Iowa banks post strong quarter

Iowa banks ended the third quarter of 2015 with higher loan volume and deposits, but the impact of federal banking regulations is viewed by the Iowa Bankers Association as hampering loan growth.

The state's 315 chartered banks provided more than $51.5 billion by the end of the third quarter, up 8.4 percent from $47.5 billion in the third quarter of 2014, according to data provided by the Federal Deposit Insurance Corp.

Deposits totaled $62.5 billion on Sept. 30, up from $60.1 billion on Sept. 30, 2014. Net income increased to $696 million on Sept. 30 from $640 million at the end of the third quarter of 2014.

Loan volume increased in all categories - real estate, farm, commercial and consumer. Construction and land development loans posted the biggest increase, up 16.8 percent from the year prior.

Loan quality also improved in the third quarter with noncurrent loans at 0.61 percent on Sept. 30, down from 0.78 percent at the same point last year.

Nonperforming loans - those 90 days or more past due and not accruing interest - were at 0.55 percent, down from 0.70 percent on Sept. 30, 2014.

John Sorenson, president and CEO of the Iowa Bankers Association, said in a news release that the Dodd-Frank Wall Street Reform and Consumer Protection Act has resulted in 'fewer banks and less credit availability than would otherwise be available.”

'The pace of loan growth has been hampered by excess regulations,” Sorensen said, 'Congress has an opportunity to fix some of the negative provisions of this law - and its 13,000 pages of implementing regulations - before we close out 2015. We urge them to do so.”

Iowa banks were actively preparing for new Dodd-Frank mortgage rules that became effective in October, amending the process for providing mortgage loan disclosures. The Dodd-Frank Act, passed by Congress in 2010 in response to the 2008 recession, implemented broad and complex legislation impacting the entire financial services industry.