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player ready...In an effort to alert the public to financial education resources, the Federal Reserve Bank of Chicago will host Money Smart Week beginning Monday.
The six-day program is intended to educate people from a variety of backgrounds on various topics, including how to raise a money-savvy child, handling finances during unemployment and home buying.
Various Chicago banks and library branches will host the seminars, some of which are targeted specifically toward children, Latinos and senior citizens.
The Chicago Public Library and area banks and community groups have spread the word about the seminars, and several public service announcements from the Fed have aired.
Still, the Fed is unsure how many people will attend activities during the week, which officials hope will become an annual event.
The idea for Money Smart Week sprang from a special Fed advisory council of various financial firms, schools and community groups. They found that plenty of financial information is available, but that most people are not aware it exists, said Liz Handlin, manager of external affairs for the Chicago Fed.
“You should be paying just as much attention to your financial health as your physical health,” Handlin said.
Bad loans: The U.S. banking industry’s net loan charge-offs grew by an alarming 55 percent in 2001, according to Weiss Ratings Inc., a Florida firm that rates and analyzes financial-services companies.
Loan losses during the year were $38.8 billion for banks and thrifts, up from $25.1 billion in 2000. The charge-offs in 2001 topped the industry’s previous record of $37.7 billion in 1991, during the savings-and-loan crisis.
About 43 percent of the nation’s banks and thrifts registered an increase in charge-offs.
“If most banks would bite the bullet and recognize most of their non-performing loans [past-due loans that have not yet been charged off], we wouldn’t be nearly as concerned,” said Martin Weiss, chairman of Weiss Ratings.
“However, non-performing loans also rose sharply, implying still another round of large charge-offs in 2002,” he said.
Non-performing loans jumped 28 percent in 2001, to $62.5 billion from $48.8 billion in 2000. That tops the nearly 27 percent increase in 2000, which followed a small 2.9 percent rise in 1999.
At year-end 2001, non-performing loans represented 9.4 percent of the industry’s capital and reserves, the highest level in eight years.
Despite increases in provisions for future loan losses, banks and thrifts posted a record profit of $87.5 billion in 2001, up 6.8 percent from $81.9 billion in 2000, Weiss Ratings said.
Without a $5.1 billion boost in non-recurring gains from the sale of securities, industry profits would have totaled $82.4 billion, a 1.7 percent decline from the adjusted $83.8 billion recorded the previous year.