The profitability of the U.S. commercial banking industry remained robust in 2000, but returns on equity and on commercial bank assets fell back somewhat from the peaks reached in 1999. Aggregate earnings were depressed in 2000 by a substantial one-time charge at a single large bank and by the ongoing restructuring at one of the nation's largest bank holding companies. Even after accounting for those special factors, however, overall profitability was still down in 2000. The major factors in the decline were a continuation of the narrowing in net interest margin that dates from the extraordinarily high levels of the early 1990s, a significant increase in loan-loss provisions, and a notable slowing in the growth of noninterest income.
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