The combination of low unemployment, rising wages and falling interest rates means more households are taking out loans for big-ticket items like speedboats and mobile homes.
Midsize players like BankUnited, BOK and Fulton Financial plan to rely on selective M&A, catering to niches overlooked by big banks, aggressive recruitment of commercial lenders and other strategies to stimulate revenue growth.
Huntington Bancshares and U.S. Bancorp also said in recent days that they are eliminating jobs to reduce overhead and improve profits. With net interest margins shrinking and branch traffic continuing to decline, expect more banks to follow suit, analysts say.
It has already been modifying more problem loans and investing in efforts to recover charged-off loans, and now the credit card lender is ready to tighten underwriting in case the economy weakens.
The company says the upgrade will support future digital investments. It also said Tuesday that third-quarter profits climbed 8% but reported a sharp increase in criticized business loans.
Amid concern that an economic downturn is approaching, Greg Carmichael said that banks need to focus on credit quality and not worry about expanding their balance sheets.
