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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
Bloomberg business news
Bank of America Sees Trading Revenue Jump, Banking Fees Surge

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.