The country's largest bank, JPMorgan Chase, has set aside the largest amount of money since 2010 to prepare for defaults. Chase says its profit fell by 69%. Wells Fargo's profits fell 89%.
Banks are starting to reel from the financial impact of job losses and business shutdowns across the country from the coronavirus.
Two of the nation's biggest banks reported plummeting profits during the first three months of the year, as they sought to prepare for an onslaught of defaults in debt that ranged from credit cards and mortgages to business loans.by 69% as it set aside $8.2 billion — the largest amount since 2010 — to prepare for defaults.
Bank earnings are being scrutinized especially closely this week, as an early sign of how much damage has been done to the broader economy and the financial health of both businesses and people as a result of the COVI-19 pandemic. "Banks see much of the economic activity of the country ... and hence have a better idea of the size of the economic shock," said Sebastien Galy, a senior macro strategist at Nordea Asset Management, in a research note.
Goldman Sachs, Bank of America and Citigroup report earnings Wednesday, and Morgan Stanley will do so later in the week.
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