Banks brace for loan defaults by US, global customers

Banks report sinking profits as most economists expect the U.S. to go through a depression. The only question is how severe will it be.

By

National News

April 15, 2020 - 9:43 AM

NEW YORK (AP) — The major banks in the U.S. are anticipating a flood of loan defaults as households and business customers take a big financial hit from the coronavirus pandemic. 

Bank of America and Citigroup said today that their profits sank more than 40% in the first quarter as both set aside billions for potentially bad loans. A day earlier, JPMorgan Chase and Wells Fargo reported even steeper drops in profit. 

Even the investment banks were not immune to the pandemic. Goldman Sachs’ first-quarter profit dropped by 46% from a year earlier, due to significant losses on its own investments as well as a buildup in reserves for potential loan defaults.

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