WASHINGTON—Community banks reported an 8.2% increase in second-quarter net income from the previous quarter, according to the FDIC’s latest Quarterly Banking Profile.
Higher net interest income, up 4%, and noninterest income, up 7.9%, helped offset increases in noninterest and provision expenses, the Independent Community Bankers Association stated in its analysis.
Community banks’ pretax return on assets rose 11 basis points from the first quarter and 17 basis points from a year earlier to 1.53%. Net interest margin increased 10 basis points during the quarter and 19 basis points year-over-year to 3.81%, while net operating revenue rose 4.6%.
Total community bank assets increased 0.8% from the previous quarter and 4.8% from a year earlier. Loans and leases grew 1.6% quarterly and 5.1% annually, with growth across every major portfolio except auto loans. Deposits increased 0.4% during the quarter and 4.6% year-over-year, ICBA said.
Across the overall banking industry, net income rose 12% from the first quarter and 28.7% from a year earlier. The Deposit Insurance Fund increased by $3.7 billion to $161.1 billion, lifting its reserve ratio five basis points to 1.48%. The number of FDIC-insured institutions declined by 41 to 4,238, while the number of community banks fell by 35 to 3,818.