For IDC subscribers of the bank and thrift database, the deposit database can be sorted to focus your research.

 1.  The 150 largest banks and thrifts in domestic loans ($36.7 trillion) with time deposits less than 50% of loans (average 17%).  These large financial institutions from $714 billion in loans at Wells Fargo Bank to $3 billion at Berkshire Bank must increase time deposits dramatically over the next 3 years.

 2.  Largest 150 with positive loan growth and outstanding brokered deposits with negative growth in brokered and time deposits, had only 18% on average in time deposits as a % of loans and need to significantly expand time deposits.

 3.  Which banks and thrifts have positive loan growth, increases in time deposits, and strong growth in brokered deposits?

 4.  List of banks with positive growth in time deposits, greater than brokered deposits – - the active banks and thrifts in brokered CD’s.

 5.  Four quarterly databases answering four questions as to current institutions brokering CD’s and the banks and thrifts with the potential to dramatically increase brokered CD’s – - all for $500 per year.

 Contact Kevin or Trish at IDC Financial Publishing, Inc. info@idcfp.com or call 1-800-525-5457.

 IDC Financial Publishing, Inc. and the information we produce on financial institutions can help you make the right decisions on which institutions meet the safety and soundness guidelines of your company. We pride ourselves on the ratings and ratios we produce and are well known in the brokered certificate of deposit industry. Our information is also used by the federal government and its agencies as well as many states, municipalities and insurance companies to name a few.

IDC has all of the data that goes into publishing each of our books and more, available in an Excel format. The files are distributed via our secure download portal. Preliminary ranks and supporting financial ratios become available approximately five to seven weeks after the end of the reporting quarter. Final ranks become available approximately 15 days prior to the distribution of the print publication which is also included as part of the database subscription and contains documentation.

 Links to a few sample database products:

Bank Financial Quarterly Database

Savings Institution Financial Quarterly Database

Credit Union Financial Profiles Database

 To receive a quote for IDC’s database products, please click here and complete the Use of Service Statement. Upon completion, print, sign, and either scan and email to info@idcfp.com or fax to 262-367-6497 to receive a quote for the site services requested.

 To view IDC’s License and Subscription Agreement click here.

 If you have any questions you may reach us via email or at 800-525-5457.

The Architecture Billings Index Fell Slightly to 50.9 in January,

Indicating Flat Growth in Non-Residential Construction

• The sharp decline from 57.8 in June 2007 to a cycle low of 34.6 in January 2009, followed by 53.9 in December 2010 in the U.S. Architecture Firms “Work-on-the-Board” Billing Index defined the major recession in non-residential construction in 2009 and 2010, but forecasted potentially flat growth in 2012, as the index fell slightly to 50.9 by January (see table below).  The U.S. Architecture Billing Index leads private non-residential construction growth by 9-months to 1-year (see Chart I).
• The Architects Billing Index around 50, forecasts flat growth in private non-residential construction in the first half of 2012.  Combined with weak residential building, a decline in growth of total construction in 2009/2010 forecasted the severe recession.  A level of 50.9 in architectural billings forecasts flat growth in private commercial construction in 2012 (see Chart II).
• “Even though we had a similar upturn in design billings in late 2010 and early 2011, this recent showing is encouraging because it is being reflected across most regions of the country and across the major construction sectors,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “But because we still continue to hear about struggling firms and some continued uncertainly in the market, we expect that overall economic improvements in the design and construction sector to be modest in the coming months.”

U.S. Architecture Firms “Work-on-the-Board” Billing Index

*     3 month moving average due to small sample size

**    Multi-family

***  Low of 28.1 in Com/Ind Sector in November 2008

Every January the AIA research department uses a formula from the Department of Commerce that re-estimates ABI data based on seasonal factors resulting in a recalibration of recent figures.

 Chart I

Chart II

 A huge gap has opened in the early stages of economic recovery between big and small companies, with the former enjoying strong balance sheets, access to credit, and growing global markets, compared to the latter hurting from a lack of access to credit and reduced hiring plans, as sales volume remains weak.  Small business credit conditions, hiring plans, sales volume, and strengthening balance sheets depend on recovery in residential construction and consumer spending (see Chart IV).

 Small business credit conditions remained strong (above a negative from 1986 to 2007, allowing the Small Business Hiring Plans Index to remain positive (above a plus 5 – see Chart I).  The decline in small business credit conditions in late 2007 led by a year the decline in the Small Business Hiring Index.  Credit conditions fell to an all-time low of a negative16 in 2009and March 2010 and recovered to a negative 9 by January 2012 (scale left, Chart I).  The Hiring Plans Index, required to be a plus 5 or higher to indicate economic recovery, rose to a positive 7 by November 2011, but other indicators failed to support the increase and Hiring Plans fell to a positive 5 (scale right Chart I).

 ISM Non-manufacturing Employment Index increased to 57.4 in January 2012, forecasting 2.0% employment growth for this huge sector for 2012.  The Small Business Job Opening Index rose to 18 in January 2012, supporting the strong increase in ISM Non-manufacturing Employment (see Chart II).

 Michigan Confidence Index increased to 75.0 in January and must increase above 80 to support a sustained recovery.  The Small Business Optimism Index was 93.9 in January, down from the February peak of 94.5, and below the 100 level of sustained small business recovery (see Chart III).

Chart I

  Chart II

Chart III

 Small Business Credit Conditions Depend on Residential Construction

The decline below 50 in 2006 in the Home Builders (Sentiment) Market Index, measuring the sentiment of home builders and realtors, led by 12 months the decline in small business credit conditions in 2007 below recession levels (a negative 8 reading – see Chart IV).  The drop below a negative 8 in expected credit conditions led by 12 months the drop in small business hiring plans (see Chart I).

 In order for small business to recover, (1) the Credit Conditions Index must rise to a negative 8 from a negative 9 in January 2012, (2) the Hiring Plans Index must remain above a positive 5, (3) the Small Business Optimism Index needs to climb from 93.9 to 100, and (4) the job openings index must increase from 18 in January to the 20 level.  Modest growth in small business remains the forecast for 2012.

 Most important, the recent recovery in the Home Builders (Sentiment) Market Index provides support to improvement in Small Business (see Chart IV).

 Chart IV

Conclusion:

IDC’s blend of these sentiment indicators provides a confidence level of 45.5 in January 2012.  University of Michigan consumer sentiment rose to 75.0 in January on a scale around a center point of 80 (translates to 46.9 on a scale centering around 50).  The Architects Billing Index remained at 52.0 in December and the Home Builders Market Index increased to 25 in January 2012, both with a scale centering around 50.

 Over time, financial recovery is hoped to create economic recovery and growth in jobs.  At such time as Michigan sentiment rises above 80, U.S. Architects billings stays above 50, and the Home Builders Market index increases substantially toward 50, will the economy be in a sustained recovery.

 Chart I

  IDC Confidence Index is a Blend of Three Sentiment Indicators and Weights:

1)      University of Michigan Consumer Sentiment (75%)

2)      U.S. Architects Billing Index (15%)

3)      Home Builders Market Index (10%)

 An IDC Confidence Index above 50 forecasts an environment favorable to revenue growth, high and improving returns on equity, and superior earnings growth.  Positive confidence levels, over 50, lasted long periods, such as March 1982 to July 1990 and December 1992 to September 2007.  During these two periods, the S&P 500 rose 132.8% and 250.4%, respectively.  During periods with IDC confidence over 50, stock selection based on franchise value offered the best returns with IDC large cap S&P portfolios outperforming the S&P 500 by 50% from 1995 to 2007, and midcaps more than doubling the returns of the S&P 500 in the same period (see Appendix I).

 University of Michigan Consumer Sentiment (75%) (see Chart II)

The problem occurs when theUniversityofMichigan Sentiment Indexdeclines below 80.  The consumer, who accounts for 70% of GDP, is measured by theUniversityofMichigan Sentiment Index.  The lack of consumer confidence reduces sales and profits of companies doing business in theU.S.  The recession of 1979 to 1983 was forecast byUniversityofMichigansentiment declining below 80 to a low of 52, as interest rates rose to 20% or more, as the Federal Reserve attempted to control inflation.

Consumer confidence again fell below80 in 1990through 1993, but recovered above 80 for short periods in between.  Revenue and earnings growth were disrupted in the recession.  The collapse of consumer confidence in the 2000 to 2002 period was from a peak of over 110 to 80.  The bear market in technology stocks and September 11, 2001 shock failed to create a consumer recession.  Revenue and earnings growth continued, as did the relative performance of IDC’s stock selection using franchise values.  Three year total returns were positive over the 2000 to 2002 period (see Appendix I).

The major decline in theUniversityofMichigan Consumer Sentiment Indexto below 80 occurred in August and was confirmed in September 2007.  The economic engine of theU.S.was shut down, as consumer confidence fell to lows below60 in 2008and 2009.  Stock selection using franchise value was not as successful after the S&P 500 peak in October 2007.  Since IDC stock selection performed so well in the previous bull market, investors sold the favorable stocks to capture gains, as the stock market fell from over 1500 to 800 by November 21, 2008 (the first buy date from Fed liquidity or quantitative easing).

Stock markets in the previous periods of consumer confidence under 50 were controlled by the Federal Reserve reducing the Fed Funds rate.  In the 2008 and 2009 collapse in equities in a period of financial crisis with threat of deflation, quantitative easing was the method of choice by the Fed, which, in turn, controlled the prices of tradable assets (S&P 500).

U.S. Architects Billing Index (15%) (see Chart III)

The U.S. Architects Billing Index above 50 indicates more architects have increasing billings (sales) than decreasing, and it forecasts rising nonresidential construction.  Conversely, and index below 50 indicates a forecast of declining nonresidential construction.  The theory is “before you build, you must have an architect draw the structure”.

The recession of 2001 and 2002 had short periods of readings under 50.  In early 2008, the U.S. Architects Billing Index fell sharply below 50, bottoming at 33 in early 2009.  A level of 50 or above is required for the decline in commercial property prices to increase.  Only then would nonresidential construction begin a sustained recovery.

 Home Builders Market Index (10%) (see Chart IV)

The Home Builders Market Index measures the sentiment of home builders and the realtors traffic of consumers viewing homes.  A reading over 50 coincided with each housing boom.  A drop below 50 forecast a housing decline. In 1989 and 1990 and, again, after mid 2006, the decline in the index below 50 forecasted a housing recession.  A sustained recovery in housing requires an index level over 50, not foreseen in the next year or maybe longer.

Chart II

 Chart III

Chart IV

Chart V

 1.  Growth in brokered time deposits is in its own recession.

 2.  Yet, 293 banks and thrifts are growing brokered deposits with the dollar change in time deposits greater than brokered deposits.  The median annual increase in brokered deposits was $1.9 million, the largest $2.5 billion.

 3.  Growth in brokered deposits normally requires positive time deposit growth, which in turn, primarily depends on positive loan growth.  With 2,957 banks and thrifts, or 40% of all institutions, increasing loans year-over-year in the 3^rd quarter of 2011, only 27%, or 2,036 institutions, added time deposits, and a limited number of 863 institutions, or 11.5%, added to brokered deposits, indicating future growth in brokered time deposits could accelerate dramatically.

4.   IDC’s database, providing levels and growth in loans, brokered and time deposits and more, can be sorted to answer:

 a)      which banks and thrifts are increasing brokered deposits

b)      which banks and thrifts with strong loan growth are good candidates for acceleration in future growth in brokered deposits

 5.  Which banks and thrifts are good prospects for placing brokered deposits?

Contact Tom Vandermus at IDC for further information regarding this new product.  tomv@idcfp.com or 1-800-525-5457

 A huge gap has opened in the early stages of economic recovery between big and small companies, with the former enjoying strong balance sheets, access to credit, and growing global markets, compared to the latter hurting from a lack of access to credit and reduced hiring plans, as sales volume remains weak.  Small business credit conditions, hiring plans, sales volume, and strengthening balance sheets depend on recovery in residential construction and consumer spending (see Chart IV).

 Small business credit conditions remained strong (above a negative from 1986 to 2007 allowing the Small Business Hiring Plans Index to remain positive (above a plus 5 – see Chart I).  The decline in small business credit conditions in late 2007 led by a year the decline in the Small Business Hiring Index.  Credit conditions fell to an all-time low of a negative16 in 2009and March 2010 and recovered to a negative 9 by December 2011 (scale left, Chart I).  The Hiring Plans Index, required to be a plus 5 or higher to indicate economic recovery, rose to a positive 6 by December 2011, but other indicators failed to support the increase (scale right Chart I).

 ISM Non-manufacturing Employment Index increased to 49.4 in December 2011, forecasting 0.5% employment growth for this huge sector for 2012.  The Small Business Job Opening Index decreased to 15 in December 2011 and remains slightly above recession lows, which averaged 12 in 2010 (see Chart II).

Michigan Confidence Index increased to 69.9 in December and must increase above 80 to support a sustained recovery.  The Small Business Optimism Index was 93.8 in December, down from the February peak of 94.5, and below the 100 level of sustained small business recovery (see Chart III).

Chart I

Chart II

 Chart III

Small Business Credit Conditions Depend on Residential Construction

 The decline below 50 in 2006 in the Home Builders (Sentiment) Market Index, measuring the sentiment of home builders and realtors, led by 12 months the decline in small business credit conditions in 2007 below recession levels (a negative 8 reading – see Chart IV).  The drop below a negative 8 in expected credit conditions led by 12 months the drop in small business hiring plans (see Chart I).

 In order for small business to recover, (1) the Credit Conditions Index must rise to a negative 8 from a negative 9 in December 2011, (2) the Hiring Plans Index must remain above a positive 5, (3) the Small Business Optimism Index needs to climb from 93.8 to 100, and (4) the job openings index must increase from 15 in December to the 20 level.  A recession in small business remains a stronger possibility, especially with the recent readings in the most important Small Business Optimism Index falling to near cycle lows of 2008-2010.

 Most important, the weak trend in the Home Builders (Sentiment) Market Index provides only modest support to improve Small Business Expected Credit Conditions (see Chart IV).

 Chart IV

 (See Chart I)

Conclusion:

IDC’s blend of these sentiment indicators provides a confidence level of 41.6 in December 2011.  University of Michigan consumer sentiment rose to 67.7 in December on a scale around a center point of 80 (translates to 42.3 on a scale centering around 50).  The Architects Billing Index increased to 52.1 in November and the Home Builders Market Index increased to 21 in December 2011, both with a scale centering around 50.

 Over time, financial recovery is hoped to create economic recovery and growth in jobs.  At such time as Michigan sentiment rises above 80, U.S. Architects billings stays above 50, and the Home Builders Market index increases substantially toward 50, will the economy be in a sustained recovery.

 Chart I

  IDC Confidence Index is a Blend of Three Sentiment Indicators and Weights:

1)      University of Michigan Consumer Sentiment (75%)

2)      U.S. Architects Billing Index (15%)

3)      Home Builders Market Index (10%)

An IDC Confidence Index above 50 forecasts an environment favorable to revenue growth, high and improving returns on equity, and superior earnings growth.  Positive confidence levels, over 50, lasted long periods, such as March 1982 to July 1990 and December 1992 to September 2007.  During these two periods, the S&P 500 rose 132.8% and 250.4%, respectively.  During periods with IDC confidence over 50, stock selection based on franchise value offered the best returns with IDC large cap S&P portfolios outperforming the S&P 500 by 50% from 1995 to 2007, and midcaps more than doubling the returns of the S&P 500 in the same period (see Appendix I).

 University of Michigan Consumer Sentiment (75%) (see Chart II)

The problem occurs when theUniversityofMichigan Sentiment Indexdeclines below 80.  The consumer, who accounts for 70% of GDP, is measured by theUniversityofMichigan Sentiment Index.  The lack of consumer confidence reduces sales and profits of companies doing business in theU.S.  The recession of 1979 to 1983 was forecast byUniversityofMichigansentiment declining below 80 to a low of 52, as interest rates rose to 20% or more, as the Federal Reserve attempted to control inflation.

Consumer confidence again fell below80 in 1990through 1993, but recovered above 80 for short periods in between.  Revenue and earnings growth were disrupted in the recession.  The collapse of consumer confidence in the 2000 to 2002 period was from a peak of over 110 to 80.  The bear market in technology stocks and September 11, 2001 shock failed to create a consumer recession.  Revenue and earnings growth continued, as did the relative performance of IDC’s stock selection using franchise values.  Three year total returns were positive over the 2000 to 2002 period (see Appendix I).

 The major decline in theUniversityofMichigan Consumer Sentiment Indexto below 80 occurred in August and was confirmed in September 2007.  The economic engine of theU.S.was shut down, as consumer confidence fell to lows below60 in 2008and 2009.  Stock selection using franchise value was not as successful after the S&P 500 peak in October 2007.  Since IDC stock selection performed so well in the previous bull market, investors sold the favorable stocks to capture gains, as the stock market fell from over 1500 to 800 by November 21, 2008 (the first buy date from Fed liquidity or quantitative easing).

 Stock markets in the previous periods of consumer confidence under 50 were controlled by the Federal Reserve reducing the Fed Funds rate.  In the 2008 and 2009 collapse in equities in a period of financial crisis with threat of deflation, quantitative easing was the method of choice by the Fed, which, in turn, controlled the prices of tradable assets (S&P 500).

U.S. Architects Billing Index (15%) (see Chart III)

The U.S. Architects Billing Index above 50 indicates more architects have increasing billings (sales) than decreasing, and it forecasts rising nonresidential construction.  Conversely, and index below 50 indicates a forecast of declining nonresidential construction.  The theory is “before you build, you must have an architect draw the structure”.

 The recession of 2001 and 2002 had short periods of readings under 50.  In early 2008, the U.S. Architects Billing Index fell sharply below 50, bottoming at 33 in early 2009.  A level of 50 or above is required for the decline in commercial property prices to increase.  Only then would nonresidential construction begin a sustained recovery.

 Home Builders Market Index (10%) (see Chart IV)

The Home Builders Market Index measures the sentiment of home builders and the realtors traffic of consumers viewing homes.  A reading over 50 coincided with each housing boom.  A drop below 50 forecast a housing decline. In 1989 and 1990 and, again, after mid 2006, the decline in the index below 50 forecasted a housing recession.  A sustained recovery in housing requires an index level over 50, not foreseen in the next year or maybe longer. 

Chart II

Chart III

Chart IV

Chart V

 Home Builders Market Index Rises to New High of 21 in December 2011 and Forecasts a Modest Rise in Housing in 2012 and Limited Small Business Loan Demand

• The decline below 50 in the Home Builders Market Index (indicating falling demand for housing) in mid 2006 led by more than a year the sharp decline from a negative 8 to a negative 16 in the Small Business Credit Conditions Index in late 2007 to 2011 (see Chart I).  The fall in Small Business Credit Conditions led the decline in Small Business Hiring and the sharp rise in U.S. unemployment.

• The Home Builders Market Index of single-family loans rose 2 points to 21 in the month of December, 2011.  The rise adds to a revised 3 point increase in October, and brings the confidence gauge to its highest level since May, 2010.  Further, gradual gains in builder confidence are expected in 2012 due to selective markets with improving conditions.  Cash buyers caused the better readings, as mortgage applications for purchase of single-family homes remain weak (see chart VII).

• The lack of strength in residential construction continued the decline in residential construction jobs into 2011.  The huge decline in nonresidential building and construction jobs in 2009, 2010, and 2011, added to residential construction job losses, was a key factor in the overall weakness in job growth and consumer income, as well as, weak small business confidence.  Growth in construction jobs may be delayed for years given high levels of housing inventory and foreclosures.

• A Home Builders Market Index of 21 in December, 2011 forecasts flat to rising housing demand:

1. A level of 600,000 in housing permits in 2012 (see Chart II). 
2. A low in the rate of decline in single family house prices at a negative 20% in early 2009, followed by modest recovery to zero and forecast modest improvement in 2012 (see Chart III). 
3. Flat mortgage applications for single-family homes and a rise in builder confidence forecast sales of new homes to range from 300,000 to 400,000 into 2012 (see Chart IV). 
4. Existing home sales rose to 5.4 million homes in January 2011, following a low of 3.9 million homes in July 2010, and 5.0 million in October 2011 (see Chart V).  As mortgage applications for the purchase of single-family homes declined to a new low in late 2011, existing home sales leveled off around 5.0 million and new home sales were 300,000 given the large level of foreclosures (see Charts V and VII). 

Chart I

Chart II

Chart III

Chart IV

Chart V

Decline in ARM Applications Predicts Stalling Housing Recovery

 Since the early 1990’s, the boom cycle in housing was accompanied by applications for adjustable rate mortgages (ARMS) increasing above 20% of total mortgage applications for a one-year period, as in 1994-95, 1996-97 and 1999-2000.  In the last housing boom, ARM applications rose above 20% of total mortgage applications for 4 years (see Chart VI).  Given the high level of ARMS for 4 years ending September 2007, the high frequency in repricing of ARMS will continue into 2012. A failure of ARM applications to rise above 20% of total mortgage applications in future years limits the housing recovery and housing prices into the year 2012 or longer. The percentage of ARMS to total mortgage applications recovered from 1.4% in March to 6.9% in October 2009 (see Chart VI). The first peak in the ARMS percentage of 6.9% in October 2009, was followed by the decline to 4.9% in January 2011, an increase to a high of 7.1% in September 2011, and decline to 5.6% in December, 2011 forecasts a flat, low level of new housing credit demand. 

Chart VI

The Index of Mortgage Applications for Single-Family Homes Declines Below 200 in 2011

 The volume of mortgage applications for new purchases of single-family homes was 344 in January 2009, fell to 168 in June 2010, recovered to 211 in December 2010 and April 2011, fell again to a low of 158 in August 2011 and recovered to 191 in December, 2011, illustrating the weakness in housing credit demand.  Failure of the volume of mortgage applications for new single-family home purchases to grow in 2012 demonstrates the lack of sustained recovery in housing (see Chart VII). 

Chart VII

 A huge gap has opened in the early stages of economic recovery between big and small companies, with the former enjoying strong balance sheets, access to credit, and growing global markets, compared to the latter hurting from a lack of access to credit and reduced hiring plans, as sales volume remains weak.  Small business credit conditions, hiring plans, sales volume, and strengthening balance sheets depend on recovery in residential construction and consumer spending (see Chart IV).

 Small business credit conditions remained strong (above a negative from 1986 to 2007 allowing the Small Business Hiring Plans Index to remain positive (above a plus 5 – see Chart I).  The decline in small business credit conditions in late 2007 led by a year the decline in the Small Business Hiring Index.  Credit conditions fell to an all-time low of a negative16 in 2009and March 2010 and recovered to a negative 9 in April 2011, but fell slightly to a negative 10 by November 2011 (scale left, Chart I).  The Hiring Plans Index, required to be a plus 5 or higher to indicate economic recovery, rose to a positive 7 in November 2011, but other indicators failed to support the increase (scale right Chart I).

 ISM Non-manufacturing Employment Index decreased to 48.9 in November 2011, forecasting 0.5% employment growth for this huge sector for 2012.  The Small Business Job Opening Index increased to 16 in November 2011 and remains slightly above recession lows, which averaged 12 in 2010 (see Chart II).

 Michigan Confidence Index increased to 64.1 in November and must increase above 80 to support a sustained recovery.  The Small Business Optimism Index was 92.0 in November, down from the February peak of 94.5, and below the 100 level of sustained small business recovery (see Chart III).

Chart I

 Chart II

 Chart III

Small Business Credit Conditions Depend on Residential Construction

In order for small business to recover, (1) the Credit Conditions Index must rise to a negative 8 from a negative 10 in November 2011, (2) the Hiring Plans Index must rise to a positive 5, (3) the Small Business Optimism Index needs to climb from 92.0 to 100, and (4) the job openings index must increase from 16 in November to the 20 level.  A recession in small business remains a stronger possibility, especially with the recent readings in the most important Small Business Optimism Index falling to near cycle lows of 2008-2010.

Most important, the weak trend in the Home Builders (Sentiment) Market Index provides only modest support to improve Small Business Expected Credit Conditions (see Chart IV).

Chart IV