As of 2002, Alabama's 121 insured banks had assets of $19.57 billion. There were no insured savings institutions in 2002. By the end of 1995, the Resolution Trust Corporation had resolved 11 Alabama savings and loan institutions which had $4.0 billion in assets and $3.3 billion in deposits through 498,000 accounts.
The economic downturn that began in 2001 affected Alabama before the nation as a whole. The deterioration of the economy, in terms of job losses, for example, did not however affect the banking industry in the same way. Community banks (those with assets under $1 billion) headquartered in Alabama registered strong performance from 2001 to 2002, as net income rose 15%, propelled by improvements in net interest margins (NIMs) (the difference between the lower rates offered to savers and the higher rates charged on loans). During that period, the Federal Reserve cut interest rates a number of times, which increased banks' profitability. As well, the state saw a shift in loan portfolios to higher yielding commercial real estate (CRE) loans. At the end of September 2002, CRE loans accounted for 16% of assets. Personal bankruptcy filings increased throughout the state in 2001/02, however.