September 29, 2010
DFI - Quarterly Report - Second Quarter 2010
Report (Excel) Second Quarter 2010
The Quarterly Report presents summary statistics for banks, industrial banks, credit unions, offices of foreign banks and trust companies with a one-year comparison. The intention of the Quarterly Report is to show at-a-glance significant changes on the balance sheets and reports of income of DFI licensees. We invite readers to review the Financial Statistics page on our website, and the financial data published by the Federal Reserve Bank, Federal Deposit Insurance Corporation and National Credit Union Administration.
At the close of the second quarter 2010, the number of state-chartered banks decreased by 17 or 7.9% to 198 from 215 on June 30 one year ago. Assets went from $238.6 billion to $225.8 billion, down $12.8 billion or 5.4% over the same period. Total equity capital was up 5.1%, from $27.8 billion one year ago to $29.2 billion at midyear 2010, causing the equity capital to total asset ratio to increase from 11.66% to 12.95%. Loans were down 11.0%, going from $168.2 billion to $149.6 billion, while deposits were down $4.7 billion or 2.7% from $174.0 billion to $169.3 billion. This caused the loan to deposit ratio to decrease to 88.3% from 96.7% one year previous.
For the first half 2010, state-chartered banks reported net income of $79.1 million, as compared to a net loss of $990.2 million in the second quarter 2009. Loan loss provisions in the same period were down $1.5 billion from $3.0 billion to $1.5 billion, a decrease of 49.8%.
The net interest margin was up from 3.13% one year ago to 3.53%. Loan loss reserves in the second quarter 2010 were up $75 million, to $4.0 billion, an increase of 1.9% while noncurrent loans were down 11.5% from $7.0 billion to $6.2 billion over the same period. This caused reserve coverage of noncurrent loans to increase from 56.68% to 65.22%. Other real estate owned increased 23.0%, going from $1.0 billion to $1.3 billion.
As of June 30, 2010, industrial bank assets were $8.9 billion, down 4.1% from $9.3 billion one year ago. Total equity capital was up 1.7% to $1.4 billion. This caused the capital to asset ratio to increase from 14.54% to 15.41%. Loans were down 9.9%, going from $6.6 billion to $6.0 billion, while deposits declined 5.2%, going from $7.3 billion to $6.9 billion, which caused the loan to deposit ratio to decline from 90.91% to 86.40 percent.
Industrial banks showed a net profit of $9.8 million for the first half of 2010, as compared to a net loss of $69.2 million at midyear 2009. The net interest margin increased from 4.40% to 5.04% while the provision for loan losses was $109.2 million for the quarter, down 31.0% from $158.2 million in the second quarter 2009. Loan loss reserves were up 23.8% from $236.6 million to $292.8 million over the period, while noncurrent loans increased from $142.3 million to $466.9 million, up $324.5 million or 466.9%. This caused reserve coverage of noncurrent loans to decrease from 166.2% to 62.72%. Other real estate owned increased by 298.2%, going from $9.5 million at the close of the second quarter 2009 to $37.9 million as of June 30, 2010. During the period, the number of industrial banks remained constant at ten.
Assets, at $72.5 billion were down 3.3% from the $74.9 billion reported as of June 30, 2009, while shares went from $63.0 billion to $62.1 billion, down 1.3%. Loans were down 10.2% from June 30 one year ago, going from $49.7 billion to $44.6 billion. At $6.6 billion on June 30, net worth was down a fraction of a percent. This caused the net worth to asset ratio to increase to 9.09% from 8.84% one year ago. The allowance for loan losses for the quarter was up 17.9%, going from $1.2 billion to $1.4 billion, while delinquent loans increased 9.9%, going from $1.1 million to $1.2 billion.
Net margin to average assets increased to 4.41% from 4.22% one year ago, while the provision for loan losses was down 44.6% going from $775.4 million to $429.8 million over the same period. Net income went from a net loss of $348.5 million for the first half of 2009 to a net profit of $128.0 million for the same period in 2010, up $476.4 million. The number of credit unions went from 181 to 167; a decrease of 14, or 7.7 percent.
Total assets of state chartered offices of foreign banks were down $1.0 billion or 4.2% from $24.0 billion as of June 30, 2009 to $23.0 billion one year later, while loans were down 13.3% from $16.8 billion to $14.6 billion during the same period. Deposits were up 5.2%, from $11.4 billion as of June 30, 2009 to $12.0 billion one year later. Net income of foreign banks in the first half of 2010 was $73.7 million, down 19.8% from the $91.8 million reported at midyear 2009. The number of foreign banking organizations with state-chartered offices in California decreased by three, going from 34 to 31 during the year.
Total corporate assets of trust companies at the close of the second quarter 2010 were $419.7 million, down $40.0 million or 8.7% from the $459.8 million a year previous. Income from fiduciary activities was up from $190.5 million in June 2009 to $208.8 million at the close of the second quarter 2010, an increase of $18.3 million or 9.6% over the year, while net income was up $34.8 million from a net loss of $43.5 million for the second quarter of 2009 to a net loss of $8.6 million for the same period in 2010. The number of trust companies remained stable throughout the year at seven.