American Banks Prepare for Decline in Profits, 17 Percent Drop Predicted for Top Six Banks in the Fourth Quarter
Big banks in the United States are getting ready to deal with shrinking profits due to factors like an overall difficult economic environment, despite the fact that interest incomes have risen over the past year.
JP Morgan Chase, Citigroup, Bank of America, Wells Fargo, Goldman Sachs, and Morgan Stanley are the six largest lenders in the United States. Combined, the six banks are expected to set aside $5.7 billion in reserves to deal with soured loans, which is more than double the $2.7 billion they had toset aside a year back.
“With most U.S. economists forecasting either a recession or significant slowdown this year, banks will likely incorporate a more severe economic outlook,” Morgan Stanley analysts said in a note, according to Reuters….