Banks, thrifts see jump in late loan payments

U.S. banks and thrifts suffered the biggest increase in late loan payments in 17 years as more homeowners fell behind on mortgages, the Federal Deposit Insurance Corp. said Wednesday.

The amount of loans more than 90 days past due rose 10.6% to $66.9 billion in the period ended June 30, the largest quarterly increase since 1990, the FDIC said in its quarterly banking profile.

“The bottom line for banks is that the credit environment continues to be more challenging now than it has been in recent years,” FDIC Chairwoman Sheila Bair said.

“Current conditions,” she added, “do underscore that regulators must be vigilant and banks need to follow sound risk-management practices.”

Still, she said, the banking industry is well capitalized, profitable, well diversified and “in a very good position as we are going through this period of market readjustment.”

The FDIC insures deposits at 8,615 institutions with $12.3 trillion in assets.