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Tuesday, November 9, 2010 - 8:19am

Ga. Banks Still "Troubled"

A new report shows the number of troubled banks in the state grew over the last three months. But bank officials say those numbers don’t necessarily give a full picture of an institution’s health.

The so-called “Texas ratio” measures a bank’s troubled loans compared to cash reserves. A study by a national financial services firm shows another three fell into the ‘troubling’ ratio category, to nearly 80.

The head of the Georgia Bankers Association, Joe Brannen, acknowledges the still rough economic waters for banks.

“In some markets we are seeing some positive signs, but in other markets around the state we’re not seeing that. These numbers are a reflection of those values of real estate, those values of properties for sale. And those values haven’t found their bottom yet.”

But Brannen says this ratio only accounts for one aspect of a bank’s health, and it's not a measure used by regulators.

“Most banks are now profitable, they are able to make loans. We’re making more loans today than we did this same time last year. So there are some positive signs out there, we just have an economy that’s still struggling to find its bottom.”

Georgia leads the country in bank failures with 46 since 2008 -- 16 this year. But Brannen banks are “closer to the end” of rough waters than the beginning.

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