Lending Slump Worries Investors Even as U.S. Bank Profits Soar
- BofA had a 14% decline in loan balances, Wells Fargo a 9% drop
- Companies meanwhile benefited from trading, investment banking
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Investors are signaling fresh concern about when the largest U.S. banks will get back to their bread-and-butter business: lending money.
JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon’s statement about “challenged” lending -- a word he quickly said he regretted using -- pressured share prices, as did shrinking quarterly loans across banks. Bank of America Corp. reported a 14% decline in loan balances in the first quarter from a year earlier, while Citigroup Inc. said Thursday that loans tumbled 10%. Those dropoffs followed the 4% slump in loan balances at JPMorgan and the 9% decrease at Wells Fargo & Co., reported Wednesday.