Colorado’s share of struggling banks fell while the share of recommended banks rose between the second and third quarters, reports BauerFinancial, a Florida firm that rates banks and credit unions.
BauerFinancial estimates that as of Sept. 30, 21.1 percent of Colorado’s banks had two or fewer stars on a five-star scale, meeting the definition of “troubled and problematic.” A quarter of Colorado banks met that definition on June 30.
Colorado’s ratio of troubled and problematic banks remains nearly double the U.S. average. Nationally, only 11.4 percent of U.S. banks had two or fewer stars, the smallest share since the first quarter of 2009, BauerFinancial said.
Banks with four or five stars, defined as recommended, rose to 45 percent of the total on Sept. 30, up from 42 percent on June 30. Nationally, 62 percent of banks were recommended as of Sept. 30.
A separate report Thursday from the FDIC also showed improving conditions at Colorado banks during the third quarter.
Concentration in real estate loans as a share of capital continued to decline, as did the number of banks relying on volatile brokered deposits arranged through third parties.
