South Dakota Banks Making Big Money

All right, turkey's out of my system—let's get back to work!

While I was enjoying the grand American consumer bacchanalia in Lincoln, I read that Nebraska banks are having a great year. The FDIC says so far in 2010, Nebraska's banks have made $460 million in profit, their best three-quarter showing since 1993.

But they're pikers compared to South Dakota. The FDIC's State Banking Performance Summary says South Dakota's banks have made $7.97 billion in profit through three quarters. That's up 55% from the $5.14 billion profit posted at this point last year and up 6.5% from the September 2007 figure right before the economy went to heck.

Also worth noting: employment at South Dakota banks boomed by 50,000 full-time equivalents, a jump of nearly 28% from September 2009's 180,759 to the current 230,578.

Now hold on: jobs in the financial sector in South Dakota hardly number 30,000. Those FDIC-SBPS numbers cover all FDIC-insured institutions in South Dakota, and that apparently means FDIC counts al employees of those firms here and in other states. Look just at state-chartered institutions, and you find 4,347 full-time equivalents—well below the 5,086 FTEs at the beginning of the panic in September 2008, but up at least from last year's 3,855. Profits among the state-chartered institutions are up as well, at $123 million so far this year, up 26% from the same time in 2009.

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Looking nationally and historically, 149 U.S. banks have failed so far this year. That beats last year's total of 140. We also have a lot more "problem institutions"—FDIC is keeping an eye on 860 banks, compared to 702 "problem institutions" last year.

One more interesting note: following the savings and loan crisis and the early-1990s recession, FDIC had over 22,000 employees. Under the Bush Administration, FDIC's workforce was slashed to less than 5,000. Currently FDIC has 8,027 employees to insure our deposits and keep an eye on our banks.