The U.S. banking industry is enjoying the benefits of a growing economy and lower taxes, as three of the largest lenders reported double-digit profit growth today.
The results reflected an array of positive business factors for banks, Reuters reports.
Net interest margins—the difference between what banks pay on deposits and what they charge on loans—have widened. Other key business lines, like managing customers’ wealth or providing treasury services for corporations, are generating consistent fees that pad the bottom line.
Banks also are getting a lift from cost-cutting programs they implemented after the 2007-2009 financial crisis, as well as tax cuts signed into law by President Donald Trump last year. Combined, those factors are saving the industry billions of dollars each quarter.
“Wages are going up. Participation is going up. Credit that’s been written is pristine. Housing is in short supply. Confidence—both small business, consumers—is extraordinary high, and that could drive a lot of growth for a while despite some of the headwinds out there,” JPMorgan Chase & Co Chief Executive Officer Jamie Dimon told analysts on a conference call.
