Even as mortgage activity slowed, bank earnings soared to a fifth consecutive record.
Net income during the fourth quarter for commercial banks and savings institutions insured by the Federal Deposit Insurance Corp. reached $32.9 billion, falling 5 percent from record earnings in the third quarter but $1.7 billion better than the comparable quarter in 2004, according to a press release.
But annual net income totaled $134.2 billion, surpassing the record set in 2004 by $11.8 billion, the FDIC reported.
"What we see is a banking industry that is fundamentally strong but continues to face some important challenges ahead," said FDIC Acting Chairman Martin Gruenberg in the written statement.
While residential mortgage loans, home equity loans and mortgage-backed securities grew $24.0 billion in the fourth quarter, it was about half less than $66.7 billion and the smallest quarterly increase in these assets in two years, according to the report.