CBA and Beacon Economics Release California Banking Intelligence Report

The California Bankers Association (CBA) and Beacon Economics have released an ninth California banking report that examines important issues currently affecting California’s banks and the overall economy. The report is authored by Chris Thornberg, Ph.D., and founding partner at Beacon Economics. This report analyzes bank lending data for California through the first quarter of 2016, finding that banks exceeded previous record levels, as total outstanding loan value reached $937 billion in the first quarter of this year*. Outstanding loans grew by 6.8% year-over-year in California, slightly less than the 7.3% growth throughout the U.S. Among the report’s key findings:
  • Outstanding construction loan value grew by 18.5%, primarily driven by a continuously strong year in the single-family residential market.
  • Outstanding C&I loan value grew by 13.9%, showing ill effects from what is transpiring in the oil market.
  • Loans to individuals, which includes credit cards and auto loans, grew the least over the year, yet have grown by 34% since the fourth quarter of 2013 – more than all categories except construction.
  • Consumer loans, a category that includes credit card and auto loans, grew at almost 2.4% over the year, yet have grown 34.4% since the first quarter of 2014.
  • The state’s banks remain in good health. The loan delinquency rate has improved to 1.13% compared to 1.60% a year ago.
*This report utilizes a unique database constructed by Beacon that provides a more holistic picture of lending in the state that includes both loans made by California-based banks, as well as an estimate of lending in the state made by financial institutions not headquartered in California. Beacon estimates that the volume of lending in California is much higher than the figures reported by the FDIC on California-based banks, as the nation’s five largest banks are technically  based outside of California and not included in the FDIC’s analysis, but have a significant portion of their operations based in California.
Please contact Beth Mills to schedule a media interview with the study authors.
About the California Bankers Association (CBA)
Established 125 years ago, the California Bankers Association (CBA) is one of the largest state banking trade associations in the country. CBA leads the way in developing relevant legislative and educational solutions to some of California’s more pressing financial and banking issues, including financial empowerment, identity theft, financial privacy, and financial elder abuse. CBA’s membership includes the majority of California’s commercial, industrial and community banks and savings associations. For more information, visit www.calbankers.com.
About Beacon Economics, LLC
Beacon Economics, LLC is an independent economic research and consulting firm with offices in Los Angeles and the San Francisco Bay Area. The firm delivers economic analysis and data sites that help their clients make informed, strategic decisions about investment, growth, revenue, policy, and other critical economic and financial issues. Their nationally recognized forecasters were among the first to predict the collapse of the housing market and foretell the onset and depth of the economic downturn that followed. Core areas of expertise include economic and revenue forecasting, market and industry analysis, economic impact studies, economic policy analysis, and international trade analysis.