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Report on the condition of the U.S. banking industry: first quarter, 2004.

Assets at reporting bank holding companies rose $325 billion (or 3.7 percent) in the first quarter, primarily because the fifty large bank holding companies were active acquirers of investment securities during the period. (1) Aggregate securities and money market assets increased $260 billion, with nearly all of that increase occurring at the fifty large bank holding companies. Growth in investment securities at large institutions was associated with broader efforts, including derivatives transactions, intended to adjust interest rate sensitivity. The notional value of derivatives outstanding rose $6.3 trillion, or nearly 9 percent.

Loans grew only $75 billion, influenced by growth in holdings of mortgage loans but also by continuing softness in the commercial and industrial loan category. Unused commitments to lend grew more significantly ($100 billion, or 2.5 percent), with most of the growth occurring in credit cards and home equity lines of credit at large institutions.

Deposits grew $140 billion, a healthy 3 percent, but not sufficient to fund the quarter's asset growth. Accordingly, nondeposit borrowings rose $125 billion, or nearly 5 percent. Robust asset growth also contributed to a small decline in the total risk-based and leverage capital ratios, which nonetheless remain well above regulatory minimum standards.

Net income of reporting bank holding companies reached nearly $30 billion for the quarter, an increase of $1.6 billion from the fourth quarter of 2003. Stronger net interest income (fueled by asset growth) and lower provisions for loan losses provided much of the improvement, along with $2.0 billion in gains associated with the sale of investment securities. Nonperforming assets and net charge-offs continued their sustained decline--falling to roughly 1 per-cent of loans and 0.63 percent of average loans, respectively--allowing for the lower provisions. Non-interest income rose only modestly for the quarter as revenues generated by the origination and sale of new residential mortgage loans fell, influenced by earlier increases in mortgage interest rates and the corresponding slowdown in residential mortgage refinancings. However, market-sensitive revenues and fees from servicing existing mortgages provided some support.

More than one-third of the quarterly increase in net income was provided by other bank holding companies, as shown in table 3. Profits at these other (smaller) bank holding companies improved $0.6 billion, or 14 percent, in the first quarter after two quarters of declining earnings. Much of this improvement was attributable to dramatically lower provisions for loan losses--down nearly 30 percent, which in turn reflected seasonal influences more than it reflected the credit cycle. Provisions for loan losses declined a similar proportion in the first quarter of 2003.

(1.) The panel of fifty large bank holding companies has been updated on the basis of year-end 2003 data. Data contained in this report do not reflect administrative changes in the organizational structure of HSBC and its U.S. affiliates made during the first quarter of 2004. Therefore, these data do not reflect the ownership of House-hold International (total assets of about $140 billion) by HSBC's U.S. affiliates. These administrative changes will be fully incorporated into subsequent reports.
1. Financial characteristics of all reporting bank holding companies
in the United States

Millions of dollars except as noted, not seasonally adjusted

 Account or ratio (1),(2) 1999 2000 2001

Balance sheet

Total assets 6,223,385 6,716,552 7,448,060

Loans 3,383,994 3,703,287 3,804,665
Securities and money market 2,082,339 2,190,998 2,558,749
Allowance for loan losses -54,361 -58,811 -66,746
Other 811,413 881,078 1,151,392

Total liabilities 5,757,257 6,201,603 6,866,719

Deposits 3,499,625 3,754,638 4,005,863
Borrowings 1,776,050 1,983,017 2,061,127
Other (3) 481,583 463,948 799,729

Total equity 466,129 514,949 581,341

Off-balance-sheet
Unused commitments to lend (4) 3,093,729 3,297,511 3,481,744
Securitizations outstanding (5) n.a. n.a. 276,717
Derivatives (notional value,
 billions) (6) 37,924 43,599 48,261

Income statement
Net income (7) 76,961 72,557 65,488
 Net interest income 187,552 195,769 221,626
 Provisions for loan losses 20,071 26,874 39,522
 Non-interest income 174,461 197,724 214,093
 Non-interest expense 225,390 254,820 297,197
 Security gains or losses 3,117 -614 4,297

Ratios (percent)
Return on average equity 17.44 15.14 11.76
Return on average assets 1.30 1.12 .90
Net interest margin (8) 3.71 3.56 3.58
Efficiency ratio (7) 60.91 62.61 65.75
Nonperforming assets to loans
 and related assets .85 1.09 1.45
Net charge-offs to average loans .54 .65 .89
Loans to deposits 96.70 98.63 94.98

Regulatory capital ratios
Tier 1 risk-based 8.80 8.83 8.91
Total risk-based 11.73 11.80 11.91
Leverage 7.00 6.80 6.66

Number of reporting bank holding
 companies 1,647 1,727 1,842

 2002

 Account or ratio (1),(2) 2002 2003 Q3

Balance sheet

Total assets 7,941,074 8,819,602 7,787,276

Loans 4,044,385 4,393,737 3,912,145
Securities and money market 2,853,808 3,285,958 2,854,868
Allowance for loan losses -71,958 -72,217 -70,307
Other 1,114,840 1,212,124 1,090,570

Total liabilities 7,305,988 8,123,754 7,166,274

Deposits 4,332,313 4,674,254 4,162,946
Borrowings 2,228,020 2,610,397 2,264,667
Other (3) 745,655 839,103 738,661

Total equity 635,087 695,848 621,002

Off-balance-sheet
Unused commitments to lend (4) 3,650,670 4,097,529 3,610,928
Securitizations outstanding (5) 295,001 298,348 287,846
Derivatives (notional value,
 billions) (6) 57,864 72,870 55,464

Income statement
Net income (7) 84,678 106,603 21,535
 Net interest income 242,923 254,199 60,163
 Provisions for loan losses 42,928 31,535 11,150
 Non-interest income 215,879 245,080 53,645
 Non-interest expense 292,050 311,087 71,545
 Security gains or losses 4,503 5,764 1,772

Ratios (percent)
Return on average equity 14.05 16.23 14.18
Return on average assets 1.10 1.26 1.12
Net interest margin (8) 3.72 3.49 3.68
Efficiency ratio (7) 62.40 61.52 62.72
Nonperforming assets to loans
 and related assets 1.46 1.16 1.65
Net charge-offs to average loans 1.02 .81 1.08
Loans to deposits 93.35 94.00 93.98

Regulatory capital ratios
Tier 1 risk-based 9.21 9.55 9.33
Total risk-based 12.29 12.58 12.37
Leverage 6.70 6.84 6.79

Number of reporting bank holding
 companies 1,979 2,134 1,946

 2002 2003

 Account or ratio (1),(2) Q4 Q1 Q2

Balance sheet

Total assets 7,941,074 8,176,833 8,672,207

Loans 4,044,385 4,112,536 4,265,235
Securities and money market 2,853,808 3,007,215 3,214,738
Allowance for loan losses -71,958 -71,713 -72,001
Other 1,114,840 1,128,796 1,264,236

Total liabilities 7,305,988 7,527,389 7,998,682

Deposits 4,332,313 4,426,401 4,571,789
Borrowings 2,228,020 2,315,467 2,508,601
Other (3) 745,655 785,521 918,292

Total equity 635,087 649,444 673,525

Off-balance-sheet
Unused commitments to lend (4) 3,650,670 3,714,160 3,756,486
Securitizations outstanding (5) 295,001 284,429 285,286
Derivatives (notional value,
 billions) (6) 57,864 64,116 68,330

Income statement
Net income (7) 18,732 24,777 26,348
 Net interest income 61,700 62,279 63,168
 Provisions for loan losses 11,545 8,574 8,428
 Non-interest income 56,758 57,426 61,698
 Non-interest expense 79,033 74,222 77,554
 Security gains or losses 1,644 1,854 2,675

Ratios (percent)
Return on average equity 12.13 15.65 16.13
Return on average assets .94 1.22 1.25
Net interest margin (8) 3.63 3.58 3.50
Efficiency ratio (7) 65.65 62.01 62.59
Nonperforming assets to loans
 and related assets 1.46 1.43 1.34
Net charge-offs to average loans 1.02 .84 .80
Loans to deposits 93.35 92.91 93.29

Regulatory capital ratios
Tier 1 risk-based 9.21 9.33 9.29
Total risk-based 12.29 12.42 12.30
Leverage 6.70 6.72 6.75

Number of reporting bank holding
 companies 1,979 2,036 2,064

 2003 2004

 Account or ratio (1),(2) Q3 Q4 Q1

Balance sheet

Total assets 8,693,939 8,819,602 9,144,284

Loans 4,336,327 4,393,737 4,469,919
Securities and money market 3,172,498 3,285,958 3,544,192
Allowance for loan losses -71,413 -72,217 -71,474
Other 1,256,527 1,212,124 1,201,647

Total liabilities 8,013,405 8,123,754 8,425,004

Deposits 4,576,474 4,674,254 4,814,070
Borrowings 2,553,019 2,610,397 2,735,280
Other (3) 883,912 839,103 875,655

Total equity 680,534 695,848 719,280

Off-balance-sheet
Unused commitments to lend (4) 3,887,356 4,097,529 4,201,380
Securitizations outstanding (5) 290,328 298,348 293,705
Derivatives (notional value,
 billions) (6) 69,411 72,870 79,188

Income statement
Net income (7) 27,265 28,321 29,905
 Net interest income 63,899 65,038 66,367
 Provisions for loan losses 7,110 7,425 6,006
 Non-interest income 61,379 64,610 65,038
 Non-interest expense 78,017 81,360 81,457
 Security gains or losses 583 664 1,973

Ratios (percent)
Return on average equity 16.42 16.70 17.19
Return on average assets 1.26 1.29 1.33
Net interest margin (8) 3.43 3.46 3.42
Efficiency ratio (7) 62.20 62.39 62.17
Nonperforming assets to loans
 and related assets 1.24 1.16 1.04
Net charge-offs to average loans .75 .83 .63
Loans to deposits 94.75 94.00 92.85

Regulatory capital ratios
Tier 1 risk-based 9.51 9.55 9.55
Total risk-based 12.52 12.58 12.52
Leverage 6.74 6.84 6.83

Number of reporting bank holding
 companies 2,120 2,134 2,191

Footnotes appear on p. 327.

2. Financial characteristics of fifty large bank holding companies
in the United States

Millions of dollars except as noted, not seasonally adjusted

 Account or ratio (2),(9) 1999 2000 2001

Balance sheet

Total assets 5,044,007 5,415,534 5,771,881

Loans 2,638,594 2,869,704 2,882,304
Securities and money market 1,744,617 1,827,922 2,025,282
Allowance for loan losses -43,972 -47,022 -53,709
Other 704,768 764,930 918,005

Total liabilities 4,677,788 5,012,301 5,332,921

Deposits 2,627,896 2,788,209 2,959,554
Borrowings 1,596,140 1,788,955 1,843,867
Other (3) 453,752 435,138 529,501

Total equity 366,220 403,233 438,960

Off-balance-sheet
Unused commitments to lend (4) 2,866,318 3,061,455 3,223,389
Securitizations outstanding (5) n.a. n.a. 271,522
Derivatives (notional value,
 billions) (6) 37,876 43,521 48,130

Income statement
Net income (7) 63,918 59,154 50,885
 Net interest income 145,090 149,712 161,777
 Provisions for loan losses 17,050 22,980 34,231
 Non-interest income 155,301 177,094 168,028
 Non-interest expense 186,077 211,635 217,391
 Security gains or losses 2,224 -611 4,229

Ratios (percent)
Return on average equity 18.61 15.81 12.09
Return on average assets 1.33 1.13 .90
Net interest margin (8) 3.58 3.42 3.35
Efficiency ratio (7) 60.46 62.51 63.03
Nonperforming assets to loans
 and related assets .90 1.19 1.59
Net charge-offs to average loans .61 .74 1.02
Loans to deposits 100.41 102.92 97.39

Regulatory capital ratios
Tier 1 risk-based 8.09 8.17 8.19
Total risk-based 11.32 11.45 11.56
Leverage 6.61 6.40 6.20

 2002

 Account or ratio (2),(9) 2002 2003 Q3

Balance sheet

Total assets 6,113,304 6,754,540 6,003,515

Loans 3,052,011 3,289,320 2,938,492
Securities and money market 2,249,617 2,589,207 2,267,847
Allowance for loan losses -57,499 -56,862 -56,209
Other 869,175 932,875 853,385

Total liabilities 5,638,416 6,238,516 5,539,009

Deposits 3,186,709 3,427,557 3,044,933
Borrowings 2,001,008 2,314,793 2,040,619
Other (3) 450,699 496,166 453,456

Total equity 474,889 516,024 464,506

Off-balance-sheet
Unused commitments to lend (4) 3,368,731 3,781,780 3,330,997
Securitizations outstanding (5) 289,125 292,178 282,997
Derivatives (notional value,
 billions) (6) 57,731 72,663 55,315

Income statement
Net income (7) 66,424 85,402 16,779
 Net interest income 178,377 186,654 43,504
 Provisions for loan losses 36,912 26,710 9,649
 Non-interest income 165,358 188,222 41,425
 Non-interest expense 208,612 221,559 51,005
 Security gains or losses 4,863 5,122 1,951

Ratios (percent)
Return on average equity 14.64 17.49 14.71
Return on average assets 1.12 1.31 1.13
Net interest margin (8) 3.53 3.33 3.44
Efficiency ratio (7) 59.49 58.35 60.21
Nonperforming assets to loans
 and related assets 1.59 1.24 1.84
Net charge-offs to average loans 1.18 .94 1.28
Loans to deposits 95.77 95.97 96.50

Regulatory capital ratios
Tier 1 risk-based 8.47 8.74 8.63
Total risk-based 11.94 12.14 12.09
Leverage 6.20 6.29 6.32

 2002 2003

 Account or ratio (2),(9) Q4 Q1 Q2

Balance sheet

Total assets 6,113,304 6,283,387 6,670,009

Loans 3,052,011 3,099,399 3,204,451
Securities and money market 2,249,617 2,362,594 2,527,960
Allowance for loan losses -57,499 -56,839 -56,748
Other 869,175 878,234 994,346

Total liabilities 5,638,416 5,799,916 6,170,671

Deposits 3,186,709 3,244,626 3,359,696
Borrowings 2,001,008 2,075,842 2,225,926
Other (3) 450,699 479,448 585,050

Total equity 474,889 483,472 499,338

Off-balance-sheet
Unused commitments to lend (4) 3,368,731 3,420,124 3,451,764
Securitizations outstanding (5) 289,125 278,455 278,920
Derivatives (notional value,
 billions) (6) 57,731 63,959 68,144

Income statement
Net income (7) 14,247 19,688 20,863
 Net interest income 45,830 45,721 46,238
 Provisions for loan losses 9,822 7,430 7,140
 Non-interest income 42,421 44,170 47,292
 Non-interest expense 56,518 52,831 55,210
 Security gains or losses 1,753 1,727 2,308

Ratios (percent)
Return on average equity 12.33 16.68 17.24
Return on average assets .93 1.26 1.29
Net interest margin (8) 3.48 3.41 3.32
Efficiency ratio (7) 62.85 59.07 59.46
Nonperforming assets to loans
 and related assets 1.59 1.52 1.42
Net charge-offs to average loans 1.18 1.01 .94
Loans to deposits 95.77 95.52 95.38

Regulatory capital ratios
Tier 1 risk-based 8.47 8.57 8.50
Total risk-based 11.94 12.05 11.89
Leverage 6.20 6.21 6.23

 2003 2004

 Account or ratio (2),(9) Q3 Q4 Q1

Balance sheet

Total assets 6,682,600 6,754,540 7,045,844

Loans 3,258,498 3,289,320 3,347,029
Securities and money market 2,493,425 2,589,207 2,832,561
Allowance for loan losses -55,951 -56,862 -55,742
Other 986,628 932,875 921,996

Total liabilities 6,176,065 6,238,516 6,511,119

Deposits 3,353,369 3,427,557 3,543,238
Borrowings 2,271,690 2,314,793 2,451,353
Other (3) 551,006 496,166 516,528

Total equity 506,535 516,024 534,726

Off-balance-sheet
Unused commitments to lend (4) 3,574,976 3,781,780 3,878,766
Securitizations outstanding (5) 283,990 292,178 289,460
Derivatives (notional value,
 billions) (6) 69,220 72,663 78,941

Income statement
Net income (7) 21,969 22,990 24,124
 Net interest income 47,170 47,710 48,895
 Provisions for loan losses 5,874 6,266 5,175
 Non-interest income 47,221 49,571 50,649
 Non-interest expense 55,983 57,601 58,579
 Security gains or losses 469 631 1,585

Ratios (percent)
Return on average equity 17.78 18.22 18.61
Return on average assets 1.31 1.37 1.39
Net interest margin (8) 3.28 3.31 3.26
Efficiency ratio (7) 59.24 58.80 59.23
Nonperforming assets to loans
 and related assets 1.31 1.24 1.08
Net charge-offs to average loans .86 .94 .76
Loans to deposits 97.17 95.97 94.46

Regulatory capital ratios
Tier 1 risk-based 8.76 8.74 8.74
Total risk-based 12.14 12.14 12.06
Leverage 6.23 6.29 6.27

Footnotes appear on p. 327.

3. Financial characteristics of all other reporting bank holding
companies in the United States

Millions of dollars except as noted, not seasonally adjusted

 Account (1),(10) 1999 2000 2001

Balance sheet

Total assets 1,150,598 1,267,495 1,374,372

Loans 734,118 820,595 874,164
Securities and money market 321,785 344,394 382,380
Allowance for loan losses -10,212 -11,580 -12,697
Other 104,907 114,086 130,525

Total liabilities 1,052,605 1,157,787 1,252,341

Deposits 871,728 966,346 1,040,061
Borrowings 158,337 164,375 183,790
Other (3) 22,540 27,066 28,491

Total equity 97,994 109,708 122,031

Off-balance-sheet
Unused commitments to lend (4) 216,083 227,707 248,671
Securitizations outstanding (5) n.a. n.a. 4,871
Derivatives (notional value,
 billions) (6) 35 65 102

Income statement
Net income (7) 12,895 13,383 14,546
 Net interest income 42,379 46,063 48,534
 Provisions for loan losses 2,927 3,751 4,856
 Non-interest income 17,359 18,696 23,897
 Non-interest expense 37,797 41,444 46,689
 Security gains or losses 825 -9 777

Ratios (percent)
Return on average equity 13.26 12.99 12.32
Return on average assets 1.16 1.11 1.11
Net interest margin (8) 4.27 4.24 4.12
Efficiency ratio (7) 62.47 62.35 63.53
Nonperforming assets to loans
 and related assets .69 .76 .97
Net charge-offs to average loans .30 .32 .44
Loans to deposits 84.21 84.92 84.05

Regulatory capital ratios
Tier 1 risk-based 12.24 11.90 12.16
Total risk-based 13.71 13.39 13.79
Leverage 8.65 8.57 8.74

Number of other reporting bank
 holding companies 1,570 1,663 1,788

 2002

 Account (1),(10) 2002 2003 Q3

Balance sheet

Total assets 1,510,055 1,654,954 1,474,065

Loans 945,177 1,033,891 925,905
Securities and money market 435,754 480,900 424,233
Allowance for loan losses -14,047 -14,964 -13,759
Other 143,171 155,128 137,686

Total liabilities 1,372,425 1,504,937 1,338,734

Deposits 1,136,674 1,234,440 1,111,248
Borrowings 201,571 232,986 193,152
Other (3) 34,179 37,510 34,333

Total equity 137,630 150,017 135,332

Off-balance-sheet
Unused commitments to lend (4) 270,590 303,309 268,346
Securitizations outstanding (5) 5,137 5,026 4,398
Derivatives (notional value,
 billions) (6) 101 110 120

Income statement
Net income (7) 17,586 18,929 4,576
 Net interest income 53,713 55,847 13,796
 Provisions for loan losses 5,386 4,609 1,424
 Non-interest income 26,230 29,671 6,633
 Non-interest expense 49,510 54,195 12,391
 Security gains or losses 722 1,074 261

Ratios (percent)
Return on average equity 13.60 13.15 13.86
Return on average assets 1.24 1.20 1.27
Net interest margin (8) 4.21 3.94 4.31
Efficiency ratio (7) 60.91 62.59 60.31
Nonperforming assets to loans
 and related assets 1.02 .97 1.03
Net charge-offs to average loans .47 .40 .46
Loans to deposits 83.15 83.75 83.32

Regulatory capital ratios
Tier 1 risk-based 12.39 12.53 12.50
Total risk-based 14.06 14.27 14.15
Leverage 8.86 9.00 8.97

Number of other reporting bank
 holding companies 1,925 2,080 1,892

 2002 2003

 Account (1),(10) Q4 Q1 Q2

Balance sheet

Total assets 1,510,055 1,560,906 1,610,240

Loans 945,177 964,523 993,042
Securities and money market 435,754 466,110 480,658
Allowance for loan losses -14,047 -14,458 -14,746
Other 143,171 144,731 151,287

Total liabilities 1,372,425 1,418,270 1,463,155

Deposits 1,136,674 1,172,534 1,201,071
Borrowings 201,571 208,955 223,476
Other (3) 34,179 36,781 38,607

Total equity 137,630 142,636 147,085

Off-balance-sheet
Unused commitments to lend (4) 270,590 282,775 293,012
Securitizations outstanding (5) 5,137 5,172 5,368
Derivatives (notional value,
 billions) (6) 101 113 119

Income statement
Net income (7) 4,297 4,714 4,928
 Net interest income 13,531 13,775 13,966
 Provisions for loan losses 1,519 1,077 1,199
 Non-interest income 7,031 7,084 7,791
 Non-interest expense 13,037 13,010 13,651
 Security gains or losses 188 302 432

Ratios (percent)
Return on average equity 12.72 13.46 13.69
Return on average assets 1.16 1.24 1.25
Net interest margin (8) 4.08 4.03 3.97
Efficiency ratio (7) 63.13 61.72 63.42
Nonperforming assets to loans
 and related assets 1.02 1.13 1.08
Net charge-offs to average loans .53 .32 .39
Loans to deposits 83.15 82.26 82.68

Regulatory capital ratios
Tier 1 risk-based 12.39 12.55 12.49
Total risk-based 14.06 14.24 14.21
Leverage 8.86 8.95 8.91

Number of other reporting bank
 holding companies 1,925 1,982 2,010

 2003 2004

 Account (1),(10) Q3 Q4 Q1

Balance sheet

Total assets 1,619,654 1,654,954 1,678,459

Loans 1,008,162 1,033,891 1,052,311
Securities and money market 474,675 480,900 489,879
Allowance for loan losses -15,003 -14,964 -15,347
Other 151,820 155,128 151,616

Total liabilities 1,472,908 1,504,937 1,525,064

Deposits 1,211,527 1,234,440 1,256,851
Borrowings 224,492 232,986 224,877
Other (3) 36,889 37,510 43,336

Total equity 146,746 150,017 153,395

Off-balance-sheet
Unused commitments to lend (4) 300,237 303,309 309,232
Securitizations outstanding (5) 5,260 5,026 3,121
Derivatives (notional value,
 billions) (6) 114 110 137

Income statement
Net income (7) 4,825 4,462 5,088
 Net interest income 13,873 14,233 14,456
 Provisions for loan losses 1,116 1,218 866
 Non-interest income 7,447 7,349 7,221
 Non-interest expense 13,389 14,145 13,772
 Security gains or losses 140 201 328

Ratios (percent)
Return on average equity 13.42 12.08 13.59
Return on average assets 1.21 1.09 1.23
Net interest margin (8) 3.87 3.89 3.92
Efficiency ratio (7) 62.56 65.45 62.84
Nonperforming assets to loans
 and related assets 1.02 .97 .96
Net charge-offs to average loans .36 .52 .24
Loans to deposits 83.21 83.75 83.73

Regulatory capital ratios
Tier 1 risk-based 12.51 12.53 12.51
Total risk-based 14.25 14.27 14.24
Leverage 8.92 9.00 9.06

Number of other reporting bank
 holding companies 2,066 2,080 2,137

Footnotes appear on p. 327.

4. Nonfinancial characteristics of all reporting bank holding
companies in the United States

Millions of dollars except as noted, not seasonally adjusted

 Account 1999 2000 2001

Bank holding companies that
 qualify as financial holding
 companies (11),(12)
Domestic
 Number n.a. 299 388
 Total assets n.a. 4,494,270 5,436,785
Foreign-owned (13)
 Number n.a. 9 10
 Total assets n.a. 502,506 621,442

Total U.S. commercial bank
 assets (14) 5,673,702 6,129,534 6,415,909

 By ownership
 Reporting bank holding
 companies 5,226,027 5,657,210 5,942,575
 Other bank holding companies 226,916 229,274 230,464
 Independent banks 220,759 243,050 242,870

Assets associated with nonbanking
 activities (12),(15)
Insurance n.a. n.a. 426,462
Securities broker--dealers n.a. n.a. n.a.
Thrift institutions 117,699 102,218 91,170
Foreign nonbank institutions 78,712 132,629 138,977
Other nonbank institutions 879,793 1,234,714 1,674,267

Number of bank holding companies
 engaged in nonbanking
 activities (12),(15)
Insurance n.a. n.a. 143
Securities broker--dealers n.a. n.a. n.a.
Thrift institutions 57 50 38
Foreign nonbank institutions 25 25 32
Other nonbank institutions 559 633 743

Foreign-owned bank holding
 companies (13)
Number 18 21 23
Total assets 535,024 636,669 764,411

Employees of reporting bank
 holding companies
 (full-time equivalent) 1,775,418 1,859,930 1,985,981

Assets of fifty large bank
 holding companies (9),(17)
Fixed panel (from table 2) 5,044,007 5,415,534 5,771,881
Fifty large as of reporting date 4,809,785 5,319,129 5,732,621
Percent of all reporting
 bank holding companies 77.30 79.20 77.00

 2002

 Account 2002 2003 Q3

Bank holding companies that
 qualify as financial holding
 companies (11),(12)
Domestic
 Number 434 451 415
 Total assets 5,916,859 6,605,638 5,706,966
Foreign-owned (13)
 Number 11 12 11
 Total assets 616,254 710,441 689,804

Total U.S. commercial bank
 assets (14) 6,897,447 7,397,878 6,762,780

 By ownership
 Reporting bank holding
 companies 6,429,738 6,941,083 6,296,385
 Other bank holding companies 227,017 219,223 226,602
 Independent banks 240,692 237,572 239,793

Assets associated with nonbanking
 activities (12),(15)
Insurance 350,633 411,926 338,384
Securities broker--dealers 630,851 656,775 703,738
Thrift institutions 107,422 133,056 56,063
Foreign nonbank institutions 145,344 170,600 144,814
Other nonbank institutions 561,712 686,423 493,777

Number of bank holding companies
 engaged in nonbanking
 activities (12),(15)
Insurance 86 101 91
Securities broker--dealers 47 50 47
Thrift institutions 32 27 37
Foreign nonbank institutions 37 41 38
Other nonbank institutions 880 1,043 835

Foreign-owned bank holding
 companies (13)
Number 26 28 24
Total assets 762,901 934,781 827,867

Employees of reporting bank
 holding companies
 (full-time equivalent) 1,992,559 2,034,358 1,979,260

Assets of fifty large bank
 holding companies (9),(17)
Fixed panel (from table 2) 6,113,304 6,754,540 6,003,515
Fifty large as of reporting date 6,032,000 6,666,488 5,951,115
Percent of all reporting
 bank holding companies 76.00 75.60 76.40

 2002 2003

 Account Q4 Q1 Q2

Bank holding companies that
 qualify as financial holding
 companies (11),(12)
Domestic
 Number 434 437 440
 Total assets 5,916,859 6,061,696 6,433,736
Foreign-owned (13)
 Number 11 11 11
 Total assets 616,254 648,017 732,695

Total U.S. commercial bank
 assets (14) 6,897,447 7,031,274 7,325,357

 By ownership
 Reporting bank holding
 companies 6,429,738 6,577,712 6,863,188
 Other bank holding companies 227,017 222,670 222,997
 Independent banks 240,692 230,893 239,172

Assets associated with nonbanking
 activities (12),(15)
Insurance 350,633 359,968 383,999
Securities broker--dealers 630,851 709,839 659,701
Thrift institutions 107,422 126,375 124,640
Foreign nonbank institutions 145,344 154,812 160,515
Other nonbank institutions 561,712 524,709 737,434

Number of bank holding companies
 engaged in nonbanking
 activities (12),(15)
Insurance 86 90 91
Securities broker--dealers 47 48 50
Thrift institutions 32 31 31
Foreign nonbank institutions 37 38 40
Other nonbank institutions 880 913 945

Foreign-owned bank holding
 companies (13)
Number 26 26 27
Total assets 762,901 799,540 946,847

Employees of reporting bank
 holding companies
 (full-time equivalent) 1,992,559 2,000,168 2,019,953

Assets of fifty large bank
 holding companies (9),(17)
Fixed panel (from table 2) 6,113,304 6,283,387 6,670,009
Fifty large as of reporting date 6,032,000 6,203,000 6,587,000
Percent of all reporting
 bank holding companies 76.00 75.90 76.00

 2003 2004

 Account Q3 Q4 Q1

Bank holding companies that
 qualify as financial holding
 companies (11),(12)
Domestic
 Number 448 451 462
 Total assets 6,447,130 6,605,638 6,839,802
Foreign-owned (13)
 Number 11 12 13
 Total assets 729,244 710,441 856,185

Total U.S. commercial bank
 assets (14) 7,293,984 7,397,878 7,614,338

 By ownership
 Reporting bank holding
 companies 6,842,825 6,941,083 7,165,394
 Other bank holding companies 217,036 219,223 213,356
 Independent banks 234,122 237,572 235,589

Assets associated with nonbanking
 activities (12),(15)
Insurance 398,378 411,926 428,085
Securities broker--dealers 686,049 656,775 713,794
Thrift institutions 143,578 133,056 139,713
Foreign nonbank institutions 162,789 170,600 195,472
Other nonbank institutions 736,515 686,423 698,281

Number of bank holding companies
 engaged in nonbanking
 activities (12),(15)
Insurance 100 101 99
Securities broker--dealers 46 50 49
Thrift institutions 29 27 29
Foreign nonbank institutions 39 41 41
Other nonbank institutions 992 1,043 1,031

Foreign-owned bank holding
 companies (13)
Number 28 28 28
Total assets 947,932 934,781 1,007,694

Employees of reporting bank
 holding companies
 (full-time equivalent) 2,031,029 2,034,358 2,099,709

Assets of fifty large bank
 holding companies (9),(17)
Fixed panel (from table 2) 6,682,600 6,754,540 7,045,844
Fifty large as of reporting date 6,602,255 6,666,488 7,045,844
Percent of all reporting
 bank holding companies 75.90 75.60 77.10

NOTE. All data are as of the most recent period shown. The historical
figures may not match those in earlier versions of this table because
of mergers, significant acquisitions or divestitures, or revisions or
restatements to bank holding company financial reports. Data for the
most recent period may not include all late-filing institutions.

(1.) Covers top-tier bank holding companies except (1) those with
consolidated assets of less than $150 million and with only one
subsidiary bank and (2) multibank holding companies with consolidated
assets of less than $150 million, with no debt outstanding to the
general public and not engaged in certain nonbanking activities.

(2.) Data for all reporting bank holding companies and the fifty large
bank holding companies reflect merger adjustments to the fifty large
bank holding companies. Merger adjustments account for mergers,
acquisitions, other business combinations and large divestitures that
occurred during the time period covered in the tables so that the
historical information on each of the fifty underlying institutions
depicts, to the greatest extent possible, the institutions as they
exist in the most recent period. In general, adjustments for mergers
among bank holding companies reflect the combination of historical data
from predecessor bank holding companies.

The data for the fifty large bank holding companies have also been
adjusted as necessary to match the historical figures in each company's
most recently available financial statement.

In general, the data are not adjusted for changes in generally accepted
accounting principles.

(3.) Includes minority interests in consolidated subsidiaries.

(4.) Includes credit card lines of credit as well as commercial lines
of credit.

(5.) Includes loans sold to securitization vehicles in which bank
holding companies retain some interest, whether through recourse or
seller-provided credit enhancements or by servicing the underlying
assets. Securitization data were first collected on the FR Y-9C report
for June 2001.

(6.) The notional value of a derivative is the reference amount of an
asset on which an interest rate or price differential is calculated.
The total notional value of a bank holding company's derivatives
holdings is the sum of the notional values of each derivative contract
regardless of whether the bank holding company is a payor or recipient
of payments under the contract. The actual cash flows and fair market
values associated with these derivative contracts are generally only a
small fraction of the contract's notional value.

(7.) Income statement subtotals for all reporting bank holding
companies and the fifty large bank holding companies exclude
extraordinary items, the cumulative effects of changes in accounting
principles, and discontinued operations at the fifty large institutions
and therefore will not sum to Net income. The efficiency ratio is
calculated excluding nonrecurring income and expenses.

(8.) Calculated on a fully-taxable-equivalent basis.

(9.) In general, the fifty large bank holding companies are the fifty
largest bank holding companies as measured by total consolidated
assets for the latest period shown. Excludes a few large bank holding
companies whose commercial banking operations account for only a
small portion of assets and earnings.

(10.) Excludes predecessor bank holding companies that were
subsequently merged into other bank holding companies in the panel of
fifty large bank holding companies. Also excludes those bank holding
companies excluded from the panel of fifty large bank holding companies
because commercial banking operations represent only a small part of
their consolidated operations.

(11.) Exclude qualifying institutions that are not reporting bank
holding companies.

(12.) No data related to financial holding companies and only some data
on nonbanking activities were collected on the FR Y-9C report before
implementation of the Gramm--Leach--Bliley Act in 2000.

(13.) A bank holding company is considered "foreign-owned" if
it is majority-owned by a foreign entity. Data for foreign-owned
companies do not include data for branches and agencies of foreign
banks operating in the United States.

(14.) Total assets of insured commercial banks in the United States as
reported in the commercial bank Call Report (FFIEC 031 or 041, Reports
of Condition and Income). Excludes data for a small number of
commercial banks owned by other commercial banks that file separate call
reports yet are also covered by the reports filed by their parent banks.
Also excludes data for mutual savings banks.

(15.) Data for thrift, foreign nonbank, and other nonbank institutions
are total assets of each type of subsidiary as reported in the FR Y-9LP
report. Data cover those subsidiaries in which the top-tier bank
holding company directly or indirectly owns or controls more than 50
percent of the outstanding voting stock and that has been consolidated
using generally accepted accounting principles. Data for securities
broker--dealers are net assets (that is, total assets, excluding
intercompany transactions) of broker--dealer subsidiaries engaged in
activities pursuant to the Gramm--Leach--Bliley Act, as reported on
schedule HC-M of the FR Y-9C report. Data for insurance activities are
all insurance-related assets held by the bank holding company as
reported on schedule HC-I of the FR Y-9C report.

Beginning in 2002:Q1, insurance totals exclude intercompany
transactions and subsidiaries engaged in credit-related insurance or
those engaged principally in insurance agency activities. Beginning in
2002:Q2, insurance totals include only newly authorized insurance
activities under the Gramm--Leach--Bliley Act.

(16.) Aggregate assets of thrift subsidiaries were affected
significantly by the conversion of Charter One's thrift subsidiary
(with assets of $37 billion) to a commercial bank in the second quarter
of 2002 and the acquisition by Citigroup of Golden State Bancorp
(a thrift institution with assets of $55 billion) in the fourth
quarter of 2002.

(17.) Changes over time in the total assets of the time-varying panel
of fifty large bank holding companies are attributable to (1) changes
in the companies that make up the panel and (2) to a small extent,
restatements of financial reports between periods.

n.a. Not available

SOURCE. Federal Reserve Reports FRY-9C and FR Y-9LP, Federal Reserve
National Information Center, and published financial reports.
COPYRIGHT 2004 Board of Governors of the Federal Reserve System
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2004, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Publication:Federal Reserve Bulletin
Date:Jun 22, 2004
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