Federal Reserve Bank
of San Francisco Federal Reserve Bank
of San Francisco

First Glance 12L

These quarterly reports highlight key indicators of 12th District banking conditions.

  • Third Quarter 2023: Strains on Banks’ Funding and Margins Eased

    The 3Q23 issue of First Glance 12L notes that the pace of net interest margin compression and nonmaturity deposit attrition eased among the District’s banks. But rising interest rates increased net unrealized losses on banks’ bond investments. Commercial real estate remained an area of focus given lending concentrations and market conditions.

  • Second Quarter 2023: Rate and Funding Shifts Pressured Bank Earnings

    The 2Q23 issue of First Glance 12L notes that although most of the District’s banks remained profitable, net interest margins narrowed amid an ongoing shift towards costlier funding sources. District job growth was solid and home prices gained traction. At the same time, given market conditions and lending concentrations, commercial real estate merited continued close monitoring.

  • First Quarter 2023: Banks Faced a Challenging Funding Landscape

    The 1Q23 issue of First Glance 12L notes that banks faced a challenging funding landscape during the quarter. Although still solidly profitable, the combination of rising short-term interest rates, competitive pricing pressures, and shifts in funding mix compressed banks’ margins. Meanwhile, job and housing markets improved slightly but commercial real estate markets remained under pressure.

  • Fourth Quarter 2022: Economic and Liquidity Pressures Intensified for Banks

    The 4Q22 issue of First Glance 12L notes cooling job and real estate market conditions in the West. Among the District’s banks, funding costs increased notably as nonmaturity deposit runoff picked up, deposit competition intensified, and banks shifted to pricier funding sources.

  • Third Quarter 2022: Banks Continued to Navigate a Rising Interest Rate Environment

    The 3Q22 issue of First Glance 12L notes cooling job and real estate market conditions in the District. Among the District’s banks, rising interest rates benefitted earnings, but weighed on bond portfolio values and influenced growth and funding trends. 

  • Second Quarter 2022: Hiring and Lending Expanded despite a Clouded Outlook

    The 2Q22 issue of First Glance 12L notes further improvement in the District’s job markets despite rising interest rates and declining consumer and business confidence. In addition, median loan growth among District banks — excluding Paycheck Protection Program loans — accelerated to nearly 16% year-over-year, the fastest pace among all twelve Federal Reserve districts and the strongest rate since 2006.

  • First Quarter 2022: Risks Persist in an Uncertain Economic Environment

    The 1Q22 issue of First Glance 12L notes further improvements in the job, housing, and commercial real estate markets despite a January surge in COVID-19 cases. Among District banks, quarterly loan growth and profits as well as on-balance sheet liquidity and risk-based capital ratios remained sound but eased slightly. Loans continued to perform well, but bankers’ expectations about the economic outlook dimmed.

  • Fourth Quarter 2021: The Recovery Continued but a New Year Brings New Uncertainties

    The 4Q21 issue of First Glance 12L notes the continued recovery of jobs, tight housing markets, and improved but uneven commercial real estate market conditions. Meanwhile, banks’ average loan growth accelerated, more than offsetting declining Paycheck Protection Program (PPP) balances. Quarterly profits continued to benefit from PPP fees and low provision expense burdens, but not to the same degree as 3Q21.

  • Third Quarter 2021: Job and Non-PPP Loan Growth Accelerated, but Downside Risks Persist

    The 3Q21 issue of First Glance 12L notes improved hiring, but also intensifying concerns about labor availability, supply chains, and inflation. Meanwhile, District banks reported accelerating traditional loan growth, offset by declining Paycheck Protection Program (PPP) balances. PPP forgiveness also triggered earlier recognition of PPP fees, especially among community banks. All this and more are discussed in a new, re-designed report format.

  • Second Quarter 2021: Recent Virus Transmission May Weigh on the Recovery

    The 2Q21 issue of First Glance 12L notes that economic activity picked up during the quarter, but subsequent virus transmission may weigh on the recovery. District bank earnings were stable despite net interest margin pressures, partly because better-than-expected asset quality constrained provision expenses. The “Spotlight” feature explores fraud trends.