BANKING & FINANCE - March 10, 1993

Banks Earn Record $32.2 Billion: Low interest rates on deposits helped the nation’s banks earn a record $32.2 billion last year, prompting regulators to all but declare an end to the industry’s crisis. The Federal Deposit Insurance Corp. said the country’s 11,461 commercial banks earned $8.2 billion in the fourth quarter, pushing the annual profit well past the old record of $24.8 billion, set in 1988. In 1991, banks earned $17.9 billion. In addition to the favorable interest rate conditions, banks had fewer loans go bad. For the first time since 1978, charge-offs--the amount of loans declared a loss--fell, decreasing by $7.3 billion from the year before to $25.5 billion.