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BofA, JPMorgan Exposed to New Covid Spikes, Morgan Stanley Warns

  • Analysts also say Texas, Florida must stop case growth soon
  • Outbreak may become uncontrollable without tough moves
Pedestrians wearing protective masks walk past a JPMorgan Chase & Co. bank branch.
Pedestrians wearing protective masks walk past a JPMorgan Chase & Co. bank branch.Photographer: Mark Kauzlarich/Bloomberg

Spiking Covid-19 cases in Florida, Texas, California, Arizona and Georgia may mean “significant stress” for businesses operating there, especially if governors halt reopening plans, according to Morgan Stanley. That may in turn pressure credit quality, analysts led by Ken Zerbe and Betsy Graseck wrote in a note.

Zerbe and Graseck highlighted banks with the greatest dollar exposure in the “epicenter” of the pandemic. They include the biggest lenders: Bank of America Corp., with $618 billion in deposits across those five states, as per 2019 data; Wells Fargo & Co., with $467 billion; JPMorgan Chase & Co., with $420 billion, and Truist Financial Corp., with $140 billion.