Profits and balance sheet developments at U.S. commercial banks in 1997

William B. English and William R. Nelson

Federal Reserve Bulletin, 1998, vol. 84, issue Jun, 391-419

Abstract: U.S. commercial banks had another excellent year in 1997. Their return on equity remained in the elevated range that it has occupied for five consecutive years, and their return on assets reached a new high. Banks maintained their profitability while also adding significantly to assets. The year's strong economic growth increased the demand for credit; banks more than met that demand, gaining market share. In addition, banks departed from the pattern of recent years by sharply increasing their holdings of securities. Compared with 1996, banks earned a somewhat lower average rate on their interest-earning assets and paid a bit more on their liabilities, but these developments were more than offset by higher fee income and increased efficiency. Loan losses remained low relative to loans.

Keywords: Banks and banking - Accounting; Bank assets (search for similar items in EconPapers)
JEL-codes: G21 (search for similar items in EconPapers)
Date: 1998
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgrb:y:1998:i:jun:p:391-419:n:v.84no.6

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DOI: 10.17016/bulletin.1998.84-6

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