AXP confirms profit outlook for FY08

Credit card co American Express affirmed its profit outlook for this year. The economic forecast remains uncertain but AXP believes it will not be as bad as earlier downturns of 1990 or 2001.

American Express's U.S. card business set aside $881 million for losses in the first quarter, a 52 percent increase from the year earlier. Debt considered uncollectible rose to 5.5 percent of all loans from 4.3 percent in the fourth quarter.
click to enlarge


















source: American Express Rises After Affirming 2008 Forecast (Update2)
By Hugh Son, Bloomberg
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aI3OaxqurKzI

FASB gets tough on accounting by reassessing FAS 140

It seems that in every scandal Walls Street is involved in, and shareholders have to pay for, financial accounting plays a major role. The most recent financial crisis saw securitization, originate to distribute and off balance sheet financing like special-interest entities (SIV) or qualified special-purpose entities(QSPE) go sour and posing systemic risk to the global financial system. These financial engineering tricks are going unnoticed under the radar as long as everything is working fine. They indeed serve investors and the industry if only they stay free from abuse as guaranteed by the regulators. This guarantee however is very fragile and can not be trusted.

As we have posted recently investors should still be concerned about possible "sour" investments that are hidden away in the murky accounting universe of financial institutions. Of special interest is accounting standard FAS 140. There is much talk about enforcement of regulation in this post crisis environment but trust in both industry and regulators will be difficult to restore. FASB, in an attempt to close the barn door after the horse is already three blocks away, is reassessing FAS 140.

The IMF, The Bank of England, the Securities and Exchange Commission, the President’s Working Group and other groups have jumped on the reform bandwagon. And since March, FASB staffers have been gathering data and assessing whether risk was masked under current accounting rules used by banks for securitized investment vehicles, collateralized debt obligations and other toxic instruments currently languishing in an illiquid market.

Now comes a rather under-the-radar bombshell. FASB has decided to “eliminate the concept of the QSPE” (qualified special-purpose entities) in the revised financial-accounting standard, FAS 140, and also will “remove the related scope exemption from FIN 46R,” says FASB director of technical activities Russ Goldin. FASB is sill studying actual implementation and disclosure issues, but it seems pretty clear those unpriceable, lamentable assets are headed for the balance sheets.

If implemented this would mean banks have to take on their balance sheets investments worth hundreds of billions of dollars further constricting their leverage. The case for investing in financial stocks is indeed very feeble.


read also: The lack of transparency in standard bank operations is still concerning
Thursday, May 22, 2008
http://manonthestreet64.blogspot.com/2008/05/lack-of-transparency-in-standard-bank.html

source: FASB Lobs a Balance-Sheet Bombshell
By Joseph Rosta, U.S. Banker | June 2008
http://www.americanbanker.com/usb_article.html?id=20080527YPS0NT46&

Gartman - Commodity bubble bursting!?

Dennis Gartman, of the Gartman Letter, thinks the CFTC will change the definition of “hedger”, which could send oil 25% to 40% lower "very quickly". Gartman would be very careful about being outright long commodities.

Gartman also thinks that Bernanke's "dollar support" will bring commodity prices down.

"We are facing a tidal wave of selling,'' Virginia-based Gartman wrote in his daily newsletter today. Even agriculture prices "may come under pressure following Dr. Bernanke's dollar support.''

click for video about LEH and Commis











video: Commodities Rapid Fire
A look at commodities and discussing Lehman Brothers' financial troubles, with Dennis Gartman, The Gartman Letter founder
http://www.cnbc.com/id/15840232?video=760686450

Another day another hearing

Today, in a Senate panel hearing there was consensus among the testimony that specs are driving up commodity prices and oil prices in particular. Michael Greenberger, a professor at the University of Maryland School of Law and a former CFTC official, gave passionate testimony supporting this view. He was "outraged" about the fact that WTI crude contract is traded on US exchange away from CFTC oversight. This could be changed overnight by revoking a no-action letter in which the CFTC declined to regulate trading on West Texas Intermediate oil contract on the London and Dubai exchanges. This simple fast step could take off as much as 25% to 40% from the current oil price over night, in Greenberger's opinion. Some of his constituents giving testimony shared this opinion.

George Soros insisted that his prepared remarks might have been misunderstood in that respect the underlying fundamentals support somewhat current high oil prices. He declined to specify the amount of speculation in oil markets because he is not involved with oil trading. Soros nevertheless thinks that the rise in oil prices and other commodities has "some of the earmarks of a bubble".

Former CFTC official Greenberger advocated strong punishment and severe jail time for the crime of manipulating commodity markets and in doing so criticized the CFTC for doing too little to deter this kind of behavior.

suggested steps to reign in speculators:
close "Enron loopholes" by strict regulation of WTI contracts
more transparency and position limits on non-commercial speculation
increase margin requirements above level of stock margins (>50% from current 2%)

Light Crude July 08


source: Lawmakers look to rein in crude oil speculation
By Chris Baltimore, Reuters
http://www.reuters.com/articlePrint?articleId=USN0341230520080603

read also: Consumers first - oil futures later
Friday, May 16, 2008
http://manonthestreet64.blogspot.com/2008/05/consumers-first-oil-futures-later.html

ABC consumer confidence advances for the first time in three month

Consumer confidence advanced for the first time in three months in an unusual one-week gain in the week to June1, lifting from its all-time low in 22 years of weekly polls. The ABC News Consumer Comfort Index moved up 6 points to -45 on its scale of +100 to -100; it’s increased by 6 or more points only eight times before.

But it’s still dreadful:
Last week the CCI set a record low, -51, and it’s been at -45 or lower for five weeks straight.

Improvement in the buying climate from neg. 62 to neg. 54, related to the government's rebate checks, is behind this slight advance in consumer confidence.

See the complete results, tables here.

click to enlarge historic chart

















source: Confidence Backs Off Historic Low
ABC NEWS CONSUMER INDEX – 6/1/08
http://abcnews.go.com/images/PollingUnit/m080601.pdf

Happy Birthday! - Euro

The euro, the currency of 15 countries and 320 million people, is celebrating its 10th birthday. The common currency undoubtedly is a huge success and American economist Martin Feldstein's prediction from 1997, "that divisions created by the euro might lead to war between nations using the currency", has not materialized. Nevertheless the good times seemed to be over at least for now, but there is absolute no reason to lose faith in the ability of the EZB to navigate rough waters.




source: An Impossible Dream, the Euro Finds Its Way
By CARTER DOUGHERTY and MARK LANDLER, NYT, June 3, 2008
http://www.nytimes.com/2008/06/03/business/worldbusiness/03euro.html?_r=1&partner=rssnyt&emc=rss&pagewanted=print

Regulators start to offer rating services

Regulators prove again that they are behind the curve by doing the unthinkable. Holy cow! We are witnessing a revolution in the bond insurance market: Regulators will start selling a service to rate muni bonds held by bond insurers caught in a downdraft of the credit crunch. The bonds in question did not have a rating only had the wrap from the insurers (those bonds were insured by bond insurers). Regulators are handing out the ratings because they believe that the underlying creditworthiness of the municipalities that issued the bonds would be substantially higher than a junk rating. (which would be otherwise issued if bond insurers were downgraded to junk). This offers one more piece into the picture of regulators socializing losses and privatizing profits.
One question remains: Who is now regulating the regulators??

Dinallo on the issue:
There is about a half a billion dollars of bonds that life insurance companies hold that are wrapped by the muni bond insurers.

We are using a more pragmatic based approach using the securities valuation office.

Credit worthiness of these bonds has not changed at all....regulators to come in look at the books of the insurance companies and say this is not actually a junk and we are going to give you the proper capital call around it so that you don't have to take a big haircut.

On the naked naked CDS issue (see prior post): (we are going) to work through!
click for video










video: Insurance Regulators Step Up
Insight on regulators service for muni bonds caught in the credit crunch, with Eric Dinallo, New York State Insurance Department superintendent and CNBC's Melissa Francis
http://www.cnbc.com/id/15840232?video=759599080

read also: Eric Dinallo wants to regulate the CDS market
Tuesday, May 13, 2008
http://manonthestreet64.blogspot.com/2008/05/eric-dinallo-wants-to-regulate-cds.html

Europe's Banks Lag U.S. on Risk Disclosure, FSF Says

The Financial Stability forum is dissatisfied with the risk disclosure of European banks. A Bloomberg report also mentioned the possibility of a greater impact on Europen financial institutions from the current market turmoil.

Banks in Europe are lagging behind U.S. lenders in disclosing risk, damaging investor confidence, according to Svein Andresen, secretary general of the Financial Stability Forum.

European lenders face criticism for failing to reveal the extent of their losses from the U.S. subprime mortgage crisis even after disclosing $199.6 billion of writedowns, more than the $165.7 billion reported by U.S. financial institutions. Zurich-based UBS AG, HSBC Holdings Plc in London and Dusseldorf- based IKB Deutsche Industriebank AG account for three of the five worst markdowns by institutions worldwide.

"Some of the major banks have yet to make adequate disclosures in areas that the market place and counterparties consider critical to judge these banks creditworthiness and risk exposures,'' said Andresen. "This is highly detrimental to confidence.''


source: Europe's Banks Lag U.S. on Risk Disclosure, FSF Says
http://www.bloomberg.com/apps/news?pid=20602093&sid=aljCQhqbWtpU&refer=rates

O.C. homebuying losing streak will end soon

Demand for O.C. homes is improving according to market watcher Steve Thomas at Re/Max Real Estate Services in Aliso Viejo, CA. Housing demand is at a 24 month high. Skeptics are saying that surging bank REO inventory dumped on the market is responsible for pent-up demand.

Every two weeks, Thomas also calculates “market time,” a benchmark of how many months it theoretically takes to sell all the inventory in the local MLS for-sale listings at the current pace of pending deals being made. By this Thomas logic, it would take 5.61 months for buyers to gobble up all homes listed for sale last Thursday at the current pace of deals vs. 5.82 months two weeks earlier and vs. 8.86 months a year ago. A key reason: the latest count deals in escrow of 2,720 is up 173% vs. Jan. 19’s wintertime low. Here’s a look at listings, new deals to buy homes and Thomas’ market time in month…












source: Demand for O.C. homes now passing ‘06 pace
OCregister, posted by Jon Lansner/O.C. Register columnist, June 2nd, 2008
http://lansner.freedomblogging.com/2008/06/02/demand-for-oc-homes-now-passing-06-pace/

March 2008 CPPI down 2.3 percent according to Moody's

The Moodys/REAL commercial property index (CPPI) is a periodic same-property round-trip investment price change index of the U.S. commercial investment property market based on data from MIT Center for Real Estate industry partner Real Capital Analytics, Inc (RCA).

The latest results of the Moodys/REAL CPPI show a decrease of 2.3% in March for the all properties national index. All four national property sectors are down from their peak prices of 2007 (with peaks in different quarters of last year for different property types). Retail is down the most from its peak, -5.7%, while offices and industrial are down the least, by -2.0% and -2.3% respectively. Apartments are in the middle, with price declines of -3.4% since that asset type's peak a year ago in the first quarter of 2007.

Here is the Reuters press release:
Moody's said prices of retail properties have dropped 5.7 percent from their peak in 2007, compared with declines of 3.4 percent for apartment buildings and 2.3 percent for industrial real estate, respectively. Office property prices are down 2 percent from their peak, according to quarterly data.

On a monthly basis, commercial property prices fell 2.3 percent in March, the most since Moody's began collecting the data in 2000. Values were 2.6 percent below their October 2007 level, but still up 0.9 percent from a year ago, Moody's said.

The impact of a slowing economy and forecasts of a 20 percent drop in commercial property prices from their peak by Moody's and JPMorgan Chase & Co in the first quarter led to steep price drops on securities backed by commercial real estate. However, prices on commercial mortgage-backed securities have since climbed amid expectations the selling overstated the losses that would occur.

Fitch Ratings said delinquencies on CMBS rose slightly, to 0.35 percent in April from 0.33 percent in March. Fitch analysts said they are most concerned with retail and hotel properties even though delinquencies in those sectors decreased marginally.

click to enlarge



























source: US Commercial property price fall most since 2000 -Moody's
Reuters, Mon May 19, 2008 11:34am ED
http://www.reuters.com/article/marketsNews/idUSN1928306620080519

source: Moodys/REAL Commercial Property Index (CPPI): May Update
May 30, 2008
http://web.mit.edu/cre/research/credl/rca.html

Spike in foreclosures goes beyond subprime

click to enlarge




















source: The Trouble in Housing Trickles Up
By NELSON D. SCHWARTZ, NYT, June 1, 2008
http://www.nytimes.com/2008/06/01/business/01town.html

Foreign demand for US corporate credit has collapsed

The acute phase of risk management in the current credit crisis has passed, so it is time to ask questions. To find out what went wrong is important for the healing process. We can draw already one conclusion: Risk was supposed to be dispersed but it wasn't.

Brad Sester's Blog quotes Blackrock's Peter Fisher:
“The idea of risk dispersion is nice in theory, but in practice it depends on who risk gets dispersed to. It turns out that we dispersing risk it into strong hands who could hold it through volatility. Rather we were dispersing it to weak hands who couldn’t hold it, and ended up adding to the volatility.”

Exposure to murky subprime mortgages was widely held by the Street. Portfolios from overseas investors were big buyers but sponsored by American- and European institutions who funded their purchases with short term dollar borrowing. The authorities here and abroad are to blame for not having understood the transfer of the liquidity pressure to the banking system according to Donald Kohn.

The result of the implosion in the subprime market, though, aren’t in doubt: “international” demand for US corporate credit has collapsed.

click to enlarge

















source: Risk wasn’t dispersed
Brad Sester's Blog: Follow the money
Posted on Friday, May 30th, 2008 by bsetser
http://blogs.cfr.org/setser/2008/05/30/risk-wasn%e2%80%99t-dispersed/

source: Vice Chairman Donald L. Kohn
At the Federal Reserve Bank of New York and Columbia Business School Conference on the Role of Money Markets, New York, New York, May 29, 2008
http://www.federalreserve.gov/newsevents/speech/kohn20080529a.htm

Kohn Signals Wall Street May Get Permanent Access to Fed Loans

He is at odds on this issue with his boss, at least for now:

The Federal Reserve should return to adjusting reserves mainly through purchases and sales of the safest and most liquid assets as soon as that would be consistent with stable, well-functioning markets. In fact, several of the Federal Reserve's new programs are designed to be self-liquidating as markets improve.

The public authorities need to consider several difficult issues with respect to access to the discount window. One is the circumstances under which broker-dealers should be permitted to borrow in the future. One possibility would be to confine such borrowing to circumstances in which the Federal Reserve judges that the stability of the financial system is at risk--as we did in March. Another would be to grant broker-dealers the same sort of regular access enjoyed by commercial banks.

Unquestionably, regulation needs to respond to what we have learned about the importance of primary dealers and their vulnerabilities to liquidity pressures. We need to confront the difficult questions I raised earlier about the scenarios in which it is appropriate to rely on central bank liquidity and the scenarios in which such reliance is inappropriate. And we need to ensure that supervisory guidance regarding liquidity risk management is consistent with the way we answer those questions. Whether broader regulatory changes for broker-dealers are necessary is a difficult question that deserves further study.


source: Vice Chairman Donald L. Kohn
At the Federal Reserve Bank of New York and Columbia Business School Conference on the Role of Money Markets, New York, New York, May 29, 2008
http://www.federalreserve.gov/newsevents/speech/kohn20080529a.htm

Is Congress helping to restrain insane energy speculation?

Consumeraffairs.com features an interesting headline, "Did Wall Street Wreck The Economy?". The first part focused on the obvious subprime debacle, but I was interested in the second part referring to an initiative in Congress to break down on excessive speculation in energy markets. The recently passed ominous farm bill, vetoed by the Bush administration, contains a little publicized provision (we have reported in a prior post) that is allowing federal regulators to have more oversight and control over oil futures trades. Rep. John Larson, a democrat from CT, recently spoke with the NYT about his plan to propose legislation that would essentially ban over-the-counter trading of energy futures by traders who don’t plan to take physical delivery of the commodity. While this bill has little chance of passing it still represents the current mood about sky high energy prices among policymakers in Washington.

But this time, it’s Wall Street and the newly public commodity exchanges that are sharing the Congressional spotlight. Senate Democrats have already proposed legislation that would impose stiffer margin requirements on energy trading. Senator Jeff Bingaman, chairman of the Senate Energy and Natural Resources Committee, wants to tighten oversight of energy trading that takes place over the counter or outside of exchanges like the Nymex, which is regulated by the Commodity Futures Trading Commission.

“But there is a widespread feeling amongst the leadership in Congress and the rank and file that something has got to be done in this area,” Larson says. “And this situation requires bold action.”

Let's hope this is not just election talk and we get some real results that help to restrain insane energy speculation.



source: Energy Speculators Draw the Heat
By NELSON D. SCHWARTZ, NYT, May 25, 2008
http://www.nytimes.com/2008/05/25/business/25maker.html?_r=1&scp=3&sq=Larson&st=nyt&oref=slogin

source: Did Wall Street Wreck The Economy? Congress, regulators start to connect the dots
By Mark Huffman, ConsumerAffairs.com, May 29, 2008
http://www.consumeraffairs.com/news04/2008/05/wall_street.html

read also: CFTC Announces Multiple Energy Market Initiatives
Thursday, May 29, 2008
http://manonthestreet64.blogspot.com/2008/05/cftc-announces-multiple-energy-market.html

read also: The hunt is on - speculators beware!
Wednesday, May 21, 2008
http://manonthestreet64.blogspot.com/2008/05/hunt-is-on-speculators-beware.html

Long Island car sales up in the first quarter 2008

Long Islanders purchased more cars in the first quarter of 2008. Vehicle sales were up 10.3 percent compared to a year earlier. That is better than the national trend which saw registrations falling by 6.9 percent. In Long Island sales for both categories, pickups/SUVs and cars, gained. Relative low unemployment and stable home prices have kept the auto market healthy in the New York region. This trend seems to be broken in April.

Indeed, Jeffrey Foltz, a local market analyst for the Greater New York Automobile Dealers Association, said there are signs the car business locally slowed down in April. And some dealers say credit is tight, especially for customers who are "upside down" -- owing more on the present cars than they are worth in trade.


source: New car sales climb on LI, despite decline nationally
BY TOM INCANTALUPO, newsday.com, May 29, 2008
http://www.newsday.com/business/ny-bzcars0530,0,7259305.story

We truly live in interesting times - see Case/Shiller HPI

as the Case/Shiller HPI shows:

Now Robert Shiller, an economist at Yale University and co-inventor of the index, has compiled a version that stretches back over a century. This shows that the latest fall in nominal prices is already much bigger than the 10.5% drop in 1932, the worst point of the Depression.
















source: America's house prices are falling even faster than during the Great Depression
from Economist.com, May 29th 2008
http://www.economist.com/displayStory.cfm?story_id=11465476

Ahead of the curve - States lead on climate change

A short documentary gives hope to a change in US leadership:
In the absence of strong U.S. federal leadership on climate change, citizens and elected officials across America are discovering reasons to be hopeful about the future of our planet, and are taking matters into their own hands. This short documentary celebrates America at its best--and shows why Washington should be paying close attention.

click for video
















source: Ahead of the curve - States lead on climate change
Sea Studios Foundation
http://seastudios.org/ahead2_video_wmp.php

CFTC Announces Multiple Energy Market Initiatives

Crude oil fell 7 USD from an intraday high of $133.12 to close at $126.25 in NYMEX trading today. This record drop despite a record decline in weekly crude inventory can be attributed to a timely CFTC announcement of "multiple energy market initiatives". The CFTC allert by record high oil prices and a Senate pannel hearing finally steps into action and is increasing oversight of energy futures markets.

CFTC Acting Chairman Walt Lukken and Commissioners Michael Dunn, Jill Sommers and Bart Chilton announced following agreements:

I. Expanded International Surveillance Information for Crude Oil Trading

• Immediately implementing expanded information-sharing to provide the CFTC with daily large trader positions in the UK WTI crude oil contract;


• Extending trader information sharing to provide crude oil large trader position data for all contract months in the WTI contract, not just the nearby months;


• A near-term commitment to enhance trader information to permit more detailed identification of market end users;


• A near-term commitment to provide improved data formatting so trading information can be seamlessly integrated into the CFTC’s surveillance system; and


• ICE Futures Europe will notify the CFTC when traders exceed position accountability levels, as established by U.S. designated contract markets, for WTI crude oil contracts.

II. Increased Transparency of Trading in U.S. Energy Markets

• Improve Transparency for Energy Markets Index Trading Activity: The Commission will begin to require traders in the energy markets to provide the agency with monthly reports of their index trading to help the CFTC further identify the amount and impact of this type of trading in the markets.


• Review of Trader Reporting and Classification: The Commission will develop a proposal to routinely require more detailed information from index traders and swaps dealers in the futures markets, and to review whether classification of these types of traders can be improved for regulatory and reporting purposes.


• Examine Trading Practices for Index Traders: The Commission will review the trading practices for index traders in the futures markets to ensure that this type of trading activity is not adversely impacting the price discovery process, and to determine whether different practices should be employed.

III. Continuation of Ongoing CFTC Nationwide Crude Oil Investigation

LIGHT CRUDE OIL Jul '08















source: CFTC Announces Multiple Energy Market Initiatives
CFTC, May 29 2008
http://www.cftc.gov/newsroom/generalpressreleases/2008/pr5503-08.html

read also: The hunt is on - speculators beware!
Wednesday, May 21, 2008
http://manonthestreet64.blogspot.com/2008/05/hunt-is-on-speculators-beware.html

U.S. first quarter GDP revised higher to 0.9 percent

Weak points:
Consumer spending (durables and non durables down, services holding up for now)
Government expenditures on the State and local level (rising inflation and lower revenue squeeze purchasing power) and of course,
residential domestic investment (no signs of recovery there)

Merryl Lynch North American economist David Rosenberg notes that a key indicator of the domestic economy, final sales to domestic purchasers (GDP ex trade and inventories), remains negative at -0.1% QoQ (was -0.4%).

FDIC: bank earnings decline 46 percent in first quarter 2008

FDIC sees banking industry earnings declining by almost 50 percent, with loan loss provisions increasing and troubled loans accumulating (especially in real estate). Loans secured by 1-4 family residential properties declined for the first time since the fourth quarter of 2003, falling by $26.5 billion (1.2 percent). However, the industry still earned a total of $19.3 billion in the first quarter. This is surprising given all the doom and gloom in the forecast. A possible explanation is the fact that the four largest institutions are responsible for more than 50 percent of the shortfall. The restatements in fourth quarter earnings are not encouraging in that sense either.

QBP first quarter 2008:
Real Estate Troubles Hold Down Earnings
Deteriorating asset quality concentrated in real estate loan portfolios continued to take a toll on the earnings performance of many insured institutions in first quarter 2008. Higher loss provisions were the primary reason that industry earnings for the quarter totaled only $19.3 billion, compared to $35.6 billion a year earlier.

Restatements Shrink Fourth Quarter 2007 Profits Substantially
Industry earnings for the fourth quarter of 2007 were previously reported as $5.8 billion, but sizable restatements by a few institutions caused fourth quarter net income to decline to $646 million. This is the lowest quarterly net income for the industry since insured institutions posted an aggregate net loss in the fourth quarter of 1990.

Market-Sensitive Revenues Remain Weak at Large Institutions
In addition to the sharp increase in loan-loss provisions, lower noninterest income also contributed to the decline in industry earnings in the first quarter. Noninterest revenues fell on a year-over-year basis for a second consecutive quarter, declining by $1.7 billion (2.8 percent).

Charge-Off Rate Climbs to Five-Year High
Insured institutions charged-off $19.6 billion (net) during the first quarter, an increase of $11.4 billion (139.1 percent) over the first quarter of 2007. This is the second consecutive quarter of very high net charge-offs -- fourth-quarter charge-offs totaled $16.4 billion. The annualized net charge-off rate in the first quarter rose to 0.99 percent, more than double the 0.45 percent rate of a year earlier and the highest quarterly net charge-off rate since the fourth quarter of 2001.

Noncurrent Loan Growth Remains High
Even with the heightened level of charge-offs, the amount of loans and leases that were noncurrent (90 days or more past due or in nonaccrual status) rose by $26.0 billion (23.6 percent) in the first quarter, following a $27.0-billion increase in the fourth quarter of 2007.

Reserve Coverage Loses Ground
However, the growth in loss reserves was outstripped by the rise in noncurrent loans, and the industry’s “coverage ratio” fell for the eighth consecutive quarter, to 89 cents in reserves for every $1.00 of noncurrent loans from 93 cents at the end of 2007. This is the lowest level for the coverage ratio since the first quarter of 1993.

Growth in Credit Slows
Total loans and leases increased by just $61.4 billion (0.8 percent) during the quarter. Loans secured by real estate rose by $20.5 billion (0.4 percent), the smallest quarterly increase since the first quarter of 2003. Loans secured by 1-4 family residential properties declined for the first time since the fourth quarter of 2003, falling by $26.5 billion (1.2 percent).

click to enlarge















source: Quarterly Banking Profile, First Quarter 2008
FDIC
http://www4.fdic.gov/qbp/2008mar/qbp.pdf