Fed annual report to Congress shows shrinking number of banks, rising lending, deposits – but lower equity capital

There were 109 fewer commercial banks at the end of last year compared to the end of 2021, the Federal Reserve said Friday in its 2022 annual report to Congress, with the lion’s share of that change resulting from banks converting into branches.

However, the report also showed that there were 15 new commercial banks created last year; another 21 of the banks ceased operations, the report shows.

The report shows there were 4,115 commercial banks at the end of 2022, compared to 4,224 at the end of 2021. Most of the banks (87.7%) in 2022 were affiliated with bank holding companies (BHCs).

The commercial banks, according to the report, held $16 trillion in loans and investments (up 9.6%) , $16.7 trillion in deposits (up 5.7%) and $2 trillion in equity capital (down 6.97%).

109th Annual Report of the Board of Governors of the Federal Reserve System