This article from Wall Street Journal is written by Ben Eisen
Bank of America Corp. BAC 4.47% said Thursday that third-quarter profit rose 58%, suggesting banks’ lending businesses are starting to improve from a pandemic slump.
The bank released $1.1 billion of the reserves it had set aside for pandemic loan defaults, helping boost its profit. Revenue was up 12% from the year-ago period.
Bank profits soared in the latest quarter in large part because the U.S. economy bounced back so quickly from the pandemic recession. Banks last year set aside billions of dollars to prepare for a wave of loan defaults, but now they are releasing the money they had socked away. That helped power double-digit earnings gains at JPMorgan Chase & Co., Citigroup Inc. and Wells Fargo & Co. Equities trading and a deal-making boom also pushed up earnings.
