6,053 12,126 10,161 13,664 5,150

 Credit cards 1,859 172 129 422 538 298 300

Farm loans 52,470 549 1,418 8,364 28,764 10,357 3,018

Other loans & leases 40,068 12,068 3,157 7,072 5,724 8,383 3,663

Less: Unearned income 641 160 120 59 55 125 122

Total loans & leases 1,487,326 413,630 165,940 265,190 233,860 271,182 137,524

Less: Reserve for losses 18,238 4,232 2,061 3,400 3,163 3,539 1,843

Net loans and leases 1,469,088 409,398 163,879 261,790 230,697 267,643 135,681

Securities 417,992 92,925 46,133 82,544 65,640 91,679 39,071

Other real estate owned 5,326 707 1,378 1,015 828 1,075 322

Goodwill and other intangibles 14,206 4,657 1,188 2,392 1,824 2,677 1,467

All other assets 244,890 52,004 32,320 45,352 35,200 51,818 28,196

Total liabilities and capital 2,151,502 559,692 244,899 393,094 334,189 414,892 204,737

Deposits 1,762,652 446,704 202,453 324,081 272,528 345,980 170,905

 Domestic office deposits 1,762,431 446,533 202,448 324,064 272,528 345,980 170,878

 Foreign office deposits 221 171 5 17 0 0 28

 Brokered deposits 76,553 24,217 7,116 13,495 12,054 11,477 8,194

 Estimated insured deposits 1,316,400 320,315 152,442 258,083 215,013 252,720 117,828

Other borrowed funds 127,685 43,948 12,851 21,196 21,584 19,461 8,646

Subordinated debt 802 693 20 52 17 6 15

All other liabilities 17,543 5,798 1,867 3,144 2,158 2,783 1,793

Total equity capital (includes minority interests) 242,820 62,548 27,708 44,622 37,902 46,662 23,378

 Bank equity capital 242,708 62,498 27,695 44,594 37,901 46,644 23,377

Loans and leases 30-89 days past due 7,547 1,767 932 1,457 1,152 1,838 400

Noncurrent loans and leases 14,755 4,416 1,773 2,806 1,872 3,008 881

Restructured loans and leases 8,311 2,172 1,217 2,090 1,032 1,154 646

Mortgage-backed securities 178,728 51,765 20,126 32,202 21,515 34,215 18,906

Earning assets 2,001,297 523,790 225,971 364,960 311,441 383,812 191,324

FHLB Advances 100,344 37,553 10,337 15,497 15,859 15,436 5,663

Unused loan commitments 279,899 71,717 30,345 51,656 46,292 50,327 29,563

Trust assets 254,155 46,854 10,311 68,007 76,262 42,451 10,271

Assets securitized and sold 13,056 2,106 75 5,937 828 633 3,477

Notional amount of derivatives 74,052 26,690 8,848 13,118 9,716 9,007 6,673

INCOME DATA

Total interest income $20,045 $4,954 $2,337 $3,563 $3,203 $4,045 $1,943

Total interest expense 2,314 732 262 398 376 387 159

Net interest income 17,731 4,222 2,076 3,165 2,827 3,658 1,784

Provision for loan and lease losses 718 233 62 103 109 179 33

Total noninterest income 5,303 979 609 1,340 808 994 573

Total noninterest expense 15,150 3,451 1,882 2,994 2,322 3,052 1,450

Securities gains (losses) 189 52 21 25 38 39 13

Applicable income taxes 1,721 494 189 341 212 231 254

Extraordinary gains, net** -2 0 0 0 0 -2 0

Total net income (includes minority interests) 5,632 1,075 572 1,092 1,031 1,227 634

 Bank net income 5,625 1,074 570 1,090 1,031 1,226 634

Net charge-offs 564 244 53 85 57 123 2

Cash dividends 2,151 295 145 579 480 467 186

Retained earnings 3,473 779 426 511 551 758 448

Net operating income 5,483 1,036 556 1,071 999 1,196 625

* See Table V-A (page 11) for explanations.

** See Notes to Users (page 30) for explanation.
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 21

Table IV-B. Third Quarter 2016, FDIC-Insured Community Banks

Performance ratios (annualized, %)

All Community Banks Third Quarter 2016, Geographic Regions*

 3rd Quarter 

2016

2nd Quarter 

2016 New York Atlanta Chicago Kansas City Dallas San Francisco

Yield on earning assets 4.05 4.04 3.83 4.17 3.94 4.14 4.26 4.14

Cost of funding earning assets 0.47 0.46 0.57 0.47 0.44 0.49 0.41 0.34

Net interest margin 3.58 3.58 3.26 3.71 3.50 3.65 3.85 3.80

Noninterest income to assets 1.00 0.97 0.71 1.00 1.38 0.97 0.97 1.14

Noninterest expense to assets 2.85 2.86 2.49 3.10 3.08 2.80 2.97 2.88

Loan and lease loss provision to assets 0.13 0.14 0.17 0.10 0.11 0.13 0.17 0.06

Net operating income to assets 1.03 0.99 0.75 0.92 1.10 1.20 1.16 1.24

Pretax return on assets 1.38 1.34 1.13 1.25 1.47 1.50 1.42 1.77

Return on assets 1.06 1.02 0.78 0.94 1.12 1.24 1.19 1.26

Return on equity 9.36 9.06 6.96 8.30 9.84 10.96 10.63 10.97

Net charge-offs to loans and leases 0.15 0.13 0.24 0.13 0.13 0.10 0.18 0.01

Loan and lease loss provision to net charge-offs 127.28 157.28 95.36 117.96 121.30 190.30 145.07 1538.04

Efficiency ratio 65.38 66.26 66.01 69.73 65.84 63.44 65.37 61.21

Net interest income to operating revenue 76.98 77.50 81.18 77.32 70.26 77.77 78.63 75.67

% of unprofitable institutions 4.75 4.80 5.49 8.21 5.93 2.77 3.42 5.31

% of institutions with earnings gains 60.15 59.98 63.11 63.43 61.40 58.42 56.43 63.97

Table V-B. First Three Quarters 2016, FDIC-Insured Community Banks

Performance ratios (%)

All Community Banks First Three Quarters 2016, Geographic Regions*

First Three 

Quarters 2016

First Three 

Quarters 2015 New York Atlanta Chicago Kansas City Dallas San Francisco

Yield on earning assets 4.03 4.03 3.82 4.16 3.92 4.10 4.23 4.10

Cost of funding earning assets 0.46 0.46 0.56 0.46 0.44 0.48 0.40 0.33

Net interest margin 3.56 3.58 3.25 3.69 3.49 3.62 3.83 3.77

Noninterest income to assets 0.95 0.95 0.69 0.94 1.30 0.91 0.94 1.07

Noninterest expense to assets 2.83 2.91 2.50 3.08 3.05 2.76 2.96 2.88

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 0.99 0.97 0.74 0.87 1.06 1.16 1.14 1.14

Pretax return on assets 1.34 1.28 1.13 1.20 1.42 1.43 1.38 1.68

Return on assets 1.02 0.99 0.77 0.90 1.09 1.19 1.17 1.16

Return on equity 9.13 8.87 6.96 7.96 9.62 10.61 10.55 10.15

Net charge-offs to loans and leases 0.12 0.13 0.14 0.12 0.12 0.09 0.17 0.03

Loan and lease loss provision to net charge-offs 152.95 129.43 138.25 130.16 122.93 204.80 158.67 358.11

Efficiency ratio 66.10 67.72 66.58 70.40 66.77 64.07 65.87 62.42

Net interest income to operating revenue 77.75 77.69 81.54 78.30 71.37 78.73 79.06 76.71

% of unprofitable institutions 4.13 5.16 5.65 6.87 5.10 2.43 2.75 4.47

% of institutions with earnings gains 63.29 62.97 63.74 65.82 62.72 60.98 63.52 68.16

* See Table V-A (page 11) for explanations.
2 0 1 6  •Volume 1 0  • Number 4

22 FDIC QUARTERLY

Table VI-B. Loan Performance, FDIC-Insured Community Banks

September 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 0.47 0.39 0.54 0.57 0.45 0.59 0.24

Construction and development 0.40 0.26 0.39 0.40 0.60 0.43 0.33

Nonfarm nonresidential 0.32 0.30 0.33 0.42 0.34 0.35 0.14

Multifamily residential real estate 0.17 0.16 0.29 0.22 0.18 0.19 0.03

Home equity loans 0.42 0.41 0.41 0.46 0.33 0.53 0.36

Other 1-4 family residential 0.76 0.60 0.90 0.89 0.66 1.03 0.46

Commercial and industrial loans 0.49 0.39 0.48 0.39 0.57 0.70 0.40

Loans to individuals 1.47 1.74 1.64 0.93 1.03 2.22 0.82

Credit card loans 2.12 3.49 1.51 1.22 3.67 1.19 1.02

Other loans to individuals 1.45 1.72 1.64 0.92 0.89 2.24 0.80

All other loans and leases (including farm) 0.36 0.23 0.21 0.32 0.44 0.40 0.33

Total loans and leases 0.51 0.43 0.56 0.55 0.49 0.68 0.29

Percent of Loans Noncurrent**

All loans secured by real estate 0.97 1.03 1.13 1.14 0.79 0.94 0.60

Construction and development 1.15 1.06 1.95 1.12 1.10 0.88 0.92

Nonfarm nonresidential 0.86 0.89 0.90 1.08 0.88 0.82 0.45

Multifamily residential real estate 0.30 0.17 0.78 0.61 0.34 0.41 0.14

Home equity loans 0.65 0.75 0.52 0.71 0.28 0.67 0.67

Other 1-4 family residential 1.26 1.54 1.24 1.39 0.71 1.19 0.86

Commercial and industrial loans 1.27 1.29 0.85 1.05 1.01 2.00 0.95

Loans to individuals 0.77 0.69 0.85 0.39 0.49 1.52 0.33

Credit card loans 1.02 1.22 0.59 0.94 1.51 0.67 0.70

Other loans to individuals 0.76 0.68 0.86 0.37 0.43 1.54 0.30

All other loans and leases (including farm) 0.78 1.67 0.50 0.55 0.74 0.57 0.64

Total loans and leases 0.99 1.07 1.07 1.06 0.80 1.11 0.64

Percent of Loans Charged-Off (net, YTD)

All loans secured by real estate 0.04 0.05 0.07 0.07 0.02 0.03 -0.02

Construction and development 0.00 0.03 0.09 0.00 -0.03 -0.04 -0.10

Nonfarm nonresidential 0.04 0.04 0.04 0.08 0.02 0.05 -0.01

Multifamily residential real estate 0.01 0.01 0.10 0.00 0.04 -0.01 -0.01

Home equity loans 0.06 0.07 0.07 0.09 0.00 0.03 0.00

Other 1-4 family residential 0.06 0.06 0.09 0.10 0.03 0.05 -0.01

Commercial and industrial loans 0.33 0.53 0.25 0.22 0.18 0.47 0.07

Loans to individuals 0.76 0.65 0.84 0.57 0.91 0.92 0.65

Credit card loans 5.25 4.50 1.29 3.56 12.10 1.37 2.05

Other loans to individuals 0.62 0.60 0.83 0.46 0.30 0.91 0.56

All other loans and leases (including farm) 0.28 0.81 0.28 0.16 0.08 0.44 0.22

Total loans and leases 0.12 0.14 0.12 0.12 0.09 0.17 0.03

Loans Outstanding (in billions)

All loans secured by real estate $1,137.2 $340.3 $136.5 $200.5 $156.1 $197.1 $106.7

Construction and development 98.9 19.7 15.5 13.5 13.1 28.4 8.7

Nonfarm nonresidential 432.2 119.7 58.3 72.7 51.2 80.1 50.2

Multifamily residential real estate 102.5 54.9 6.2 15.2 8.1 7.4 10.7

Home equity loans 50.5 17.0 7.7 11.4 4.9 4.5 5.1

Other 1-4 family residential 386.4 127.2 44.7 71.7 50.1 64.2 28.6

Commercial and industrial loans 199.4 49.2 18.9 37.2 33.1 41.8 19.1

Loans to individuals 58.8 11.7 6.1 12.1 10.2 13.7 5.2

Credit card loans 1.9 0.2 0.1 0.4 0.5 0.3 0.3

Other loans to individuals 57.0 11.5 5.9 11.7 9.6 13.4 4.9

All other loans and leases (including farm) 92.5 12.6 4.6 15.4 34.5 18.7 6.7

Total loans and leases 1,488.0 413.8 166.1 265.2 233.9 271.3 137.6

Memo: Unfunded Commitments (in millions)

Total Unfunded Commitments 279,899 71,717 30,345 51,656 46,292 50,327 29,563

Construction and development: 1-4 family residential 24,199 4,894 4,310 2,734 3,008 6,598 2,654

Construction and development: CRE and other 57,459 17,372 6,994 8,852 6,892 12,623 4,726

Commercial and industrial 90,196 22,303 8,500 18,072 14,923 16,357 10,040

* 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 Grow by 2.1 Percent

DIF Reserve Ratio Rises 1 Basis Point to 1.18 Percent

Several Changes to Assessments Began in Third Quarter 2016

Total assets of the 5,980 FDIC-insured institutions increased by 1.4 percent ($232.6 billion) 

during the third quarter of 2016.1 Total deposits increased by 2.2 percent ($270.7 billion), 

domestic office deposits increased by 2.3 percent ($259.6 billion), and foreign office deposits increased by 0.8 percent ($11.2 billion). Domestic interest-bearing deposits increased 

by 1.7 percent ($140.1 billion), while noninterest-bearing deposits increased by 4 percent 

($119.5 billion). For the twelve months ending September 30, total domestic deposits grew 

by 7.6 percent ($811.7 billion), with interest-bearing deposits increasing by 8.2 percent 

($627.3 billion) and noninterest-bearing deposits increasing by 6.2 percent ($184.4 billion). 

Other borrowed money increased by 7.8 percent, securities sold under agreements to repurchase declined by 12.5 percent, and foreign office deposits declined by 0.2 percent over the 

same twelve-month period.2

Total estimated insured deposits increased by 2.1 percent in the third quarter of 2016.3 For 

institutions existing at the start and the end of the most recent quarter, insured deposits 

increased during the quarter at 3,588 institutions (60 percent), decreased at 2,371 institutions (40 percent), and remained unchanged at 30 institutions. Estimated insured deposits 

increased by 6.4 percent over the 12 months ending September 30, 2016.

The Deposit Insurance Fund (DIF) increased by $2.8 billion during the third quarter of 

2016 to $80.7 billion (unaudited). Assessment income of $2.6 billion and a negative provision for insurance losses of $566 million were the main drivers of the fund balance increase. 

Interest on investments and other miscellaneous income added another $174 million to the 

fund. Third quarter operating expenses and unrealized losses on available-for-sale securities 

reduced the fund balance by $589 million. Two insured institutions, with combined assets 

of $88 million, failed during the third quarter. The DIF’s reserve ratio (the fund balance 

as a percent of estimated insured deposits) was 1.18 percent on September 30, up from 

1.17 percent at June 30, 2016, and 1.09 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 September 30, 2016, by institution asset size category.

Changes in Assessments FDIC regulations provide that several changes to the assessment system are to take effect 

beginning the quarter after the DIF reserve ratio first reaches or exceeds 1.15 percent. The 

reserve ratio surpassed 1.15 percent and stood at 1.17 percent on June 30, 2016. Therefore, 

significant changes to deposit insurance assessments went into effect in the third quarter 

of 2016.

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 4

24 FDIC QUARTERLY

Decrease in Overall Assessment Rates

Overall initial assessment rates declined 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, FDIC estimates that regular assessments declined 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 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. FDIC estimates that assessment rates for approximately 93 percent of small banks have declined with the adoption of 

the new rate schedule.

Distribution of the Assessment Base for FDIC-Insured Institutions* 

by Asset Size

Data as of September 30, 2016

Asset Size Number of Institutions

Percent of 

Total Institutions

Assessment Base** 

($ Bil.) Percent of Base

Less Than $1 Billion 5,245 87.7 $1,111.7 7.8 

$1 - $10 Billion 621 10.4 1,536.9 10.7 

$10 - $50 Billion 74 1.2 1,482.5 10.4 

$50 - $100 Billion 12 0.2 741.2 5.2 

Over $100 Billion 28 0.5 9,449.7 66.0 

Total 5,980 100.0 14,322.0 100.0 

* 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

In March 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 DoddFrank 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.8,9 The rule prescribes that 

surcharges begin the quarter after the reserve ratio first reaches or surpasses 1.15 percent. 

Therefore, large banks were subject to quarterly surcharges in addition to lower regular 

risk-based assessments beginning in the third quarter of 2016. The surcharges amounted to 

$1.2 billion for the quarter.

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 is 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 4

26 FDIC QUARTERLY

DIF Reserve Ratios

Percent of Insured Deposits

0.89

1.01 1.03

1.07 1.09 1.11

1.17

0.68

0.79 0.80 0.84

1.13

1.18

9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16

Table I-C. Insurance Fund Balances and Selected Indicators

(dollar figures in millions)

Deposit Insurance Fund*

3rd 

Quarter 

2016

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

Beginning 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

Changes in Fund Balance:

Assessments earned 2,643 2,328 2,328 2,160 2,170 2,328 2,189 2,030 2,009 2,224 2,393 2,224 2,339

Interest earned on 

investment securities 171 164 147 128 122 113 60 70 80 87 45 23 34

Realized gain on sale of

investments 0 0 0 0 0 0 0 0 0 0 0 302 156

Operating expenses 422 441 415 447 410 434 396 408 406 428 422 436 298

Provision for insurance 

losses -566 -627 -43 -930 -578 -317 -426 -6,787 -1,663 -204 348 -4,588 -539

All other income, 

net of expenses 3 2 5 12 2 3 6 -43 6 6 9 9 46

Unrealized gain/(loss) on 

available-for-sale 

securities -167 110 412 -298 64 -34 231 24 -91 73 25 -277 71

Total fund balance change 2,794 2,790 2,520 2,485 2,526 2,293 2,516 8,460 3,261 2,166 1,702 6,433 2,887

Ending Fund Balance 80,704 77,910 75,120 72,600 70,115 67,589 65,296 62,780 54,320 51,059 48,893 47,191 40,758

Percent change from 

 four quarters earlier 15.10 15.27 15.05 15.64 29.08 32.37 33.55 33.03 33.27 34.82 36.79 43.19 61.58

Reserve Ratio (%) 1.18 1.17 1.13 1.11 1.09 1.07 1.03 1.01 0.89 0.84 0.80 0.79 0.68

Estimated Insured 

Deposits 6,822,885 6,680,805 6,669,911 6,528,125 6,414,381 6,341,745 6,341,501 6,201,915 6,133,019 6,101,961 6,111,983 5,999,191 5,962,294

Percent change from 

 four quarters earlier 6.37 5.35 5.18 5.26 4.59 3.93 3.76 3.38 2.86 2.60 1.95 -18.95 -17.75

Domestic Deposits 11,505,053 11,240,134 11,154,696 10,950,090 10,695,507 10,629,337 10,616,459 10,408,187 10,213,199 10,099,415 9,962,543 9,825,479 9,631,664

Percent change from 

 four quarters earlier 7.57 5.75 5.07 5.21 4.72 5.25 6.56 5.93 6.04 7.16 5.37 3.70 6.02

Assessment Base** 14,378,065 14,229,011 14,027,462 13,859,782 13,687,917 13,620,485 13,545,792 13,360,179 13,127,549 12,921,396 12,809,910 12,757,617 12,538,903

Percent change from 

 four quarters earlier 5.04 4.47 3.56 3.74 4.27 5.41 5.74 4.72 4.69 3.35 2.97 2.54 2.14

Number of Institutions 

Reporting 5,989 6,067 6,131 6,191 6,279 6,357 6,428 6,518 6,598 6,665 6,739 6,821 6,900

Deposit Insurance Fund Balance 

and Insured Deposits

($ Millions)

DIF 

Balance

DIF-Insured 

Deposits

9/13 $40,758 $5,962,294

12/13 47,191 5,999,191

3/14 48,893 6,111,983

6/14 51,059 6,101,961

9/14 54,320 6,133,019

12/14 62,780 6,201,915

3/15 65,296 6,341,501

6/15 67,589 6,341,745

9/15 70,115 6,414,381

12/15 72,600 6,528,125

3/16 75,120 6,669,911

6/16 77,910 6,680,805

9/16 80,704 6,822,885

Table II-C. Problem Institutions and Failed Institutions

(dollar figures in millions) 2016*** 2015*** 2015 2014 2013 2012 2011

Problem Institutions

Number of institutions 132 203 183 291 467 651 813

Total assets $24,917 $51,068 $46,780 $86,712 $152,687 $232,701 $319,432

Failed Institutions

Number of institutions 5 6 8 18 24 51 92

Total assets**** $277 $6,416 $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 September 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)

September 30, 2016

Number of 

Institutions

Total 

Assets

Domestic 

Deposits*

Est. Insured 

Deposits

Commercial Banks and Savings Institutions

FDIC-Insured Commercial Banks 5,170 $15,637,171 $10,569,531 $6,074,935

 FDIC-Supervised 3,437 2,421,085 1,909,493 1,338,324

 OCC-Supervised 948 10,678,615 6,913,612 3,817,396

 Federal Reserve-Supervised 785 2,537,472 1,746,426 919,215

FDIC-Insured Savings Institutions 810 1,129,436 891,240 715,715

 OCC-Supervised Savings Institutions 384 724,942 584,791 475,850

 FDIC-Supervised Savings Institutions 390 379,534 286,755 224,069

 Federal Reserve-Supervised 36 24,960 19,694 15,796

Total Commercial Banks and Savings Institutions 5,980 16,766,607 11,460,771 6,790,650

Other FDIC-Insured Institutions

U.S. Branches of Foreign Banks 9 93,651 44,281 32,235

Total FDIC-Insured Institutions 5,989 16,860,258 11,505,053 6,822,885

* 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 June 30, 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 1,616 26.64 $2,035.4 14.30

5.01-7.50 3,104 51.16 10,487.0 73.70

7.51-10.00 856 14.11 1,225.2 8.61

10.01-15.00 322 5.31 386.0 2.71

15.01-20.00 16 0.26 53.1 0.37

 20.01-25.00 127 2.09 36.5 0.26

 25.01-30.00 0 0.00 0.0 0.00

 30.01-35.00 25 0.41 5.7 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.
2 0 1 6  •Volume 1 0  • Number 4

28 FDIC QUARTERLY

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 VIII-A of the 

FDIC Quarterly Banking Profile is aggregated for all FDIC-insured 

Call report filers, both commercial banks and savings 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 example, 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, for example, 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.
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 29

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, 

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.
2 0 1 6  •Volume 1 0  • Number 4

30 FDIC QUARTERLY

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. [As a result of the recent accounting change, year-to-date 

Third Quarter 2016 “Extraordinary gains, net” on the QBP includes 

only Discontinued operations expense. Accordingly, comparisons 

to periods prior to September 2016 are not meaningful, since prior 

periods included all Extraordinary gains and Discontinued operations expense.] 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 
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 31

continue to be accounted for separately from goodwill, i.e., such 

existing intangible assets should not be combined with goodwill.

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). 
2 0 1 6  •Volume 1 0  • Number 4

32 FDIC QUARTERLY

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 

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 
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 33

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 changed to “average consolidated total assets minus 

average tangible equity” with an additional adjustment to the assessment base for banker’s banks and custodial banks, as permitted under 
2 0 1 6  •Volume 1 0  • Number 4

34 FDIC QUARTERLY

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.

Assessment rate schedule – Initial base assessment rates for small 

institutions are based on a combination of financial ratios and 

CAMELS component ratings. Initial rates for large institutions—

generally those with at least $10 billion in assets—are also based 

on CAMELS component ratings and certain 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). The FDIC may take 

additional information into account to make a limited adjustment to 

a large institution’s scorecard results, which are used to determine a 

large institution’s initial base assessment rate.

While risk categories for small institutions (except new institutions) were eliminated effective July 1, 2016, initial rates for small 

institutions are subject to minimums and maximums based on an 

institution’s CAMELS composite rating. (Risk categories for large 

institutions were eliminated in 2011.)

The current assessment rate schedule became effective July 1, 2016. 

Under the current schedule, initial base assessment rates range 

from 3 to 30 basis points. An institution’s total base assessment rate 

may differ from its initial rate due to three possible adjustments: 

(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 3 basis points would have a 

maximum unsecured debt adjustment of 1.5 basis points and could 

not have a total base assessment rate lower than 1.5 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 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.

The assessment rate schedule effective July 1, 2016, is shown in the 

following table:

Total Base Assessment Rates*

Established Small Banks Large and 

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

* 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.

 ** Effective July 1, 2016, large institutions are also subject to temporary 

assessment surcharges in order to raise the reserve ratio from 1.15 percent to 

1.35  percent. The surcharges amount to 4.5 basis points of a large institution’s 

assessment base (after making certain adjustments).

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.

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.
QUARTERLY BANKING PROFILE

FDIC QUARTERLY 35

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 

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, 
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36 FDIC QUARTERLY

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-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,” 

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.