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Banks stockpile billions as they prepare for things to get worse

Collectively, JPMorgan Chase, Citigroup and Wells Fargo have put aside $25 billion during the second quarter, they said. As a result, their quarterly profits plunged.

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Citigroup added $5.6 billion in the second quarter to its fund to cover future loan losses. JPMorgan Chase added nearly $11 billion and Wells Fargo $8.4 bn

Emily Flitter, Stacy Cowley & Gillian Friedman | NYT

4 min read Last Updated : Jul 15 2020 | 11:57 PM IST

Three of the United States’ biggest banks revealed on Tuesday that they had set aside billions of dollars to cover potential losses on loans, signaling that they don’t expect consumers and corporations to be able to pay their debts in the coming months as the pandemic continues to gut employment and commerce.

Collectively, JPMorgan Chase, Citigroup and Wells Fargo have put aside $25 billion during the second quarter, they said. As a result, their quarterly profits plunged. It was Wells Fargo’s first quarterly loss since 2008.

Bank executives said government aid had so far cushioned the economic fallout from the coronavirus pandemic,

Topics : Coronavirus JP Morgan Wells Fargo Citigroup Global economy global economic crisis US economy loan default Loan repayment US Federal Reserve

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