WASHINGTON — Commercial loan activity at banks doesn't appear to be slowing down anytime soon.
The Federal Deposit Insurance Corp. recently reported that commercial real estate properties exhibited "significant growth" and were up by $21.3 billion in the second quarter. Loans to small businesses and farms grew "at a more rapid rate" in the 12 months ended June 30, 2006 than in the 12 months ended June 30, 2005, the regulator reported in its second quarter Quarterly Banking Profile.
During the last 12 months, commercial and industrial loans with amounts of $1 million or less increased by $12.7 billion while larger ones grew by $80.5 billion, FDIC reported. On the other end, C&I loans with original amounts of $1 million or less increased by $20.7 million while larger loans grew by $55.6 billion.
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Even with loans under $500,000, banks continue to see growth. Agricultural production loans in that category increased by $1.5 billion in the second quarter while larger ones rose by $3 billion. Real estate loans secured by farmland with original amounts of $500,000 or less increased by $921 million while larger farm real estate loans increased by $2.9 billion. Strong commercial and consumer loan demand were the two main contributors to commercial banks and savings institutions posting $38 billion in profits in the second quarter, FDIC said. CUNA President/CEO Dan Mica said this is the fifth time in the last six quarters that the banking industry has posted all-time high quarterly profits. –[email protected]
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