“Building reserves is slow and painful – releasing them, pure pleasure. US banks have released more than $100bn of loan loss reserves over roughly the past four years, according to data from the Federal Deposit Insurance Corporation, as the credit crisis has receded. In the first quarter of 2010 versus the third quarter of last year, net charge-offs fell more than three quarters. The loan loss releases have been a welcome supplement to bank earnings as the US economic recovery has not been strong enough to boost loan growth and interest rates.

“Building reserves is slow and painful – releasing them, pure pleasure. US banks have released more than $100bn of loan loss reserves over roughly the past four years, according to data from the Federal Deposit Insurance Corporation, as the credit crisis has receded. In the first quarter of 2010 versus the third quarter of last year, net charge-offs fell more than three quarters. The loan loss releases have been a welcome supplement to bank earnings as the US economic recovery has not been strong enough to boost loan growth and interest rates.”

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