Banks beat expectations but some economic cracks form as caution abounds

• JPMorgan Chase, Wells Fargo, and Citigroup reported stronger-than-expected profits
• Consumers with weaker credit histories are facing pressure
• Geopolitical environment and challenges emerging among people with lower credit scores contribute to cautious outlook
• Citigroup CFO mentioned lower spending among people with FICO credit scores below 680
• Wells Fargo experienced a decline in mortgage originations and reduced headcount in its mortgage banking unit
• JPMorgan Chase signaled a cautious environment due to geopolitical factors
• Banks are seeing a return to pre-pandemic levels of spending and credit trends

Banks such as JPMorgan Chase, Wells Fargo, and Citigroup have reported stronger-than-expected profits. However, consumers with weaker credit histories are facing pressure, and there is caution in the outlook due to a worsening geopolitical environment and challenges among people with lower credit scores. Citigroup’s CFO mentioned that people with FICO credit scores below 680 have been reducing their spending. Wells Fargo experienced a decline in mortgage originations and is reducing headcount in its mortgage banking unit. JPMorgan Chase signaled a cautious environment due to geopolitical factors. Overall, banks are seeing a return to pre-pandemic levels of spending and credit trends.