US banks report big profit jumps

A trio of large US banks reported significantly higher profits yesterday, boosted by a strengthening US economy that has diminished the need to set aside funds for loan defaults.

Bank of America’s results were lifted by the release of $1.1 billion in reserves, while Citi’s got a $1.2 billion boost. Wells Fargo’s quarter was helped by a $1.7 billion reduction in provisions.

“We reported strong results as the economy continued to improve and our businesses regained the organic customer growth momentum we saw before the pandemic,” said Bank of America Chief Executive Bryan Moynihan.

Large banks set aside billions of dollars early in 2020 amid fears that lockdowns to address Covid-19 would lead to a global depression.