HPS FDIC Quarterly Banking Profile Preview
By Patrick Sims, psims@hamiltonps.com, 202-822-1205
Click to view the HPS FDIC Quarterly Banking Profile Preview here.
The HPS FDIC Quarterly Banking Profile Preview examines FDIC-regulated entities progress in three key areas: safety and soundness, performance, and support to the economy. In the Q4’12, we find:
- U.S. commercial banks’ Tier One Common Capital Ratio was 12.6 percent as U.S. commercial banks increased common capital levels to $1.13 trillion.
- U.S. commercial bank’s Net Income decreased slightly quarter-over-quarter to $32.26 billion, but is the most profitable year since the crisis on an annual basis.
- U.S. commercial bank’s ROAA and ROAE followed the same pattern as Net Income on both a quarterly and annual basis, and ended the year at 1.02 and 9.08, respectively.
- U.S. commercial banks’ Loan-to-Deposit ratio fell to 70.3 percent, in a large part due to the increase in deposits.
- U.S. commercial banks’ topped $10 trillion in deposits, an all-time high. Total bank deposits rose to near $11 trillion.
- Total reserves fell by three percent to $151 million for U.S. commercial banks; while non-performing
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The Hamilton Financial Index
By Matt McDonald, mmcdonald@hamiltonps.com, 202-822-1205
Read the full report here.
The Hamilton Financial Index (HFI) combines both financial stress, represented by the St. Louis Financial Stress Index, and industry-level capitalization, represented by the Tier One Common Capital ratio, to provide a clear snapshot of the safety and soundness of the financial services sector. The key findings are:
- Currently, the HFI shows that financial institutions are significantly safer today with a score of 1.28, 28 percent higher than historical norms.
- The rise in the HFI reflects growth in capital. If capital levels remained at pre- crisis levels, the HFI would be below pre-crisis norms with a reading of 0.95.
- U.S. banks Tier One Common Capital ratio is 12.6 percent, a year-over-year increase of 1.3 percent.
- U.S. banks Tier One Common Capital increased to $1.13 trillion.
- The ratio of Risk-Weighted Assets to Total Assets fell 1.3 percent year-over-year.
- Financial stress declined in the fourth quarter of 2012.
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Trade Talk Tuesday?
By Tucker Warren, twarren@hamiltonps.com and Kate Bernard, kbernard@hamiltonps.com, 202-822-1205
Will the President use SOTU to endorse trade?
As President Obama prepares for his fifth State of the Union address, speculation is underway about which policies and priorities he will highlight this year. Weekend predictions suggest we’re in for a presidential pivot towards job creation, with odds favoring mentions of immigration, education and public investment in roads and research. This theme comes as no surprise given the current state of the economy. The most recent Jobs Day Cheat Sheet by Hamilton Place Strategies shows that another 3.2 million jobs need to be created to return to our pre-recession peak.
Free trade should also be up for discussion, which would serve several purposes for the President: a plank supporting job creation, an olive-branch to the business community, the realization of his goal to triple exports by 2015 and an opportunity for bipartisan leadership. In fact, the proposed Trans-Pacific Partnership (TPP) agreement has long enjoyed bipartisan support, having originated during the Bush Administration and garnering support from …