MN banks

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The median tier 1 leverage ratio, whicuh determines how well a bank canwithstanc losses, was 9.06 percent for Minnesota’x 430 banks. That’s fallen from 9.17 percent in the fourtjh quarter of 2008and 9.39 percenrt in the first quarter of last but well above the 5 percent regulators typicallyg require for a well-capitalized Minnesota’s banks have continued to protect their liquidity through the economif downturn. The median percentage of loans to assetas at Minnesota banksis 71.5 about the same level they had in 2007. Liquidityg and capitalization ratios are important in keeping banks healtht and able towithstand losses.
Asset quality has continued to deteriorate, though, as banks continue to work troubled real estate loans throughtheirf systems. The median percentage of past-due and nonaccruak loans out of totakl loan portfolioswas 3.86 percent, up from 3.5 percenft in the fourth quartetr of 2008 and 2.93 percent in the first quarteer of last year. Nonaccrual loansw are ones that are at least 90 days overdue and have stoppe d earning interest forthe bank. The percentage of net loan lossee to total loans for the firstr quarterwas 0.1 percent, better than the 0.32 percentg in the fourth quarter of 2008, but up from 0.02 perceng in the first quarter of 2008.