Montana banks remain strong

By The Associated Press - 11/26/2008

GREAT FALLS (AP) — The state's banks remain strong despite the national financial downturn, Montana's banking

commissioner said.

"Our Montana banks are strongly capitalized,

capably managed and have made consistently strong loans, which is why they're not having the same

problems as banks in some parts of the country," Annie Goodwin said Tuesday.

The Federal Deposit Insurance Corp. on Tuesday announced that the number of banks in trouble nationwide increased by about

50 percent to 171 in the third quarter, and that

commercial banks and

savings institutions nationwide suffered a 94 percent drop in third-quarter

profits.

Montana officials say that because the state's banks are stable, they are able to increase assets and make solid loans.

"All in all, Montana's commercial banks look good," said Steve Turkiewicz, chief executive officer of the Montana Bankers Association. "Our banks total assets and loans continued to grow this quarter, which showed they are lending money and working with customers in Montana."

The assets of Montana's 74 commercial banks were worth $18.3 billion on

Sept. 30, up $1.4 billion from the same time a year ago.

Turkiewicz said Montana banks also showed higher returns on assets and investments than the national average.

"Part of the reason is that Montana didn't feel the housing bubble and burst felt in many regions of the country," he said, noting that while housing prices grew by as much as

20 percent a year in some parts of the country, growth rates in Montana were

4 percent to 5 percent.

"Our banks were more conservative and didn't have the demand for the troublesome subprime loans," he said.

Montana also lagged behind much of the nation in experiencing the

economic downturn, but it's beginning to affect the state, Turkiewicz said. He noted the projected state budget surplus for the next two years fell from more than $800 million to about $300 million.

"But our Montana banks are well positioned to

withstand the economic slowdown," he said.

Goodwin said she was "cautiously optimistic about the future of banks and financial institutions in Montana. The banking environment remains strong and solid."

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Information from: Great Falls Tribune, http://www.greatfallstribune.com