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Lending, net income soar to new heights, so why not profitability?

Posted by Elliott Welton
Lending, net income soar to new heights, so why not profitability?

The American Bankers Association released a statement on the FDIC’s second quarter bank earnings report last week, and results were very promising for the health of the economy. Bank lending hit a new milestone of $8 trillion, and net income soared to near-record highs; however, profitability continues to lag for the banking industry. ...

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Breakeven analysis - when can you start making money

Posted by Sageworks
Breakeven analysis - when can you start making money

For a Chief Financial Officer of a company, profitability is sure to be front-of-mind. Even if you have a great product and are generating consistent sales, many business owners and key decision makers can find themselves surprised that their business is still not making them any money. According to the US Small Business Administration, breakeven analysis is a great tool to determine the point at which your business is generating revenue at least equal to expenses. Any additional revenue can at this point be considered profit. It is critical if you are just starting your business to identify and incorporate startup costs into this calculus, as initial upfront investments can be significant and will affect net sales revenue needed to break even. ...

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The profit squeeze is on for some financial institutions

Posted by Mary Ellen Biery
The profit squeeze is on for some financial institutions

It’s getting harder for community banks to generate positive operating leverage, American Banker said in a recent review of third-quarter results posted by the industry. Regulators have expressed concern that banks may take on inappropriate levels of risk as they seek ways to remain profitable in a low-interest-rate environment that also has increasing competition for commercial loans. ...

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Basel III Capital Rules: Delay is a victory for community banks

Posted by Billy Burnet
Basel III Capital Rules: Delay is a victory for community banks

The new proposed capital and liquidity requirements from Basel III pose a major threat to the survival and profitability of community banks, according to Edgar Ortiz, President and CEO of Strategic Analytic Solutions LLC. In part 1 of this guest column, Ortiz provides insight into how the delay of the Basel III rules was a victory for community banks across the country. ...

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Private companies boost margins despite modest inflation

Posted by Mary Ellen Biery
Private companies boost margins despite modest inflation

Private-companies in the U.S. this year are more profitable now than at any point in the last decade despite slowing sales growth, according to a preliminary analysis of data from Sageworks. Their increasing profitability is impressive given the modest inflation seen at the producer level in recent years, as measured by the Producer Price Index. ...

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Factors that affect small business credit

Posted by Sageworks
Factors that affect small business credit

Many small private businesses are finding it challenging to access financial resources for growth at a time when lenders are still cautious and facing pressure to avoid risky loans. Many businesses already know this, because they have seen their borrowing requests rejected by a lender. Others may be considering starting a loan application and want to ensure the business is best prepared to receive an approval. ...

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