Louisiana banks and thrifts are highly regulated and have nothing in common with the mess that is unfolding in other parts of the country, bankers say.
“Anyone concerned about their local bank or thrift should talk to the bank’s management to find out for themselves the condition,” said Louisiana Bankers Association Executive Officer Robert Taylor on Thursday.
As of June 30, 166 banks and thrifts insured by the Federal Deposit Insurance Corporation were operating within the state. Domiciled in Louisiana are 135 state chartered banks, 26 national banks, 18 federal thrifts and eight state chartered thrifts.
Additionally five FDIC-insured banks with significant operation in Louisiana are domiciled outside Louisiana.
Of those state-chartered banks, Taylor said loans and deposits are up, capital levels are high and Louisiana ranks 43rd in the nation in home foreclosures. He said local banks never approved bad loans and past due loans are as low as ever.
“Local banks have been exempt from the mortgage crisis,” Taylor said. “Most banks are doing quite well. For one time, it’s good that we are heading in the opposite direction of the rest of the nation.”
Taylor credits local bank presidents for their decision-making. He believes they have learned from the banking and economic crises in the late 1980s and early ’90s and know how to handle both good and bad situations.
“Management expertise has really paid off,” he said.
Florida Parishes Bank President Ronnie Fugarino said the local economy will likely not feel much of an impact from the Wall Street crises, and that local residents should just have faith in the banking and market system.
“It will work,” he said. “In the long run the market will recover and our outlook is still very good. Tangipahoa has never taken any huge steps forward, but also never any huge steps backward. Always steady growth.”
Return on average assets is a measure of bank and thrift profitability. As of June 30, 2008, ROAA of FDIC-insured banks domiciled in Louisiana, was .95 percent while the national return on average assets for all FDIC insured banks was much lower at .35 percent. For Louisiana domiciled FDIC-insured thrifts ROAA was .47 percent, while the national ROAA for all FDIC insured thrifts was 1.11.
For Louisiana domiciled FDIC-insured banks, loans grew by 3.73 percent during the second quarter with increases in all categories: real estate loans, commercial loans farm loans, consumer loans and other loans. Total loans also increased at Louisiana’s FDIC insured thrifts.
Louisiana domiciled FDIC-insured banks and thrifts also increased their total deposits as people continue to feel safe and secure with their money in FDIC insured Louisiana banks and thrifts.
curious wrote on Oct 2, 2008 5:41 PM:
1) The groups being regulated WILL ALWAYS TELL YOU THEY ARE HIGHLY REGULATED. IT MEANS NOTHING. If you would have asked that question on Wall Street four weeks ago. What do you think Wall Street would have told you? Mr. Taylor's association is responsible for keeping regulations to a minimum.
2) What does Mr. Taylor believe local bank presidents learned from earlier banking and economic crises that other bankers did not learn? You don't say; he doesn't say. Yet he wants our faith.... In fact, you never once explained WHY "local banks have been exempt from the mortgage crises". Did they not make loans?
You want me to believe for the second time in a week that local experts are more expert than national experts. I will tell you what I told you then: Possible; not likely.
I will agree with this: The hallmark of Tangipahoa growth has always been that it is slow and steady. Mr. Fugarino is correct. But let's all remember this in the good times, not just rely on it for comfort during the bad times. "