Net income of $66.8 billion for the fourth quarter of last year was posted by the nation’s banks, the federal insurer of bank deposits said Tuesday, while also noting that return on assets (ROA) – the basic yardstick of profitability – had increased for 2024 from the prior year.
The Federal Deposit Insurance Corp. (FDIC) said net income among the 4,487 commercial banks and savings institutions that it insures was up $1.5 billion (2.3%) from the prior quarter, and $14.1 billion (or 5.6%) from the prior year. The agency said the increase in in net income was driven by a quarterly increase in net interest income.
Overall, the FDIC said, net income at the banks was $268.2 billion for 2024.
The FDIC also said that that quarterly ROA was also driven by higher net interest income.
“The increases in net income and ROA occurred primarily because one-time events in 2023 and 2024 led to lower noninterest expense, higher noninterest income, and lower realized securities losses in 2024,” the FDIC said in a release.
As for the quarterly increase, the FDIC said, it was largely driven by an increase in net interest income, “as declining short-term interest rates reduced interest expense more than interest income.”
Meanwhile, the agency reported, the FDIC’s Deposit Insurance Fund (DIF) reserve ratio increased three basis points to 1.28%. The agency said that, In the fourth quarter, the DIF balance increased $4.0 billion to $137.1 billion. That resulted in a reserve ratio increase of three basis points during the quarter.
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