For small banks, both nationally and regionally, commercial and industrial (C&I), real estate, and consumer loan totals increased by double-digit rates from the first quarter of 2014. For large U.S. banks, C&I lending increased from 2014, and real estate lending stalled. With net interest margins holding nearly constant, the increased loan activity boosted banks' profitability.
Adding to the positive lending environment for banks this quarter, nonperforming loans as a share of total loans (NPL ratio) decreased for all classes of loans. Banks had already adjusted to the new capital requirements that went into effect in 2015. Lastly, house prices in the tristate area rose more slowly than in the rest of the nation.
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