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U.S. banks earned more from April through June than during any quarter on record, aided by a steep drop in losses from bad loans.
The Federal Deposit Insurance Corp. says the banking industry earned $42.2 billion in the second quarter, up 23 percent from the second quarter of 2012. CNNMoney additionally reported Thursday that the nation’s biggest banks are expected to hand out more in compensation in 2013 than they did in 2009 -- the final year of the recession -- including $23 billion in bonuses.
On the same day the FDIC announced the record profits, fast food workers across the nation walked off the job in protest of what they see as low wages and poor treatment. The demonstrators are demanding a $15-per-hour minimum wage and protections against retaliation for joining a union.
Hourly wages for nonfarm workers fell 3.8 percent in the first quarter, the biggest quarterly drop since the Bureau of Labor Statistics began tracking wage growth in 1947. Yet CEO pay continues to steadily rise, with total compensation growing by 876 percent between 1978 and 2012.
The federal minimum wage of $7.25 per hour has not been raised since 2009, and number of workers living off that (or less) more than doubled between 2007 and 2012, according to The New York Times.
Banks' losses on loans tumbled 30.7 percent from a year earlier to $14.2 billion, the lowest in six years. And bank lending increased 1 percent from the first quarter. Greater lending helps boost consumer and business spending, leading to more jobs and faster economic growth.
Still, the FDIC report shows that the largest banks continue to drive the industry's profits while smaller institutions have struggled. Banks with assets exceeding $10 billion make up only 1.5 percent of U.S. banks. Yet they accounted for about 82 percent of the industry's earnings in the April-June quarter.
Those banks include Bank of America Corp., Citigroup Inc., JPMorgan Chase & Co. and Wells Fargo & Co. Most have recovered with help from federal bailout money and record-low borrowing rates.
The Federal Deposit Insurance Corp. says the banking industry earned $42.2 billion in the second quarter, up 23 percent from the second quarter of 2012. CNNMoney additionally reported Thursday that the nation’s biggest banks are expected to hand out more in compensation in 2013 than they did in 2009 -- the final year of the recession -- including $23 billion in bonuses.
On the same day the FDIC announced the record profits, fast food workers across the nation walked off the job in protest of what they see as low wages and poor treatment. The demonstrators are demanding a $15-per-hour minimum wage and protections against retaliation for joining a union.
Hourly wages for nonfarm workers fell 3.8 percent in the first quarter, the biggest quarterly drop since the Bureau of Labor Statistics began tracking wage growth in 1947. Yet CEO pay continues to steadily rise, with total compensation growing by 876 percent between 1978 and 2012.
Banks' losses on loans tumbled 30.7 percent from a year earlier to $14.2 billion, the lowest in six years. And bank lending increased 1 percent from the first quarter. Greater lending helps boost consumer and business spending, leading to more jobs and faster economic growth.
Still, the FDIC report shows that the largest banks continue to drive the industry's profits while smaller institutions have struggled. Banks with assets exceeding $10 billion make up only 1.5 percent of U.S. banks. Yet they accounted for about 82 percent of the industry's earnings in the April-June quarter.
Those banks include Bank of America Corp., Citigroup Inc., JPMorgan Chase & Co. and Wells Fargo & Co. Most have recovered with help from federal bailout money and record-low borrowing rates.
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