*  *  *  The banking industry enjoyed a very good year in 2003, one in which banks were able to adapt to a changing environment and still generate record profits. Several factors contributed to this favorable setting: low interest rates, a boom in mortgage banking and deposit-gathering, and favorable trends in market-sensitive businesses as the year went on.
We are just getting our first look at year-end financial information from Call Reports. Although the figures are still preliminary, there are some interesting findings. In 2003, for the first time, insured commercial banks earned $ billion dollars. These impressive profits were 14 percent higher than in 2002, which to that point was itself a record year for earnings.