Banks' Fourth Quarter Loss is Greater than Previously Believed

Federal regulators said Friday that the banking industry in the fourth quarter lost nearly $6 billion more than it had previously acknowledged:

The Federal Deposit Insurance Corporation (FDIC) revised the Quarterly Banking Profile for the fourth quarter of 2008 because of significant amendments that were received shortly after the issue’s original release on February 26. Updated results reflect substantially higher charges for goodwill impairment in the fourth quarter, which affected the industry’s aggregate net income and total equity capital. As a result of the amended reports, the industry’s fourth quarter net loss widened from $26.2 billion to $32.1 billion. Net income for all of 2008 was revised from $16.1 billion to $10.2 billion. The decline in the industry’s total equity capital in the fourth quarter increased from $3.7 billion to $10.1 billion, but the additional goodwill write-downs had no effect on the industry’s regulatory capital, because goodwill is not included in regulatory capital.