Overview

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As U.S. lenders begin to report earnings this week, investors' focus will likely shift from profits to bank bosses' remarks on the economy after President Donald Trump Forecast as of: . Sources: U.S. Bank Economics, Moody’s Analytics, and Bloomberg. 1 Projections for real GDP are annual percent change. Projections for housing starts in Both banks are expected to report lower profits for the third quarter after interest income may shrink while loan demand remained subdued. The sector reaped a Both banks are expected to report lower profits for the third quarter after interest income may shrink while loan demand remained subdued. The sector reaped a Reuters has reported that some of the largest U.S. Banks are projecting lowered profits as they prepare for a potential recession. The report notes that some of the NEW YORK (S&P Global Ratings) Aug. 21, The sharp rise in interest rates and quantitative tightening deployed since March 2025 to combat high inflation are weighing on many U.S. PNC Financial Services Inc, Citizens Financial Group Inc. and Cullen/Frost Bankers led a retreat in bank stocks on Tuesday after Moody’s published 27 ratings actions on U.S. banks.

U.S. Banks Project Lowered Profits Amidst Potential Recession Fears

As U.S. lenders begin to report earnings this week, investors' focus will likely shift from profits to bank bosses' remarks on the economy after President Donald Trump Forecast as of: . Sources: U.S. Bank Economics, Moody’s Analytics, and Bloomberg. 1 Projections for real GDP are annual percent change. Projections for housing starts in… Is a recession looming? The answer, according to recent reports, is a qualified yes, impacting the banking sector significantly. Reuters has reported that some of the largest U.S. Banks are projecting lowered profits as they prepare for a potential recession. The report notes that some of the financial institutions are bracing for impact.

Shrinking Interest Income and Subdued Loan Demand

Both banks are expected to report lower profits for the third quarter after interest income may shrink while loan demand remained subdued. The sector reaped a… this is largely due to changing economic conditions. The potential for a recession is influencing lending strategies and consumer behavior, contributing to the profit downturn. The increased caution surrounding economic activity is a primary driver.

Moody's Downgrade and Banking Sector Retreat

NEW YORK (S&P Global Ratings) Aug. 21… adding further pressure to the industry. The sharp rise in interest rates and quantitative tightening deployed since March 2025 to combat high inflation are weighing on many U.S. banks. PNC Financial Services Inc, Citizens Financial Group Inc. and Cullen/Frost Bankers led a retreat in bank stocks on Tuesday after Moody’s published 27 ratings actions on U.S. banks.

Navigating the Economic Uncertainty

Banks are carefully monitoring key economic indicators and adjusting their strategies to mitigate potential losses. As earnings reports are released, analysts will be closely scrutinizing banks' outlooks and capital reserves in the face of a possible recession. The ability to navigate this uncertainty will be crucial for the long-term stability and profitability of U.S. banks.

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