As reflected in the FDIC’s fourth quarter 2011 Quarterly Banking Profile, C&I lending is largely responsible for recent aggregate loan growth. During 2011, C&I loans grew $161 billion, or nearly 14 percent, followed by growth in Other Loans of $55 billion or 21 percent. For some types of lending, growth did not occur until the second half of 2011. For example, although 1-4 family residential mortgage balances declined nearly $22 billion in 2011, they grew $49 billion
or 2.7 percent during the last six months of the year. Consumer loans also expanded during the same period, up $18 billion or 1.4 percent.
Again, based on Call and Thrift Financial Report data, loan growth has a pronounced geographic component. Some sections of the country appear to be having more success with loan growth than other areas. During 2011, more than half the institutions in several energy-producing states, along with those in the Great Plains and Northeast, reported loan growth while the remaining states had less than 50 percent of their institutions expanding loan balances during the year (see Map).
Overall Survey findings indicate that most institutions materially growing their portfolios are doing so in a prudent manner. Specifically, for banks generating loan growth of at least 10 percent during 2011, the associated risk was characterized by Survey respondents as “high” at only 5 percent of the institutions. Examiners characterized the risk as “low” in approximately one-third of the Surveys and “medium” in more than 40 percent of the Surveys. The remaining institutions had not made significant changes in lending activity since the previous examination.