FT News Briefing Loan losses mount for US banks
Jul 10, 2023
Israel is gearing up for a contentious vote on judicial reforms, igniting significant public discourse. Meanwhile, major U.S. banks are bracing for their largest loan losses since the pandemic began, raising concerns over economic stability. In a strategic shift, global manufacturers are moving operations from China to Vietnam, seeking better labor costs and geopolitical security. Additionally, Japan's currency dynamics reveal a waning interest in traditional savings methods among younger generations.
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Rising Loan Losses
- US banks expect the biggest jump in loan losses since the pandemic began.
- This is due to higher interest rates and the depletion of pandemic savings.
State of US Banks
- Despite rising loan losses, big US banks are currently in good shape.
- Profits are up, but concerns exist about future profitability.
Shift to Vietnam
- Global manufacturers are moving business from China to Vietnam.
- Vietnam offers cheaper labor, political stability, and proximity to China's supply chains.