Las Vegas Sun

October 22, 2017

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Banks in distress: Foreclosure properties mount

Problem loans and foreclosed properties are weighing on Las Vegas banks’ balance sheets, according to third-quarter filings released Nov. 24 by the Federal Deposit Insurance Corp.

As a whole, banks had a 39.7 percent increase in foreclosed properties since the quarter that ended June 30. Foreclosed properties were $218.5 million as of Sept. 30, up from $156.3 million June 30.

Loans that banks were no longer collecting on increased 16.8 percent to $1.36 billion as of Sept. 30 from $1.17 billion June 30.

The numbers don’t reflect large national banks, such as Wachovia or Citibank, who have headquarters in Southern Nevada, but don’t specify Las Vegas figures.

“Nevada banks continue to be distressed, but will continue to work through it,” Nevada Bankers Association CEO Bill Uffelman said.

Among the 34 commercial banks in Nevada, 79.4 percent are unprofitable as of Sept. 30, up from 57.9 percent the year before, a second FDIC report released Nov. 24 said. In September 2007, just 25 percent of commercial banks were considered unprofitable, the report said.

Net loss increased 113.2 percent, from $1.16 billion in September 2008 to $2.46 billion on Sept. 30. The drop in income is even more significant when compared with September 2007 with net income of $8.21 billion, the FDIC said.

Banks’ deposits increased 5.2 percent year over year, from $759.7 billion to $799.5 billion. The report shows that banks have regained ground lost in September 2008 and have returned to almost the level in September 2007, when banks reported $798.7 billion in deposits.

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