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Economic Perspectives, Vol. 11, 2nd, No. 3, May 1987
Crosscurrents in 1986 bank performance

U.S. banking registered lower profitability in 1986, as the industry withstood another year of heavy loan losses. Problem loans, meanwhile, halted their recent relative decline.

 

This somewhat disappointing news comes despite a fifth consecutive year of U.S. economic expansion and it fuels the arguments of those who suggest a long-term decline in U.S. banking. A closer look at the variety of performance across the industry, however, reveals a more complex picture.

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