{"id":570275,"date":"2023-04-14T20:00:55","date_gmt":"2023-04-14T17:00:55","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/what-crisis-big-bank-profits-soar-despite-banking-troubles\/"},"modified":"2023-04-14T20:00:55","modified_gmt":"2023-04-14T17:00:55","slug":"what-crisis-big-bank-profits-soar-despite-banking-troubles","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/what-crisis-big-bank-profits-soar-despite-banking-troubles\/","title":{"rendered":"#What crisis? Big bank profits soar despite banking troubles\u00a0"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3df6586090d\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3df6586090d\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/what-crisis-big-bank-profits-soar-despite-banking-troubles\/#Bank_filings_reveal_deposit_data\" >Bank filings reveal deposit data\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/what-crisis-big-bank-profits-soar-despite-banking-troubles\/#Banks_confirm_lending_slowdown\" >Banks confirm lending slowdown<\/a><\/li><\/ul><\/nav><\/div>\n<div>\n<p>Large U.S. banks reported massive earnings Friday, signaling that the biggest institutions largely shrugged off the banking crisis stemming from Silicon Valley Bank\u2019s collapse.\u00a0<\/p>\n<p>JPMorgan Chase, the largest bank in the nation, posted $12.6 billion in first-quarter profits, a whopping 52 percent increase from the same period last year.\u00a0<\/p>\n<aside class=\"ad-unit ad-unit--mr1_ab\"><\/aside>\n<p>Wells Fargo\u2019s quarterly profits rose 32 percent year-over-year. Citigroup reported a 23 percent annual increase in profit, while PNC Financial Services\u2019 profits rose around 18 percent. All of the big banks surpassed investors\u2019 profit expectations.\u00a0<\/p>\n<p>While the Federal Reserve\u2019s interest rate hikes contributed to SVB\u2019s failure \u2014 the bank loaded up on long-term treasury bonds that plummeted in value after rates rose \u2014 they\u2019re helping the largest lenders.\u00a0<\/p>\n<p><strong>Trouble ahead? 4 major risks still facing banks and why you should care<\/strong><\/p>\n<p>JPMorgan, Citigroup and Wells Fargo, three of the four largest U.S. banks, credited the surprisingly strong profits to spiking interest income. Higher interest rates enabled banks to charge more for loans.<\/p>\n<p>The banks added that their exposure to commercial real estate is relatively low. Analysts fear that small and midsize lenders \u2014 which hold most of those mortgages \u2014 could soon suffer from a wave of defaults as remote and hybrid work drives down the value of office buildings.\u00a0<\/p>\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"5472\" height=\"3648\" src=\"https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/10\/AP17132060152941.jpg?w=900\" alt=\"\" class=\"wp-image-3695474\" srcset=\"https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/10\/AP17132060152941.jpg 5472w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/10\/AP17132060152941.jpg?resize=300,200 300w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/10\/AP17132060152941.jpg?resize=768,512 768w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/10\/AP17132060152941.jpg?resize=1080,720 1080w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/10\/AP17132060152941.jpg?resize=1536,1024 1536w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/10\/AP17132060152941.jpg?resize=2048,1365 2048w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/10\/AP17132060152941.jpg?resize=645,430 645w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/10\/AP17132060152941.jpg?resize=50,33 50w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/10\/AP17132060152941.jpg?resize=876,584 876w\" sizes=\"auto, (max-width: 899px) 100vw, 876px\"><figcaption class=\"wp-element-caption\"><sub><em>A person walks past a Wells Fargo location in Philadelphia on May 11, 2017. (AP Photo\/Matt Rourke)<\/em><\/sub><\/figcaption><\/figure>\n<h2><span class=\"ez-toc-section\" id=\"Bank_filings_reveal_deposit_data\"><\/span>Bank filings reveal deposit data\u00a0<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Big banks had been expected to show deposit drops following last month\u2019s bank runs and an influx of deposits into money market funds and other low-risk investments.\u00a0<\/p>\n<aside class=\"ad-unit ad-unit--mr2_ab\"><\/aside>\n<p>But JPMorgan actually saw its deposits rise from $2.34 trillion to $2.38 trillion in the first quarter. PNC\u2019s deposits grew slightly, Citigroup\u2019s deposits remained flat and Wells Fargo\u2019s deposits fell 2 percent.\u00a0<\/p>\n<p>Commercial bank deposits fell by around $310 billion around the time of SVB\u2019s collapse before recovering slightly in the final month of March, according to <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.federalreserve.gov\/releases\/h8\/current\/default.htm\">Federal Reserve data<\/a>.\u00a0<\/p>\n<p>That prompted concerns that more banks could go under. <\/p>\n<aside class=\"ad-unit ad-unit--mr3_ab\"><\/aside>\n<p>Analysts pointed to $620 billion in unrealized losses on long-term investments in the banking system that would make it harder for banks to survive a surge in withdrawals.\u00a0<\/p>\n<p>SVB\u2019s failure prompted wealthy individuals and businesses to pull their money from midsize lenders, which faced the biggest threat of a bank run. They transferred their cash to the largest institutions that are seen as too big to fail.\u00a0<\/p>\n<p><strong>Still feeling pinched: Here\u2019s where Americans are pulling back their spending as inflation takes a toll<\/strong><\/p>\n<aside class=\"ad-unit ad-unit--mr4_ab\"><\/aside>\n<p>\u201cBy definition, these are somewhat flighty deposits because they just came into us. So it\u2019s prudent and <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ropriate for us to assume that they won\u2019t be particularly stable,\u201d JPMorgan Chief Financial Officer Jeremy Barnum said on an earnings call Friday.\u00a0<\/p>\n<p>The rush of withdrawals slowed after Treasury Secretary Janet Yellen hinted that regulators would take action to protect all uninsured deposits if other midsize banks went under, like they did with SVB.\u00a0\u00a0<\/p>\n<p>Big banks last month banded together to give $30 billion in deposits to San Francisco\u2019s First Republic Bank, which swiftly lost around $70 billion in deposits following the SVB collapse. The move was meant to restore confidence in the regional lender and the banking system more broadly.\u00a0<\/p>\n<aside class=\"ad-unit ad-unit--mr5_ab\"><\/aside>\n<p>First Republic will report its earnings on April 24. The bank had been expected to reveal its balance sheet this week.\u00a0<\/p>\n<p>Bank executives expressed confidence in regional banks Friday, noting that SVB faced a unique bank run from its client base dominated by tech firms and venture capitalists.<\/p>\n<p>\u201cOur franchise, and those of many other banks, operate with a broader business model and more diversified funding sources,\u201d Wells Fargo CEO Charles Scharf said on an earnings call.<\/p>\n<aside class=\"ad-unit ad-unit--mr6_ab\"><\/aside>\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"1400\" height=\"787\" src=\"https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?w=900\" alt=\"JPMorgan Chase &amp; Co. Chairman and CEO Jamie Dimon\" class=\"wp-image-3654050\" srcset=\"https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg 1400w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?resize=160,90 160w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?resize=300,169 300w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?resize=768,432 768w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?resize=1280,720 1280w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?resize=645,363 645w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?resize=320,180 320w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?resize=256,144 256w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?resize=512,288 512w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?resize=640,360 640w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?resize=876,492 876w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?resize=960,540 960w, https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2022\/09\/dimonjamie_092122gn_w.jpg?resize=50,28 50w\" sizes=\"auto, (max-width: 899px) 100vw, 876px\"><figcaption class=\"wp-element-caption\"><sup><em>JPMorgan Chase &amp; Co. Chairman and CEO Jamie Dimon answers questions during a House Financial Services Committee oversight hearing of the largest U.S. banks on Sept. 21, 2022.<\/em><\/sup><\/figcaption><\/figure>\n<h2><span class=\"ez-toc-section\" id=\"Banks_confirm_lending_slowdown\"><\/span>Banks confirm lending slowdown<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Big bank executives said Friday that they plan to pull back on lending and set aside more cash in case their existing loans go bad.\u00a0<\/p>\n<p>Analysts have expressed concern that if bank lending slows to a crawl, a credit crunch could ravage the U.S. economy that relies on financing to grow and add jobs.\u00a0\u00a0<\/p>\n<p>\u201cI wouldn\u2019t use the word credit crunch,\u201d JPMorgan CEO Jamie Dimon said on an earnings call Friday. \u201cI just look at it as a kind of a thumb on the scale. It just makes the financing conditions a little bit tighter and increases the odds of a recession.\u201d<\/p>\n<aside class=\"ad-unit ad-unit--mr7_ab\"><\/aside>\n<p>Commercial lending by U.S. banks declined by nearly $105 billion in the final two weeks of March, the largest drop on record.\u00a0<\/p>\n<p><strong>Boom times for some: JPMorgan Chase profits jump 52% amid banking turmoil<\/strong><\/p>\n<p>There\u2019s no shortage of signs that a recession is looming.\u00a0<\/p>\n<p>Retail sales fell 1 percent in March as spending at a broad range of retail categories dropped. When adjusting for inflation, retail sales fell 2 percent over the last year, meaning consumers are buying fewer items. <\/p>\n<p>Wholesale inflation fell 0.5 percent last month. That\u2019s a sign that price hikes are finally coming to an end but also a warning that demand is falling rapidly.\u00a0<\/p>\n<p>Federal Reserve staffers predicted last month that a \u201cmild recession\u201d will hit the U.S. economy starting later this year, followed by a recovery over the subsequent two years. Numerous economists have made similar calls.<\/p>\n<\/div>\n<p>Copyright 2023 Nexstar <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">Media<\/a> Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.<\/p>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/thehill.com\/business\/economy\/3950796-what-crisis-big-bank-profits-soar-despite-banking-troubles\/\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Large U.S. banks reported massive earnings Friday, signaling that the biggest institutions largely shrugged off the banking crisis stemming from Silicon Valley Bank\u2019s collapse.\u00a0 JPMorgan Chase, the largest bank in the nation, posted $12.6 billion in first-quarter profits, a whopping 52 percent increase from the same period last year.\u00a0 Wells Fargo\u2019s quarterly profits rose 32&#8230;<\/p>\n","protected":false},"author":1,"featured_media":570276,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/thehill.com\/wp-content\/uploads\/sites\/2\/2023\/02\/banks_092116ap_ripping-off.jpg?w=1280","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[75802,141269,141293,141564,71939,134343,12561,70932,134418,139529,142428,134661,70551,70552,70792,142429,71525,142430,142431,91261,141178,72113],"class_list":["post-570275","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-jpmorgan","tag-svb","tag-bank-run","tag-banking-crisis","tag-banks","tag-campaign","tag-chase","tag-citigroup","tag-congress-blog","tag-defense-national-security","tag-deposits","tag-energy-environment","tag-inflation","tag-interest-rates","tag-jpmorgan-chase","tag-lending-slowdown","tag-national-security","tag-pnc","tag-profits","tag-recession","tag-silicon-valley-bank","tag-wells-fargo"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/570275","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=570275"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/570275\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/570276"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=570275"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=570275"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=570275"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}