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Bankers expect higher profits but slow business recovery.

A nationwide survey of 600 commercial bank chief executive officers conducted by Grant Thornton found a majority look for higher 1992 profits for their own institutions but anticipate sluggish business conditions throughout the second half of this year.

In releasing the results of the survey, Grant Thornton partner Norman Katz said, "Bankers in all parts of the country still seem quite pessimistic about the strength and pace of economic recovery. This is a troubling discovery, considering it comes from those who control America's purse strings."

Of the bank CEOs polled, 52% believe the U.S. economy is still in a recession, while 43% think a recovery has just begun. When asked to describe their own market areas, 43% of the CEOs said they were still in a recession, and 29% said they were just entering a recovery.

The bankers were pessimistic about the chances of a recovery in the economy this year. When asked when the economy will come out of the recession, 45% said by the third or fourth quarter of this year, but another 46% said after yearend.

Despite the gloomy outlook for business in general, 58% of the CEOs expect their 1992 earnings to be higher than 1991 levels; 19% anticipate a gain of 20% or more. Another 30% look for current-year earnings to match 1991 levels.
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Title Annotation:Grant Thornton survey
Publication:Journal of Accountancy
Article Type:Brief Article
Date:Jun 1, 1992
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