WASHINGTON, May 24 (UPI) -- U.S. banks earned $35.3 billion in profits in the first three months of the year, a federal regulator said.
The Federal Deposit Insurance Corp., said profits rose by $6.6 billion from the first quarter of 2011, a 22.9 percent rise.
Average return on assets rose above 1 percent for only the second time out of the past 19 quarters.
Income for banks, however, has improved compared to the same quarter of the previous year for 11 consecutive quarters, the FDIC said.
In the first quarter, 67.5 percent of the country's banks and savings institutions reported year-over-year gains in earnings with only 10.3 percent of banks losing money in January through March, the lowest level since the second quarter of 2007.
In a sharp turnaround, only 16 banks out of 7,307 failed in the first quarter, the smallest number of failures since the fourth quarter of 2008, when 12 banks failed.
The agency's ominous "Problem list," which keeps track of banks in trouble, dropped from 813 banks to 772 in the quarter. Total assets among "problem" banks dropped from $319 billion to $292 billion in the quarter.