Wisconsin Banks In Good Health Heading Into 2024

New data from the Federal Deposit Insurance Corporation shows Wisconsin banks remained in good health through the third quarter of this year.

Year-over-year lending increased in all categories, including farm loans, demonstrating the responsiveness of banks to meet their customers’ needs, according to the Wisconsin Bankers Association.

“Banks continue to be trusted partners in helping individuals, families, and businesses meet their financial goals,” says WBA President and CEO Rose Oswald Poels. “As has been the case for several quarters — inflation, interest rates, and geopolitical issues remain concerns heading into 2024.”

Farm loans increased both year over year (10.30 percent) and quarter over quarter (7.54 percent) as farmers looked to upgrade equipment, make capital improvements, or expand.

Other Economic Indicators:

Bank deposits slightly increased both year over year (0.59%) and quarter over quarter (0.95%). Net interest margin has held steady at 3.19% year over year, and capital levels are healthy.

Residential loans continued to grow, both year over year (25.19%) and quarter over quarter (15.38%). With low inventory, homes continue to sell quickly. Despite interest rate increases, rates remain relatively low in historical context.

While commercial lending increased year over year (2.36%), it decreased slightly quarter over quarter (-1.61%), showing waning economic confidence of business owners.

Credit quality weakened as inflation, interest rate hikes, and slowed income growth have made it more difficult for borrowers to pay back their loans.