7/31/2019 Fast Facts: Fortress Balance Sheets

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Fast Facts: FORTRESS BALANCE SHEETS

Week 1 of 3: Health of the Financial Services Industry

Our banks are on a much stronger basis than they were at the time of the last economic crisis, and they have built their capital base and their equity base and worked through a lot of their toxic assets. Presidential Candidate Mitt Romney, CBS Face the

Nation, June 17, 2012.

FACT: Bank capital is at its highest levels in history , according to new FDIC data. Banks currentlyhold nearly $1.6 trillion in capital, and the average Tier 1 capital ratio set a new record of 13.28 percentin the first quarter of 2012. New rules such as Basel III and capital surcharges for systemicallyimportant financial firms will increase capital requirements further.

FACT : Insurance firms capital and surplus are at all-time highs despite an increase in unexpectedexpenses from natural disasters in 2011. Moreover, insurance companies had record payments toindividuals who suffered from these disasters.

FACT: Large banks have increased their business lending , according to FDIC data . Net loans and

leases grew by $40 billion during the first quarter for banks with over $10 billion in assets.

FACT: Loan quality has improved across all loan categories and all bank sizes . Loan losses declinedfor a seventh consecutive quarter, and noncurrent loans reached a three-year low, according to the FDICQuarterly Banking Profile for Q1 2012.

FACT: Banks have tripled on-hand liquidity since 2008 to meet unexpected funding needs, accordingto SNL Financial. In the first quarter of 2012, the on-hand liquidity ratio rose to an all-time high of 23percent.

FACT: Bank failures are at their lowest level in three years , and the number of problem institutions

is now at its lowest level since 2008, according to the FDIC.

FACT: Net income has returned to pre-crisis levels. FDIC-insured commercial banks and savingsinstitutions reported $35.3 billion in net income for first quarter 2012. This represents a $6.6 billion(22.9 percent) improvement over first quarter 2011 results.

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Financial Services HOTLINE: If you have questions about this topic or any other issue facingfinancial services, please reach out to Abby McCloskey, Director of Research at the Financial Services

Roundtable, at 202-589-2531 or Scott Talbott, Senior Vice President of Government Affairs, at 202-289-4322.Learn more about the Financial Services Industry at www.OurFinancialFuture.com .

OurFinancialFuture.com is continuously updated to bring you the most useful information about theindustry in real-time.

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