US banking sector profits climb 13.5% in Q3

ISTANBUL

US banking sector profits increased by 13.5% in the third quarter of this year compared to the previous quarter, reaching $79.3 billion, US Federal Deposit Insurance Corporation (FDIC) said Monday.

The agency reported that the net profit of 4,379 commercial banks and thrift institutions covered by the FDIC was $79.3 billion in the third quarter of this year, up $9.4 billion.

"Strong net interest income growth and a reduction in provision expense, primarily related to last quarter’s large bank acquisition, drove the quarterly increase in earnings," the agency said in a statement.

The net interest income increased by $7.6 billion, or 4.2% compared to the previous quarter, while provision expense was down $9.2 billion, or 30.7%.

Meanwhile, income taxes rose by $5 billion, or 30.1%, and noninterest expense was up $2.9 billion, or 1.9%.

"The quarterly decrease in provision expense was largely attributable to expenses associated with the acquisition of one large bank in the prior quarter," it said.

The statement added that banks' asset quality indicators are generally positive, but weaknesses persist in some portfolios.