Higher profitability, improved asset quality and loan growth put U.S. banks in a better position compared with the financial crisis period, said a U.S. banking industry regulator on Tuesday.

The Federal Deposit Insurance Corporation (FDIC) reported commercial banks and savings institutions gained net income of 37. 6 billion U.S. dollars in the third quarter of 2012, up 6.6 percent from the same period last year. This is the 13th consecutive quarter with a year-on-year increase.

"Signs of further progress were evident in a number of indicators," said FDIC Chairman Martin Gruenberg. Increased noninterest income and lower provisions for loan losses accounted for most of the improvement in earnings, the FDIC explained in the latest Quarterly Banking Profile.

Loan loss provisions totaled 14.8 billion dollars, which was 20. 6 percent less than the same quarter last year. Net operating revenue, which tallies net interest income and total noninterest income, amounted to 169.6 billion dollars, 3.0 percent up from last year, as gains from loan sales rose by 3.9 billion dollars. Net interest income was 746 million dollars, 0.7 percent higher than last year.

Compared with a year ago, 57.5 percent of all banks reported improvements in their quarterly net income. And the share of banks reporting net losses fell to 10.5 percent from 14.6 percent. The average return on assets, a basic yardstick of profitability, rose to 1.06 percent from 1.03 percent.

At the same time, the number of problem banks declined for a sixth consecutive quarter from 732 to 694, the first time in three years to see fewer than 700 banks on the "Problem List".

The number of bank failures fell for the eighth time in the last nine quarters. Twelve FDIC-insured banks failed in the third quarter, the fewest in a quarter since the fourth quarter of 2008. A total of 50 banks have failed so far this year, compared to 90 failures at this point last year.

More than 55 percent of banks saw loan growth, noted Gruenberg. Loan balances posted their fifth quarterly increase in the last six quarters, rising by 64.8 billion dollars (0.9 percent). Loans to commercial and industrial borrowers increased by 31.8 billion ( 2.2 percent), while residential mortgages rose by 14.5 billion dollars (0.8 percent) and auto loans grew by 7.4 billion dollars ( 2.4 percent). However, home equity lines of credit declined by 12. 9 billion dollars (2.2 percent), and real estate construction and development loans fell by 6.9 billion dollars (3.2 percent). Endi