BusinessPostCorner.com
No Result
View All Result
Wednesday, June 18, 2025
  • Home
  • Business
  • Finance
  • Accounting
  • Tax
  • Management
  • Marketing
  • Crypto News
  • Human Resources
BusinessPostCorner.com
  • Home
  • Business
  • Finance
  • Accounting
  • Tax
  • Management
  • Marketing
  • Crypto News
  • Human Resources
No Result
View All Result
BusinessPostCorner.com
No Result
View All Result

Top four US banks grab a growing share of industry’s profits

November 11, 2023
in Finance
Reading Time: 3 mins read
A A
0
Top four US banks grab a growing share of industry’s profits
ShareShareShareShareShare

Stay informed with free updates

Simply sign up to the US banks myFT Digest — delivered directly to your inbox.

The four biggest US lenders grabbed almost half of all banking profits in the third quarter, highlighting their growing advantage in the new era of higher-for-longer interest rates.

Earnings at JPMorgan Chase, Bank of America, Wells Fargo and Citigroup were up 23 per cent according to BankRegData, which collates quarterly reports from lenders to the Federal Deposit Insurance Corporation.

Of the nation’s almost 4,400 banks, the big four made 45 per cent of the industry’s overall profits in the third quarter. That was up from 35 per cent a year ago, and well above the 10-year average of 39 per cent.

By contrast profits at all other institutions dropped by an average 19 per cent in the quarter, their largest fall since the early months of the coronavirus pandemic.

“The biggest banks have not had that much deposit pressure,” said Alexander Yokum, who follows regional banks for CFRA. “You see the net interest margins of the smaller banks have been hit much harder than the big banks.”

Overall, banking industry profits fell 5 per cent in the third quarter. They were dragged down by losses on lending and bond market investments as well as a 260 per cent increase in interest costs — mainly what banks have to pay depositors to stop them from seeking a better deal somewhere else, according to BankRegData.

“Not a horrible quarter, but profits are going to continue to be strained,” said Christopher Whalen, a veteran bank analyst and head of Whalen Global Advisors, of the industry-wide picture.

The fall in profits compared with a 10 per cent increase in profits in the second quarter and was the first drop in the industry’s overall earnings in six quarters.

Nonetheless, while profits were down for the whole industry, the bottom lines at the four largest US banks, the only lenders in the nation with more than $1trn in assets each, as a group were up 23 per cent versus the same period a year ago.

Yokum said small banks are more exposed to commercial real estate, and offices in particular, one of the biggest areas of concern for lending. So they have had to reserve more as a percentage of their loans for potential losses.

But the biggest reason for the divide is the fact that the big banks, perhaps because of technological advantages or perceived safety due to their size, have not had to pay up as much to keep depositors.

The big four were paying less than 2 per cent a year on accounts that paid interest in the third quarter. That compares to nearly 3 per cent average for regional banks. What is more, more than 40 per cent of the deposit accounts at the nation’s four largest banks pay no interest at all. That compares to 30 per cent for the industry overall.

“I would said it’s infuriating, but I am a bank analyst, not a consumer advocate,” said Yokum.

“For whatever reason, people have not moved their money from the big banks, and so they just haven’t had to pay up.”

Credit: Source link

ShareTweetSendPinShare
Previous Post

Oil majors call on Washington and Brussels to intervene in LNG dispute

Next Post

New Rules Mean Millions Of Students Can Prove They Went To College

Next Post
New Rules Mean Millions Of Students Can Prove They Went To College

New Rules Mean Millions Of Students Can Prove They Went To College

Sainsburys and Morrisons told to stop advertising heated tobacco

Sainsburys and Morrisons told to stop advertising heated tobacco

June 14, 2025
Port of LA imports fell nearly 20% in May, and it may mean higher prices and fewer choices on back-to-school and Halloween items

Port of LA imports fell nearly 20% in May, and it may mean higher prices and fewer choices on back-to-school and Halloween items

June 16, 2025
Can Israel destroy Iran’s nuclear sites?

Can Israel destroy Iran’s nuclear sites?

June 13, 2025
RSM launches myRSM Tax ecosystem

RSM launches myRSM Tax ecosystem

June 16, 2025
Binance Leads in Altcoin and Stablecoin Deposits Across ETH and TRON: CryptoQuant

Binance Leads in Altcoin and Stablecoin Deposits Across ETH and TRON: CryptoQuant

June 17, 2025
Hong Kong Customs Teams with HKU to Trace Crypto Transactions

Hong Kong Customs Teams with HKU to Trace Crypto Transactions

June 13, 2025
BusinessPostCorner.com

BusinessPostCorner.com is an online news portal that aims to share the latest news about following topics: Accounting, Tax, Business, Finance, Crypto, Management, Human resources and Marketing. Feel free to get in touch with us!

Recent News

OpenLedger and UC Berkeley Give Students Direct Ownership in Building Decentralized AI

OpenLedger and UC Berkeley Give Students Direct Ownership in Building Decentralized AI

June 18, 2025
SCOTUS limits Tax Court jurisdiction if an IRS tax levy disappears

SCOTUS limits Tax Court jurisdiction if an IRS tax levy disappears

June 18, 2025

Our Newsletter!

Loading
  • Contact Us
  • Privacy Policy
  • Terms of Use
  • DMCA

© 2023 businesspostcorner.com - All Rights Reserved!

No Result
View All Result
  • Home
  • Business
  • Finance
  • Accounting
  • Tax
  • Management
  • Marketing
  • Crypto News
  • Human Resources

© 2023 businesspostcorner.com - All Rights Reserved!