Colorado banks reported aggregate net income of $351 million for the third quarter of 2013, a federal reports shows, a $36 million increase from the same period last year.
Nationwide, meanwhile, banks reported their first year-over-year earnings decline in 17 quarters.
The Federal Deposit Insurance Corp. partially attributed the national drop — from $37.5 billion in the quarter ended Sept. 30 last year to $36 billion this year — to lower revenue from reduced mortgage activity and lower gains on asset sales.
Revenue growth at Colorado banks, despite a slight dip in the yield on returning assets, appears partly rooted in fewer banks deemed unprofitable (roughly 13 percent) and a significant decrease in credit loss.
Nationally, 8.6 percent of institutions were deemed unprofitable, a drop from 10.7 percent the previous year.
The year-to-year drop in nonperforming assets among Colorado banks appears to have played a role as well, dipping from 2.38 percent in the third quarter of 2012 to 1.71 percent this year, the report shows.
“Fewer institutions reported quarterly losses, lending grew at a modest pace, credit quality continued to improve, more banks came off the ‘Problem List,’ and fewer banks failed,” FDIC Chairman Martin Gruenberg said in a statement.
The American Bankers Association pointed out that banks overall “delivered a solid performance marked by strong business and auto loan growth and a continued improvement in asset quality,” chief ABA economist James Chessen said in a statement. “At the same time, the near disappearance of mortgage refinancing due to rising interest rates has hindered bank revenue.”
Colorado banks also showed a large drop in the amount of real-estate-owned properties, or those acquired through foreclosure, from $452 million in Q3 2012 to $343 million for the same quarter this year.
