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ABA: The American Bankers Association

ABA Statement on FDIC's Quarterly Banking Profile

“Today’s FDIC report on the condition of America’s banks in the second quarter provides encouraging news on the availability of credit. Total bank lending rose slightly following three quarterly declines as the financial health of consumers and businesses strengthened. The recovery was broad-based, with growth in most loan categories. Consumer loans led the growth, with a 4.1% increase in credit card lines and a 3.8% rise in auto loans.

“Overall credit growth would have been even stronger if not for a 4.9% quarterly decline in business lending, which can be attributed to the wind-down of the highly successful Paycheck Protection Program. When PPP is excluded, business lending rose 1.2% in the quarter.

“Strong asset quality supported the upswing in bank loan portfolios. The share of industry loans that were 30 to 90 days delinquent fell significantly to the lowest level since 1999, while loans 90 or more days late declined for a second consecutive quarter and were below the average level of the four-year period prior to the onset of the COVID-19 recession. Despite modest loan growth and strong asset quality, net interest margin contracted to another record low of 2.53%.

“The strength of banks’ credit portfolios allowed them to again recover reserves, as in the prior quarter. Nonetheless, industry reserves as a share of loans remained above the 2019, pre-recession level. In another sign of bank strength, the tier 1 risk-based capital ratio climbed to the highest ever reported by the FDIC. Deposits continued to flow into banks of all sizes as individuals and businesses continue to seek the safety of FDIC-insured bank accounts. Bank deposits are now 29% higher than in 2019.

“America’s banks remain resilient and well positioned to withstand potential headwinds as the economic recovery pushes forward.”


About the American Bankers Association

The American Bankers Association is the voice of the nation’s $23.6 trillion banking industry, which is composed of small, regional and large banks that together employ more than 2 million people, safeguard $19.4 trillion in deposits and extend $12 trillion in loans.

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