Georgia bank profits climb in 2017

Georgia’s banks earned a collective $3.4 billion in 2017, but growth in new loans and deposits slowed compared to the prior year.

The Federal Deposit Insurance Corp. on Tuesday released its full year report on bank earnings for the nation and the state. It showed net loans and leases grew by a tepid 1 percent to $221.1 billion for Georgia banks in 2017, while total deposits held by Georgia-based institutions grew by about 2.6 percent to $258.4 billion.

It’s growth but it’s not at the pace seen last year when banks reported annual loan growth of about 6 percent and deposit growth of 5 percent, respectively, over 2015.

“In broad terms, Georgia’s economy, families and business had a good 2017 financially, and that’s reflected in the performance of our state’s banking industry,” Joe Brannen, president and CEO of the Georgia Bankers Association, said in a statement. “Georgia’s banks were active in lending, they remained trusted protectors of deposits and borrowers were able to meet their obligations.”

Georgia’s largest bank, SunTrust, reported profits of $2.27 billion in 2017, or about two-thirds of the overall profits for the state’s banks.

For the fourth quarter, the state’s banks reported $942 million in profit, up 24 percent from the same period in 2016.

About 92 percent of all Georgia banks were profitable for the year, according to FDIC data.

Banks are key cogs in the economy and vital barometers of broader economic health. The state has seen a rebound in jobs since the Great Recession, and real estate market also is stronger.

It wasn’t long ago that the state’s financial industry was in turmoil.

Georgia led the nation in community bank failures coming out of the Great Recession, and the downturn deeply wounded many of the survivors.

The trouble in Georgia was primarily real estate-related, but the financial crisis forced healthy and troubled banks alike to tighten standards and curb all sorts of lending to weather the economic storm.

But a warming economy, job growth and new consumer demand help propel the rebound.

On a national level, U.S. banks earned $25.5 billion in the fourth quarter, down about 41 percent from the same period in 2016, largely because of one-time charges related to the new federal tax overhaul.

For the year, the nation’s banks earned $165.8 billion, or about 3.5 percent less than 2016.

The FDIC’s “Problem Bank List” declined to 95 during the fourth quarter, the lowest total since early 2008.

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