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Index of Schedules
DirectoryNarratives
WTC Tribute
Department and Industry Response to 9/11 Attacks
150th Anniversary and Celebration
Employee Recognition / Awards
State of the Financial Industry
Holocaust Claims Processing Office
Criminal Investigation Bureau
Enforcement Actions
Banking Development Districts
"On the Road"
Predatory Lending
Governor Pataki Addresses the Banking Department Staff
Banking Board Membership
Office Locations
 

State of the Financial Services Industry

The year 2001 was marked by a significant turning point in the nationís economy. Following an unprecedented period of prosperity, the economy slipped into recession during March. The national unemployment rate rose progressively, from a low of 3.9% in October 2000 to 5.8% in December 2001, a 6-1/2 year high. Real gross domestic product (GDP), a measurement of the nationís output, turned negative in the third quarter, declining 1.3% at an annual rate.

A major shift in economic performance has important implications for the condition of the banking industry. During a recession, there is a tendency for banking organizations to experience erosion in the quality of assets, a drop in loan demand, and reduction in net income. However, it is important to note that New York State-chartered banks entered the year with strong capital cushions and therefore were relatively well positioned to weather the economic downturn.

Further, the Federal Reserve acted aggressively to counter the slowdown in the economy. In a series of eleven reductions, the targeted overnight Federal funds rate declined from 6.5% to 1.75% by year end, a cumulative decline of 475 basis points. The favorable interest rate environment provided a major stimulus to residential mortgage lending.

Supervised Banking Institutions
Regulatory Safety and Soundness Ratings

Bar Graph showing that Supervised Institutions received largely satisfactory regulatory safety and soundness ratings for the years 1999, 2000, and 2001.

 

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 Tribute to World Trade Center Victims | Department and Industry Response to 9/11 Attacks | 150th Anniversary Celebration | Employee Awards | State of the Financial Services Industry | Holocaust Claims Processing Office Accomplishments | Criminal Investigations Bureau Accomplishments | Enforcement Actions | Banking Development Districts | The Superintendent's Travels Throughout New York State | Predatory Lending | Governor Pataki's Address to the New York State Banking Department Staff | Banking Board Membership | Schedules | Office Locations
NYS Banking Department