Big Banks Stashed More Than $19 Billion to Protect Against Virus-Led Loan Defaults
Banks are reinforcing their cash stash in case billions of dollars in loans go into default during the coronavirus pandemic.
Five major banks including JPMorgan, Wells Fargo, Bank of America, Citigroup and Goldman Sachs now have a combined total of more than $19 billion in cash reserves held to guard against defaults, according to Business Insider.
JPMorgan has about $6.8 billion in reserve, while Wells Fargo has $3.1 billion set aside. Bank of America reported having $3.6 billion in reserve and Citigroup has saved back $4.9 billion in an emergency fund. Goldman reported the smallest reserve, wth $713 million — its business is less focused on lending to the public.
“Our reserve build reflects what we think as of the end of this quarter,” Paul Donofrio, chief financial officer at Bank of America, said in an earnings call, per Business Insider. “Now when we get to the end of the second quarter, we may have a different view of the future.”