JP Morgan and BofA’s credit loss provisions highest since Covid outbreak
Quarterly set-asides eat into 13% and 11% of banks’ NIIs in Q2
JP Morgan and Bank of America booked a combined $4.6 billion in provisions for credit losses (PCLs) during the second quarter, their highest since the early months of the Covid-19 pandemic, both in absolute terms and relative to net interest income (NII).
Reserves to cover expected defaults increased to $3.1 billion at JP Morgan, marking a 62% increase on the previous quarter. This equated to 13.4% of the bank’s NII.
BofA recorded PCLs of $1.5 billion, 14% higher than in Q1, leading to an 11%
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