WASHINGTON—U.S. banking industry profits jumped again in the third quarter, as banks saw stronger revenue and set aside fewer reserves against bad loans.
Net income for the roughly 7,700 U.S. banks and thrifts totaled $14.5 billion for the quarter, up from $2 billion a year earlier, the Federal Deposit Insurance Corp. reported Tuesday.
The share of unprofitable banks at the end of the third quarter dropped to the lowest level since June 2008. Fewer than one in five banks, or 18.9%, reported a loss for the third quarter of 2010. A year ago, nearly a third of all U.S. banks were in the red.
Meanwhile, almost two out of every three banks, or 63.3%, reported higher profits for the quarter from a year earlier.
Quarterly profits, however, were down from the $17.7 billion and the $21.4 billion reported in the first and the second quarters of this year, respectively. The drop was due to a quarterly loss at Bank of America Corp. driven by a $10.4 billion charge the bank took because financial regulations would make its credit-card unit less profitable.
Full story: U.S. Bank Profits Climb