Profits at Georgia’s banks rose almost 5 percent last year despite a late-year dip in income at the state’s biggest bank, SunTrust. (AP Photo/John Bazemore)

Georgia bank profits grew in 2016 despite slowdown for biggest player

State-wide, Georgia’s 183 banks reported $3 billion in profits last year — a 4.8 percent increase over the previous year — from growing loan portfolios and higher interest rates.

The full-year results were a slowdown from three months earlier, when the state’s banks were reporting profit growth of 6 percent for the first nine months of the year.

Part of the late-year dip was the result of lower profits at Atlanta-based SunTrust Banks. Net income at the largest Georgia-based bank fell 3 percent in 2016, to $1.9 billion, depressed by higher expenses and set-asides for loan losses in the fourth quarter.

Still, the Georgia banking industry’s results reflect an improving economy and slowly rising interest rates, which helped the financial institutions earn more on their growing lending businesses.

“Georgia’s banking industry had a solid year in 2016 that tracked closely with the growing Georgia economy,” said Joe Brannen, president of the Georgia Bankers Association. “Loans are growing, which means people and businesses in our communities are getting funding that goes back into the economy to support more growth. As deposits climb, that reflects increased savings and financial stability for Georgia families.”

The trade association noted that total deposits in the state’s financial institutions increased by more than 5 percent to a record $252 billion, while loans increased 6 percent to $221 billion, their highest level since 2008.

The percentage of profitable banks in the state was 93 percent, up from about 90 percent a year earlier.

However, the industry continued to shrink last year as bigger banks gobbled up smaller ones, and one bank failed. The state had 194 banks at the end of 2015, 11 more than a year later, while industry employment also declined slightly in 2016, from 42,833 to 42,732, according to the Federal Deposit Insurance Corp.

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