Loan loss reserves: The pandemic in five charts

The big six US banks are releasing the loan loss reserves they built up in the pandemic. Where might this end? The answer could be surprising.

One of the more notable stories of the big US bank quarterly earnings seasons this year has been loan loss allowances. The reserves that the banks had ramped up in the early days of the pandemic are starting to be released.

Taken in aggregate, loan loss allowances at Bank of America, Citigroup, Goldman Sachs, JPMorgan, Morgan Stanley and Wells Fargo soared from $57.5 billion on January 1, 2020, to about $101 billion six months later, a rise of 75%.

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