Loan Growth Drives Banking Profits Amid Resilient Economy

U.S. banking giants report increased profits, highlighting economic resilience. Bank of America and JPMorgan see significant loan growth, while potential credit card interest caps pose challenges amid geopolitical tensions. Analysts remain optimistic about continued economic stability and favorable lending conditions, despite uncertainties around credit availability and Fed independence.

U.S. banking giants have reported increased profits in the fourth quarter, buoyed by rising demand for loans and signaling economic resilience. Bank of America announced an 8% growth in average loans compared to the previous year, with net interest income soaring to a record $15.9 billion. JPMorgan Chase reported a 9% increase in average loans.

The U.S. economy, supported by an artificial intelligence boom and interest-rate cuts by the Federal Reserve, shows resilience despite President Donald Trump's import tariffs. Analysts are optimistic about sustained loan growth into 2026, with macroeconomic stability and favorable lending conditions in focus.

Concerns remain over President Trump's proposal to cap credit card interest rates at 10%, with banking executives worried about potential impacts on credit availability and economic growth. Meanwhile, the importance of the Federal Reserve's independence is emphasized by leading bankers amid political pressures for further interest rate cuts.

(With inputs from agencies.)