IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this article

Profits and balance sheet developments at U.S. commercial banks in 2003

Listed author(s):
  • Mark A. Carlson
  • Roberto Perli

Amid a strengthening economic expansion, U.S. commercial banks remained highly profitable in 2003. Return on assets reached a record level for the second year in a row, and return on equity was near the top of its recent range. Banks' profits were bolstered by decreased loan-loss provisions as a rising economy and considerable debt refinancing at very low interest rates led to lower delinquency rates on business and household loans. Fees associated with record mortgage refinancing activity and robust corporate bond issuance boosted non-interest income. Increases in non-interest expense were generally modest, although compensation-related costs rose more briskly. Lower long-term interest rates in the first part of the year allowed banks to realize gains on the sale of some of their securities, but they also contributed to a further shrinking of net interest margins. Banks' balance sheets expanded briskly, as the strong housing market and heavy refinancing activity boosted residential mortgages and mortgage-backed securities. Business loans ran off for a third year, albeit at a slower pace than in 2002 and 2003. Banks' regulatory capital positions strengthened further, as the growth of assets with low regulatory risk weights outpaced that of assets with higher risk weights.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: no

Article provided by Board of Governors of the Federal Reserve System (U.S.) in its journal Federal Reserve Bulletin.

Volume (Year): (2004)
Issue (Month): Spr ()
Pages: 162-191

in new window

Handle: RePEc:fip:fedgrb:y:2004:i:spr:p:162-191:n:v.90no.2
Contact details of provider: Postal:
20th Street and Constitution Avenue, NW, Washington, DC 20551

Web page:

More information through EDIRC

Order Information: Email:

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:fip:fedgrb:y:2004:i:spr:p:162-191:n:v.90no.2. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Kris Vajs)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.