US banks profits declined in the last quarter of 2023
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| US banks profits declined in the last quarter of 2023 |
US bank profits fell by about 45% in the last quarter of 2023, even as pressure on consumers eased and confidence increased that the US economy could avoid recession in the short term.
According to data from BankRegData - the data provider that collects quarterly reports prepared by lenders to the Federal Deposit Insurance Corporation - reported by the Financial Times, the total profits of the US banking sector fell to levels of $38 billion in the period from October to December, in the largest... Quarterly decline on a yearly basis since the second quarter of 2020.
Profits were reduced by one-time charges related to last year's regional banking crisis, and profits were also reduced by an increase of about $5 billion in provisions for bad loans, $4 billion in banks' securities portfolios, and higher costs as banks sought to reduce staff.
The total number of full-time employees at US bank branches decreased by more than 45,000 last year. Wells Fargo alone spent more than $1 billion on unexpected job cuts in the fourth quarter. The decline in bank profits last quarter indicates how the rapid rise in interest rates is affecting lenders, even as JPMorgan reported record annual profits last year.