JPMorgan Chase, Wells Fargo Suffer $3,500,000,000 in Losses As US Banks Report Massive Surge in Bad Debt

Two major U.S. banks announced they had booked losses after customers were unable to repay $3.5 billion in debt.

JPMorgan Chase To tell The company’s net loan loss reserves – past-due debts that banks do not expect to be collected – reached $2.2 billion in the second quarter of this year.

This represents an increase of $200 million from the previous quarter and an increase of $800 million from the second quarter of 2023.

Meanwhile, Wells Fargo To tell The company’s net loan loss provisions jumped from $764 billion in the second quarter of 2023 to $1.3 billion last quarter, a 70% increase.

Although the pace of inflation is slowing, Wells Fargo Chief Financial Officer Michael Santomasimo tell The New York Times reported that many customers are clearly struggling as their credit card balances rise and their savings dwindle.

“[Inflation is] “There’s still a bit of a cumulative effect. People at the lower end of the wealth and income spectrum are struggling more than people at the higher end.”

In addition to the charge-offs, JPMorgan disclosed an additional $500 million in losses from failed mortgage investments.

U.S. banks have been sounding the alarm over the past year about rising customer credit card balances and problems in the commercial real estate industry.

Wells Fargo reported second-quarter profit of $4.9 billion in a new report, but the bank’s shares fell 6% on Friday after net interest income fell short of expectations.

JPMorgan Chase reported quarterly profit of $13.1 billion as its stock price hovered near all-time highs.

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