The Federal Deposit Insurance Corp. (FDIC) released numbers showing Wisconsin banks continued to be in a healthy position through the third quarter of 2024, the Wisconsin Bankers Association (WBA) reports. While residential real estate lending dipped slightly over the prior year, farm lending held steady, and commercial lending increased. Deposits increased year over year (3.53%), due in part to the high interest rates offered on certificates of deposit (CDs) and money market accounts. The Q3 2024 net interest margin of 3.18% is a slight decrease over the prior year (3.19%) but an increase over the prior quarter (3.14%). Wisconsin banks remain well capitalized.Â
Notable indicators include:Â
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Residential real estate loans decreased slightly year over year (-2.34%).
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Inventory continues to be very limited, and homeowners who refinanced at low interest rates during the pandemic have little incentive to move. Seasonal trends in housing sales played into the decrease from the prior quarter (-11.70%) with spring typically being the most popular time to move in Wisconsin.Â
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Commercial lending saw modest growth year over year (2.50%) and quarter over quarter (1.19%) as the Fed began easing interest rates in September.Â
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Farm loans held steady year over year (-0.29%) and increased quarter over quarter (4.68%) as farmers sought to upgrade equipment, make capital improvements, or manage operational costs affected by tighter margins.Â
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Past-due loans were elevated year over year (19.30%) and quarter over quarter (6.55%) as inflation and the high cost of living impacts borrowers. While banks continue to monitor credit quality, the current level of past-due loans remains above recessionary levels.
Editor’s note: A previous version of this story has been updated to attribute the summary of the recent FDIC data to WBA.
