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banking, South Dakota finance, commercial banks, loans


Over the recent seven year business cycle of 1988-94, South Dakota banks have seen their profitability improve significantly. This has contributed to a strengthening of the banks in the state and in their ability to meet the financial needs of their customers and communities. The data in this report show that while bank earnings have been strong, the gains have not been distributed evenly across banks of all sizes. The data also demonstrate the related differences in loan portfolios among the banks of varying size. This report describes the improved profitability, the sources of the improved profits, and the distribution of the improvement across various sizes of banks during these years. The report is intended to describe the banking system in the entire state. However, it omits data on a few of the largest banks. In some cases the omitted bank is a specialized bank not representative of the services available to South Dakota and in all cases the large size of these banks distorts the aggregate bank performance indicators. Therefore, to present a more meaningful description of the set of banks in the state, data for these large banks are omitted. Data omitted are those for Citibank South Dakota, First Bank South Dakota, First City Bank, Norwest Bank South Dakota, and Retailers National Bank. The data are presented for all banks with average assets no greater than $375 million in each year. As shown in Table 1, the total number of such banks ranges from 115 in 1992 to 128 in 1988. Data are also broken down for banks of various sizes as measured by their average assets each year. The asset size ranges were selected arbitrarily with the only criterion being to have approximately an equal number of banks in each size category with the exception of fewer banks in the largest size category.


Department of Economics, South Dakota State University

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