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

Assets of reporting bank holding companies rose $365 billion (3.9 percent) in the second quarter, to $9.65 trillion. Loans accounted for the majority of this overall growth (up $194 billion, or 4.3 percent). Loan growth was primarily in consumer categories, while commercial lending activity remained weak. Reflecting this weakness in business loans, unused commitments to lend grew only $70 billion, or one-third of the growth seen in each of the two previous quarters. The increase in total assets was significantly influenced by the addition of a new insurance-oriented financial holding company (John Hancock) with consolidated assets of $115 billion, mostly in other assets.

Even with the addition of the new insurance-oriented financial holding company, securities and money market assets rose only $41 billion, or 1.1 percent. The overall growth masked significant differences across the population of reporting bank holding companies. Holdings of these assets declined $16 billion, or 0.6 percent, at the fifty large bank holding companies as these institutions sought to position their balance sheets for possible future interest rate increases. In contrast, such assets rose slightly at the generally smaller "all other reporting companies" and more significantly at the few large bank holding companies excluded from the "fifty large" panel, because commercial banking operations account for only a small portion of their assets and earnings.

Deposits grew strongly (up $165 billion, or 3.4 percent), attributable in part to continued healthy increases in core deposits. Borrowings rose at a slower pace ($55 billion, or 1.9 percent). The remarkable growth in other assets and other liabilities--10.7 percent and 12.0 percent, respectively--was influenced significantly by insurance-related items associated with the addition of the new insurance-oriented financial holding company.

Strong asset growth was also reflected in slightly lower aggregate capital ratios during the quarter. Although these ratios remained well above minimum requirements, each of the three aggregate regulatory measures--the Tier 1 risk-based, total risk-based, and leverage capital ratios--fell about 20 basis points.

Net income fell $5 billion (18.0 percent), to $25 billion, related to widely publicized one-time litigation charges at two of the largest bank holding companies. Including these one-time charges, aggregate noninterest expenses rose $17 billion (20.0 percent) despite a slight decline in total employment at reporting bank holding companies (down 13,000, or 0.6 percent) that in turn was attributable to a falloff in mortgage origination activity. Net interest income and non-interest income each rose $4 billion, or about 6.0 percent. Net interest income was supported by an increase in interest-earning assets and a slight widening of the net interest margin (up 3 basis points, to 3.48 percent), while non-interest income benefited from stronger market-sensitive revenues. Realized securities gains fell 50.0 percent, or $1 billion, as rising long-term interest rates negatively affected the market value of investment securities.

Asset quality continued to improve with non-performing assets falling below 1.00 percent of loans and related assets for the first time in four years, reaching 0.97 percent. Net charge-offs declined to 0.64 percent of average loans, about on par with the loss rate experienced in 2000. With these indications of improvement, the aggregate allowance for loan losses remained unchanged at $75 billion despite the significant growth in loans noted earlier.
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 6,223,157 6,716,171 7,447,463

Loans 3,386,343 3,706,547 3,804,665
Securities and money market 2,082,428 2,191,024 2,558,749
Allowance for loan losses -54,875 -59,284 -67,343
Other 809,261 877,884 1,151,392

Total liabilities 5,756,993 6,201,163 6,866,122

Deposits 3,500,012 3,756,389 4,005,863
Borrowings 1,776,587 1,981,783 2,061,127
Other (3) 480,394 462,991 799,132

Total equity 466,164 515,008 581,341

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) 76,966 72,580 65,488
 Net interest income 187,211 195,780 221,626
 Provisions for loan losses 20,032 26,874 39,522
 Non-interest income 174,795 197,707 214,093
 Non-interest expense 225,364 254,800 297,196
 Security gains or losses 3,117 -614 4,297

Ratios (percent)
Return on average equity 17.44 15.15 11.76
Return on average assets 1.30 1.12 .90
Net interest margin (8) 3.71 3.56 3.58
Efficiency ratio (7) 61.32 62.57 66.04
Nonperforming assets to loans
 and related assets .85 1.09 1.45
Net charge-offs to average loans .54 .65 .89
Loans to deposits 96.75 98.67 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 Q4

Balance sheet

Total assets 7,940,580 8,819,567 7,940,580

Loans 4,044,387 4,393,702 4,044,387
Securities and money market 2,853,808 3,285,962 2,853,808
Allowance for loan losses -72,451 -72,220 -72,451
Other 1,114,836 1,212,123 1,114,836

Total liabilities 7,305,495 8,123,757 7,305,495

Deposits 4,332,313 4,674,255 4,332,313
Borrowings 2,228,020 2,610,400 2,228,020
Other (3) 745,162 839,103 745,162

Total equity 635,085 695,810 635,085

Off-balance-sheet
Unused commitments to lend (4) 3,650,669 4,097,531 3,650,669
Securitizations outstanding (5) 295,001 298,348 295,001
Derivatives (notional value,
 billions) (6) 57,864 72,877 57,864

Income statement
Net income (7) 84,678 106,656 18,732
 Net interest income 242,923 254,518 61,700
 Provisions for loan losses 42,928 31,532 11,545
 Non-interest income 215,879 244,814 56,758
 Non-interest expense 292,050 311,095 79,033
 Security gains or losses 4,503 5,764 1,644

Ratios (percent)
Return on average equity 14.05 16.24 12.13
Return on average assets 1.10 1.26 .94
Net interest margin (8) 3.72 3.50 3.63
Efficiency ratio (7) 62.72 61.72 65.76
Nonperforming assets to loans
 and related assets 1.46 1.16 1.46
Net charge-offs to average loans 1.02 .81 1.02
Loans to deposits 93.35 94.00 93.35

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

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

 2003

 Account or ratio (1),(2) Q1 Q2 Q3

Balance sheet

Total assets 8,176,401 8,671,732 8,693,481

Loans 4,112,535 4,265,235 4,336,327
Securities and money market 3,007,215 3,214,738 3,172,499
Allowance for loan losses -72,145 -72,476 -71,871
Other 1,128,795 1,264,236 1,256,527

Total liabilities 7,526,957 7,998,206 8,012,947

Deposits 4,426,402 4,571,789 4,576,475
Borrowings 2,315,467 2,508,601 2,553,019
Other (3) 785,089 917,815 883,454

Total equity 649,444 673,526 680,534

Off-balance-sheet
Unused commitments to lend (4) 3,714,160 3,756,486 3,887,356
Securitizations outstanding (5) 284,429 285,286 290,328
Derivatives (notional value,
 billions) (6) 64,116 68,330 69,416

Income statement
Net income (7) 24,777 26,348 27,265
 Net interest income 62,278 63,168 63,898
 Provisions for loan losses 8,574 8,428 7,110
 Non-interest income 57,426 61,698 61,380
 Non-interest expense 74,222 77,554 78,017
 Security gains or losses 1,854 2,675 583

Ratios (percent)
Return on average equity 15.65 16.13 16.42
Return on average assets 1.22 1.25 1.26
Net interest margin (8) 3.58 3.50 3.43
Efficiency ratio (7) 62.03 62.59 62.06
Nonperforming assets to loans
 and related assets 1.43 1.34 1.24
Net charge-offs to average loans .84 .80 .75
Loans to deposits 92.91 93.29 94.75

Regulatory capital ratios
Tier 1 risk-based 9.33 9.29 9.51
Total risk-based 12.42 12.29 12.52
Leverage 6.72 6.75 6.74

Number of reporting bank holding
 companies 2,036 2,064 2,120

 2003 2004

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

Balance sheet

Total assets 8,819,567 9,283,681 9,649,142

Loans 4,393,702 4,563,721 4,758,106
Securities and money market 3,285,962 3,573,028 3,613,913
Allowance for loan losses -72,220 -75,228 -75,230
Other 1,212,123 1,222,160 1,352,353

Total liabilities 8,123,757 8,547,359 8,882,600

Deposits 4,674,255 4,813,814 4,978,928
Borrowings 2,610,400 2,846,872 2,901,852
Other (3) 839,103 886,673 1,001,820

Total equity 695,810 736,322 766,542

Off-balance-sheet
Unused commitments to lend (4) 4,097,531 4,350,950 4,420,713
Securitizations outstanding (5) 298,348 308,543 314,259
Derivatives (notional value,
 billions) (6) 72,877 79,233 83,071

Income statement
Net income (7) 28,373 30,325 24,968
 Net interest income 65,359 67,971 71,910
 Provisions for loan losses 7,421 6,934 6,554
 Non-interest income 64,342 66,488 70,386
 Non-interest expense 81,368 82,944 99,684
 Security gains or losses 664 1,980 1,025

Ratios (percent)
Return on average equity 16.74 17.03 13.14
Return on average assets 1.30 1.33 1.03
Net interest margin (8) 3.48 3.45 3.48
Efficiency ratio (7) 62.42 61.88 62.30
Nonperforming assets to loans
 and related assets 1.16 1.10 .97
Net charge-offs to average loans .83 .70 .64
Loans to deposits 94.00 94.80 95.56

Regulatory capital ratios
Tier 1 risk-based 9.55 9.49 9.33
Total risk-based 12.58 12.44 12.23
Leverage 6.84 6.84 6.62

Number of reporting bank holding
 companies 2,134 2,192 2,210

Footnotes appear on p. 462.

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 5,054,896 5,430,376 5,788,065

Loans 2,646,916 2,881,205 2,891,509
Securities and money market 1,746,808 1,830,949 2,028,947
Allowance for loan losses -44,578 -47,654 -54,547
Other 705,750 765,877 922,156

Total liabilities 4,687,865 5,026,161 5,348,303

Deposits 2,634,891 2,798,809 2,968,425
Borrowings 1,599,841 1,792,392 1,849,911
Other (3) 453,132 434,960 529,968

Total equity 367,031 404,215 439,762

Off-balance-sheet
Unused commitments to lend (4) 2,867,877 3,063,974 3,225,542
Securitizations outstanding (5) n.a. n.a. 271,825
Derivatives (notional value,
 billions) (6) 37,882 43,532 48,140

Income statement
Net income (7) 64,044 59,234 50,884
 Net interest income 144,975 149,966 162,048
 Provisions for loan losses 17,120 23,148 34,447
 Non-interest income 156,233 177,773 168,777
 Non-interest expense 186,578 212,297 218,197
 Security gains or losses 2,224 -611 4,229

Ratios (percent)
Return on average equity 18.61 15.80 12.06
Return on average assets 1.33 1.13 .90
Net interest margin (8) 3.58 3.42 3.34
Efficiency ratio (7) 60.97 62.49 63.46
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 100.46 102.94 97.41

Regulatory capital ratios
Tier 1 risk-based 8.09 8.18 8.19
Total risk-based 11.32 11.45 11.56
Leverage 6.61 6.41 6.20

 2002

 Account or ratio (2),(9) 2002 2003 Q4

Balance sheet

Total assets 6,130,535 6,771,655 6,130,535

Loans 3,061,630 3,298,862 3,061,630
Securities and money market 2,254,041 2,594,012 2,254,041
Allowance for loan losses -58,193 -57,022 -58,193
Other 873,057 935,804 873,057

Total liabilities 5,654,767 6,254,732 5,654,767

Deposits 3,196,624 3,437,937 3,196,624
Borrowings 2,006,800 2,319,535 2,006,800
Other (3) 451,342 497,260 451,342

Total equity 475,768 516,923 475,768

Off-balance-sheet
Unused commitments to lend (4) 3,371,618 3,786,413 3,371,618
Securitizations outstanding (5) 289,320 292,312 289,320
Derivatives (notional value,
 billions) (6) 57,740 72,680 57,740

Income statement
Net income (7) 66,519 85,499 14,273
 Net interest income 178,692 186,969 45,911
 Provisions for loan losses 37,012 26,826 9,841
 Non-interest income 166,158 189,071 42,623
 Non-interest expense 209,482 222,462 56,743
 Security gains or losses 4,866 5,129 1,754

Ratios (percent)
Return on average equity 14.63 17.47 12.32
Return on average assets 1.12 1.30 .93
Net interest margin (8) 3.52 3.33 3.48
Efficiency ratio (7) 59.96 58.66 63.05
Nonperforming assets to loans
 and related assets 1.59 1.24 1.59
Net charge-offs to average loans 1.19 .94 1.17
Loans to deposits 95.78 95.95 95.78

Regulatory capital ratios
Tier 1 risk-based 8.48 8.75 8.48
Total risk-based 11.94 12.14 11.94
Leverage 6.20 6.30 6.20

 2003

 Account or ratio (2),(9) Q1 Q2 Q3

Balance sheet

Total assets 6,300,884 6,687,514 6,699,934

Loans 3,108,860 3,213,795 3,268,050
Securities and money market 2,367,484 2,533,061 2,498,520
Allowance for loan losses -57,472 -57,409 -56,593
Other 882,012 998,066 989,958

Total liabilities 5,816,536 6,187,285 6,192,507

Deposits 3,255,374 3,370,704 3,364,213
Borrowings 2,081,047 2,230,869 2,276,595
Other (3) 480,115 585,712 551,700

Total equity 484,348 500,229 507,427

Off-balance-sheet
Unused commitments to lend (4) 3,423,887 3,455,716 3,579,420
Securitizations outstanding (5) 278,633 279,083 284,134
Derivatives (notional value,
 billions) (6) 63,969 68,153 69,234

Income statement
Net income (7) 19,714 20,876 21,996
 Net interest income 45,804 46,322 47,244
 Provisions for loan losses 7,447 7,193 5,886
 Non-interest income 44,364 47,504 47,408
 Non-interest expense 53,053 55,434 56,192
 Security gains or losses 1,729 2,308 474

Ratios (percent)
Return on average equity 16.67 17.22 17.76
Return on average assets 1.25 1.29 1.31
Net interest margin (8) 3.40 3.32 3.28
Efficiency ratio (7) 59.15 59.52 59.12
Nonperforming assets to loans
 and related assets 1.53 1.43 1.31
Net charge-offs to average loans 1.01 .94 .86
Loans to deposits 95.50 95.34 97.14

Regulatory capital ratios
Tier 1 risk-based 8.57 8.50 8.76
Total risk-based 12.05 11.88 12.14
Leverage 6.22 6.23 6.23

 2003 2004

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

Balance sheet

Total assets 6,771,655 7,201,957 7,385,384

Loans 3,298,862 3,450,031 3,579,264
Securities and money market 2,594,012 2,866,218 2,850,165
Allowance for loan losses -57,022 -59,658 -59,312
Other 935,804 945,365 1,015,267

Total liabilities 6,254,732 6,649,235 6,810,685

Deposits 3,437,937 3,552,847 3,678,320
Borrowings 2,319,535 2,567,757 2,591,833
Other (3) 497,260 528,632 540,533

Total equity 516,923 552,723 574,699

Off-balance-sheet
Unused commitments to lend (4) 3,786,413 4,033,475 4,085,732
Securitizations outstanding (5) 292,312 304,545 307,878
Derivatives (notional value,
 billions) (6) 72,680 78,995 82,793

Income statement
Net income (7) 23,020 24,573 18,248
 Net interest income 47,784 50,512 51,903
 Provisions for loan losses 6,302 6,113 5,716
 Non-interest income 49,827 52,331 52,937
 Non-interest expense 57,849 60,260 72,435
 Security gains or losses 629 1,592 707

Ratios (percent)
Return on average equity 18.21 18.34 12.79
Return on average assets 1.37 1.38 .98
Net interest margin (8) 3.30 3.29 3.25
Efficiency ratio (7) 58.92 58.97 58.47
Nonperforming assets to loans
 and related assets 1.24 1.16 1.02
Net charge-offs to average loans .95 .85 .76
Loans to deposits 95.95 97.11 97.31

Regulatory capital ratios
Tier 1 risk-based 8.75 8.69 8.54
Total risk-based 12.14 11.99 11.80
Leverage 6.30 6.30 6.06

Footnotes appear on p. 462.

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 1,139,481 1,252,272 1,357,591

Loans 728,145 812,354 864,958
Securities and money market 319,683 341,392 378,714
Allowance for loan losses -10,120 -11,420 -12,456
Other 101,772 109,946 126,374

Total liabilities 1,042,264 1,143,488 1,236,362

Deposits 865,120 957,497 1,031,189
Borrowings 155,172 159,704 177,746
Other (3) 21,971 26,288 27,427

Total equity 97,217 108,784 121,229

Off-balance-sheet
Unused commitments to lend (4) 214,524 225,188 246,518
Securitizations outstanding (5) n.a. n.a. 4,567
Derivatives (notional value,
 billions) (6) 29 54 92

Income statement
Net income (7) 12,773 13,326 14,547
 Net interest income 42,152 45,820 48,263
 Provisions for loan losses 2,818 3,584 4,641
 Non-interest income 16,761 18,000 23,148
 Non-interest expense 37,270 40,763 45,883
 Security gains or losses 825 -9 777

Ratios (percent)
Return on average equity 13.23 13.05 12.42
Return on average assets 1.16 1.12 1.12
Net interest margin (8) 4.28 4.26 4.14
Efficiency ratio (7) 62.45 62.20 63.31
Nonperforming assets to loans
 and related assets .68 .76 .96
Net charge-offs to average loans .30 .32 .43
Loans to deposits 84.17 84.84 83.88

Regulatory capital ratios
Tier 1 risk-based 12.31 11.95 12.22
Total risk-based 13.76 13.43 13.84
Leverage 8.64 8.58 8.76

Number of other reporting bank
 holding companies 1,569 1,662 1,787

 2002

 Account (1),(10) 2002 2003 Q4

Balance sheet

Total assets 1,492,331 1,637,803 1,492,331

Loans 935,559 1,024,315 935,559
Securities and money market 431,331 476,099 431,331
Allowance for loan losses -13,846 -14,807 -13,846
Other 139,287 152,197 139,287

Total liabilities 1,355,581 1,488,723 1,355,581

Deposits 1,126,759 1,224,061 1,126,759
Borrowings 195,779 228,247 195,779
Other (3) 33,043 36,416 33,043

Total equity 136,750 149,080 136,750

Off-balance-sheet
Unused commitments to lend (4) 267,702 298,678 267,702
Securitizations outstanding (5) 4,942 4,893 4,942
Derivatives (notional value,
 billions) (6) 92 100 92

Income statement
Net income (7) 17,491 18,885 4,270
 Net interest income 53,397 55,851 13,450
 Provisions for loan losses 5,286 4,489 1,501
 Non-interest income 25,431 28,556 6,829
 Non-interest expense 48,640 53,300 12,813
 Security gains or losses 720 1,068 187

Ratios (percent)
Return on average equity 13.62 13.21 12.73
Return on average assets 1.24 1.21 1.17
Net interest margin (8) 4.23 3.98 4.10
Efficiency ratio (7) 60.68 62.37 62.89
Nonperforming assets to loans
 and related assets 1.01 .97 1.01
Net charge-offs to average loans .46 .39 .53
Loans to deposits 83.03 83.68 83.03

Regulatory capital ratios
Tier 1 risk-based 12.43 12.55 12.43
Total risk-based 14.09 14.29 14.09
Leverage 8.87 9.00 8.87

Number of other reporting bank
 holding companies 1,924 2,079 1,924

 2003

 Account (1),(10) Q1 Q2 Q3

Balance sheet

Total assets 1,542,977 1,592,260 1,601,862

Loans 955,062 983,697 998,611
Securities and money market 461,219 475,557 469,580
Allowance for loan losses -14,257 -14,561 -14,819
Other 140,953 147,567 148,490

Total liabilities 1,401,217 1,446,066 1,456,009

Deposits 1,161,786 1,190,063 1,200,684
Borrowings 203,750 218,533 219,588
Other (3) 35,681 37,471 35,737

Total equity 141,760 146,194 145,853

Off-balance-sheet
Unused commitments to lend (4) 279,012 289,060 295,792
Securitizations outstanding (5) 4,994 5,205 5,116
Derivatives (notional value,
 billions) (6) 104 110 105

Income statement
Net income (7) 4,688 4,915 4,798
 Net interest income 13,691 13,881 13,799
 Provisions for loan losses 1,060 1,146 1,104
 Non-interest income 6,891 7,579 7,260
 Non-interest expense 12,788 13,427 13,180
 Security gains or losses 300 431 135

Ratios (percent)
Return on average equity 13.47 13.74 13.43
Return on average assets 1.24 1.26 1.21
Net interest margin (8) 4.04 3.98 3.89
Efficiency ratio (7) 61.48 63.23 62.32
Nonperforming assets to loans
 and related assets 1.12 1.08 1.02
Net charge-offs to average loans .32 .37 .35
Loans to deposits 82.21 82.66 83.17

Regulatory capital ratios
Tier 1 risk-based 12.58 12.53 12.55
Total risk-based 14.28 14.24 14.28
Leverage 8.96 8.92 8.94

Number of other reporting bank
 holding companies 1,981 2,009 2,065

 2003 2004

 Account (1),(10) Q4 Q1 Q2

Balance sheet

Total assets 1,637,803 1,661,742 1,727,090

Loans 1,024,315 1,043,110 1,093,656
Securities and money market 476,099 485,059 488,118
Allowance for loan losses -14,807 -15,186 -15,576
Other 152,197 148,759 160,892

Total liabilities 1,488,723 1,509,303 1,573,834

Deposits 1,224,061 1,246,986 1,284,808
Borrowings 228,247 220,065 248,848
Other (3) 36,416 42,253 40,178

Total equity 149,080 152,439 153,256

Off-balance-sheet
Unused commitments to lend (4) 298,678 304,093 319,963
Securitizations outstanding (5) 4,893 2,875 3,001
Derivatives (notional value,
 billions) (6) 100 128 123

Income statement
Net income (7) 4,484 5,059 5,165
 Net interest income 14,480 14,443 14,839
 Provisions for loan losses 1,179 856 846
 Non-interest income 6,826 6,989 7,026
 Non-interest expense 13,906 13,579 13,767
 Security gains or losses 202 328 114

Ratios (percent)
Return on average equity 12.22 13.61 13.48
Return on average assets 1.11 1.24 1.22
Net interest margin (8) 3.99 3.96 3.90
Efficiency ratio (7) 65.20 62.67 62.36
Nonperforming assets to loans
 and related assets .97 .96 .86
Net charge-offs to average loans .50 .24 .26
Loans to deposits 83.68 83.65 85.12

Regulatory capital ratios
Tier 1 risk-based 12.55 12.52 12.36
Total risk-based 14.29 14.25 14.07
Leverage 9.00 9.06 9.03

Number of other reporting bank
 holding companies 2,079 2,137 2,155

Footnotes appear on p. 462.

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) 5,054,896 5,430,376 5,788,065
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 Q4

Bank holding companies that
 qualify as financial holding
 companies (11),(12)
Domestic
 Number 434 451 434
 Total assets 5,916,859 6,605,639 5,916,859
Foreign-owned (13)
 Number 11 12 11
 Total assets 616,254 710,441 616,254

Total U.S. commercial bank
 assets (14) 6,897,447 7,397,810 6,897,447

 By ownership
 Reporting bank holding
 companies 6,429,738 6,940,984 6,429,738
 Other bank holding companies 227,017 219,222 227,017
 Independent banks 240,692 237,604 240,692

Assets associated with nonbanking
 activities (12),(15)
Insurance 350,633 411,926 350,633
Securities broker--dealers 630,851 656,775 630,851
Thrift institutions 107,422 133,056 107,422
Foreign nonbank institutions 145,344 170,600 145,344
Other nonbank institutions 561,712 686,353 561,712

Number of bank holding companies
 engaged in nonbanking
 activities (12),(15)
Insurance 86 101 86
Securities broker--dealers 47 50 47
Thrift institutions 32 27 32
Foreign nonbank institutions 37 41 37
Other nonbank institutions 880 1,041 880

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

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

Assets of fifty large bank
 holding companies (9),(17)
Fixed panel (from table 2) 6,130,535 6,771,655 6,130,535
Fifty large as of reporting date 6,032,000 6,666,488 6,032,000
Percent of all reporting
 bank holding companies 76.00 75.60 76.00

 2003

 Account Q1 Q2 Q3

Bank holding companies that
 qualify as financial holding
 companies (11),(12)
Domestic
 Number 437 440 448
 Total assets 6,061,696 6,433,736 6,447,130
Foreign-owned (13)
 Number 11 11 11
 Total assets 648,017 732,695 729,244

Total U.S. commercial bank
 assets (14) 7,031,274 7,325,350 7,293,920

 By ownership
 Reporting bank holding
 companies 6,577,712 6,863,154 6,842,727
 Other bank holding companies 222,670 222,998 217,035
 Independent banks 230,893 239,198 234,157

Assets associated with nonbanking
 activities (12),(15)
Insurance 359,968 383,999 398,378
Securities broker--dealers 709,839 659,701 686,049
Thrift institutions 126,375 124,640 143,578
Foreign nonbank institutions 154,812 160,515 162,789
Other nonbank institutions 524,709 737,434 736,515

Number of bank holding companies
 engaged in nonbanking
 activities (12),(15)
Insurance 90 91 100
Securities broker--dealers 48 50 46
Thrift institutions 31 31 29
Foreign nonbank institutions 38 40 39
Other nonbank institutions 913 945 992

Foreign-owned bank holding
 companies (13)
Number 26 27 28
Total assets 799,540 946,847 947,932

Employees of reporting bank
 holding companies
 (full-time equivalent) 2,000,168 2,019,953 2,031,029

Assets of fifty large bank
 holding companies (9),(17)
Fixed panel (from table 2) 6,300,884 6,687,514 6,699,934
Fifty large as of reporting date 6,203,000 6,587,000 6,602,255
Percent of all reporting
 bank holding companies 75.90 76.00 75.90

 2003 2004

 Account Q4 Q1 Q2

Bank holding companies that
 qualify as financial holding
 companies (11),(12)
Domestic
 Number 451 463 469
 Total assets 6,605,639 6,839,971 7,063,919
Foreign-owned (13)
 Number 12 13 14
 Total assets 710,441 995,454 1,117,729

Total U.S. commercial bank
 assets (14) 7,397,810 7,614,351 7,850,548

 By ownership
 Reporting bank holding
 companies 6,940,984 7,165,497 7,408,873
 Other bank holding companies 219,222 213,194 211,958
 Independent banks 237,604 235,660 229,717

Assets associated with nonbanking
 activities (12),(15)
Insurance 411,926 428,132 543,492
Securities broker--dealers 656,775 713,794 710,485
Thrift institutions 133,056 139,713 156,033
Foreign nonbank institutions 170,600 195,472 226,055
Other nonbank institutions 686,353 837,470 861,311

Number of bank holding companies
 engaged in nonbanking
 activities (12),(15)
Insurance 101 99 101
Securities broker--dealers 50 49 48
Thrift institutions 27 29 27
Foreign nonbank institutions 41 41 40
Other nonbank institutions 1,041 1,022 1,039

Foreign-owned bank holding
 companies (13)
Number 28 28 29
Total assets 934,781 1,146,963 1,272,561

Employees of reporting bank
 holding companies
 (full-time equivalent) 2,034,358 2,099,073 2,085,671

Assets of fifty large bank
 holding companies (9),(17)
Fixed panel (from table 2) 6,771,655 7,201,957 7,385,384
Fifty large as of reporting date 6,666,488 7,045,844 7,385,384
Percent of all reporting
 bank holding companies 75.60 75.90 76.50

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
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Geographic Code:1USA
Date:Sep 22, 2004
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