Through the first six months of 2001, FDIC-insured commercial banks reported record earnings of $39 billion, surpassing the first half of 2000 by $4.8 billion (14.1%), which translates into an annualized return on assets of 1.24%. Capital gains realized through security sales accounted for more than 5% of first-half earnings. Downward pressure on core earnings continued; the net interest margin fell to 3.86% at midyear, a drop of 9 basis points (bp) from the end of 2000 and 13 bp lower than the first half of 2000.
Suggested citation: "Commercial Banks," Federal Reserve Bank of Cleveland, Economic Trends, no. 01-10, pp. 16, 10.01.2001.