Financial Services - August 2008Data and Analysis
Financial market conditions remained constrained in August. Tight lending conditions continued to exert pressure on consumers and businesses in the District. Credit card lending remained high, though the pace of growth slowed slightly in the second quarter. Deposit growth at Sixth District banks was marginally positive in the second quarter after three quarters of negative growth. Commercial and industrial lending by Sixth District banks was strong in the second quarter.
The percentage of seriously delinquent loans in the subprime mortgage segment remained high in the first quarter of 2008 but appeared to be leveling off in all states in the region other than Florida: 12.0 percent (up from 11.9 percent in the fourth quarter of 2007) in Alabama; 22.2 percent (up from 17.5 percent) in Florida; 14.6 percent (up from 13.6 percent) in Georgia; 13.6 percent (up from 13.2 percent) in Louisiana; 16.2 percent (down from 16.4 percent) in Mississippi; and 12.4 percent (up from 12.2 percent) in Tennessee.
Data for banks headquartered in the Sixth District indicate that loans secured by real estate grew by 2 percent on a year-over-year basis. Credit card debt extended by District banks again showed strong growth in the second quarter of 2008 compared to a year earlier and has been growing since the first quarter of 2007.
Commercial and Industrial Lending
Data for banks headquartered in the Sixth District indicate that commercial and industrial lending increased by 12.4 percent in the second quarter of 2008 compared to a year earlier.