Both smaller community banks and large banks in Pennsylvania, Delaware and New Jersey are reporting growth in profits for the third quarter ended Sept. 30 compared to a year ago as loan quality improved and nonperforming loans and chargeoffs dropped, according to a report from the Federal Reserve Bank of Philadelphia.
Profits grew by $4.3 billion, or 2.1 percent, at community banks. These banks also noted improvements in loan-loss provisions as loan quality improved and asset sales rose. At large banks, net income for the third quarter grew 3 percent to $25.3 billion from $24.5 billion a year earlier. Asset quality overall improved within most of the banking categories, according to a report by Housing Wire.
While loan quality improved in most banking categories, larger banks saw their loan quality deteriorate somewhat for the second straight quarter in the third quarter, according to the Fed Bank.
It also noted that real-estate owned properties declined at large banks and community banks nationally, falling 11.8 percent and 7.1 percent. On a local level within the three states, REOs remained mostly flat.