: Bank earnings fell 11.3% in second quarter from prior quarter after impact of three failed banks: FDIC

The failure of three banks in early 2023 pushed bank earnings down 11.3% in the second quarter compared to the prior quarter, according to the Federal Deposit Insurance Co.’s quarterly report released Thursday. Combined profit from 4,645 commercial banks and savings institutions fell $9 billion to $70.8 billion, including the effects of on acquirers’ incomes of their acquisition of Silicon Valley Bank, First Republic Bank and Signature Bank, the FDIC said. Breaking out this impact, profit would have been about flat from the first quarter. “Declines in noninterest income, reflecting the accounting treatment of the acquisition of three failed institutions, lower net interest income, and higher provision expenses were the drivers of the decline in net income,” the FDIC said.  The KBW Nasdaq Bank Index BKX was down 0.6% in recent trades, while the Financial Select Sector SPDR ETF XLF is down by 0.1%.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.