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MICHIGAN BANKS CONTINUE TO BE SAFE AND SOUND

 MICHIGAN BANKS CONTINUE TO BE SAFE AND SOUND
 LANSING, Mich., Nov. 4 /PRNewswire/ -- Michigan's commercial banks


continued to perform in an outstanding manner during the first half of 1991, according to a study of the official Call Reports which were filed with federal banking regulators by all 230 Michigan banks and made available to the public in mid-October. The study was conducted for the Michigan Bankers Association by Bank Analyzer Reports, Inc., a Detroit- area publisher of comparative bank data.
 David M. Ondersma, chairman, president and chief executive officer of First Michigan Bank Corporation in Holland and president of the Michigan Bankers Association, commented, "We have been saying for some time that Michigan's banks are among the safest, soundest and most profitable in the entire nation. Now, once again, an analysis of facts on the public record proves our point. Michigan consumers, business organizations and government bodies can continue to do business with their local banks and rest assured that their deposits are as safe as they have ever been. The problems of banks in other regions of the country have not surfaced here and, quite frankly, we don't expect that they ever will."
 During the first six months of 1991, Michigan banks earned $4.7 billion, an annualized return on their assets of .95 percent. The state's banks held total assets of more than $95 billion at mid-year. The banking industry's "standard of excellence" is an annual return on assets of 1 percent.
 At the end of June, the average capital-to-asset ratio among Michigan banks (including loan loss reserves) was 9.23 percent. Federal regulators normally consider a ratio of 6 percent to be satisfactory.
 Asset quality at Michigan banks remains excellent. At June 30, 1991, non-performing loans constituted just 1.61 percent of total loans. A loan portfolio is considered to be of very good quality as long as no more than 2 percent of loans are non-performing.
 Just seven Michigan banks reported losses for the first half of 1991. Four of them are affiliates of large, profitable bank holding companies, two are independent banks that experienced unusual situations which caused non-recurring losses, and the seventh was forced to take a large loss on its investments and has been sold to a larger bank.
 The following chart indicates the performance of Michigan banks during the first half of 1991 by size groups.
 MICHIGAN BANKERS ASSOCIATION
 MICHIGAN BANK PERFORMANCE, 1ST HALF, 1991
 Non-Performing
 Bank Return on Return on Equity to Loans/
 Size Group Avg. Equity Avg. Assets Assets Ratio Total Loans
 (Percent) (Percent) (Percent) (Percent)
 Under $50 million
 (64) 8.39 0.79 10.56 1.96
 $50-$250 million
 (125) 12.25 0.96 8.97 1.50
 $250 million-
 $1 billion (30) 17.44 1.20 8.00 1.32
 $1-$5 billion (7) 17.85 1.30 8.10 1.37
 Over $5 billion (4) 14.99 0.88 7.29 2.01
 All Michigan
 banks (230) 12.04 0.95 9.23 1.61
 -0- 11/4/91
 /CONTACT: David M. Ondersma, 616-396-9000, Donald A. Booth, 517-485-3600, or Justin L. Moran, 313-884-6800, all of Michigan Bankers Association/ CO: Michigan Bankers Association ST: Michigan IN: FIN SU: ECO SB-ML -- DE013 -- 0643 11/04/91 10:25 EST
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Date:Nov 4, 1991
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