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The Finance 202: Banks brace for loan defaults, predicting sharper economic pain ahead

Jul 15, 2020 - Washington Post Blogs
Financial Results-Negative Financial Results

Some of the biggest U.S. banks are putting their money where their fear is. JPMorgan Chase, Citigroup and Wells Fargo are bracing for a deteriorating economic outlook by adding a combined $28 billion to their reserves, the banking giants announced in second-quarter earnings calls Tuesday.

The moves are aimed at bulking up defenses against consumer and corporate loan defaults. The firms are planning for the possibility that those credit losses pile up in the months ahead if the ec...