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'No one has ever lost a penny of FDIC insured deposits, and the system in place to protect depositors in times of economic stress is working well.'
Joe Brannen
Ga. Bankers Association |
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December 19, 2008
The president and CEO of Georgia Bankers Association offered reassurances about the stability of the banking system, as evidenced by the protection of deposits and BB&T's assumption of those deposits.
"No one has ever lost a penny of FDIC insured deposits, and the system in place to protect depositors in times of economic stress is working well," Joe Brannen said.
The economy has affected Georgia's banking industry.
"The prolonged housing downturn continues to affect our economy in general, and some of our banks that have focused heavily on the real-estate development and building industries are unquestionably hurting. Five Georgia banks have been closed since August, mostly due to the real estate market difficulty," he said.
Based on the most current FDIC data, non-performing bank loans in Georgia are more than double the national average. Those non-current loans have risen to more than $7 billion. Foreclosed real estate properties are up significantly.
"It is also important, however, to be clear that 96 percent of banks operating in Georgia meet the criteria for being well capitalized by regulators and have adequate reserves on hand to weather the current stresses to the economy," Brannen said.
"And, despite a tough environment, Georgia's banks are making loans. Through the end of the third quarter, total loans and leases at Georgia's banks and savings institutions were about $8 billion higher than through the same period in 2007," Brannen said.
Georgia bankers are being cautious, but borrowers with good credit, reasonable debt and solid cash flow can qualify for loans.
The FDIC's increased insurance limits up to $250,000 per individual account is protecting customers' deposits.
"If your deposits at your bank are fully covered, there's no need for you to take unnecessary, drastic actions with your deposit accounts," he said.
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