Credit

The San Francisco bank identified "signs of weakness" and increased its loan loss reserves substantially. Small and midsize banks have significantly larger exposures than Wells does to the office segment, which has been hit by changing work habits.

Lenders are bracing for more companies to fall behind on their loan payments. That could create more opportunities for banks to dispose of these nonperforming credits through an Article 9 sale.

Apple began rolling out its first buy now/pay later service after a lengthy delay, entering a field currently dominated by Affirm, Klarna and others.

Banks with strong underwriting and stress testing should be well positioned to survive the credit and liquidity issues that may come while being able to continue to serve customers.

A reasonable approach to comprehensive credit risk management can protect banks against the impact of a recession while ensuring the industry doesn't contribute to any potential economic volatility.

No one company can solve this credit scoring problem. Banks, fintechs and innovative startups must come together in partnership to share information and change the existing system.

The specter of an economic downturn looms, but many companies are still in growth mode, according to Donald McCree, head of commercial banking at the Rhode Island bank. "We continue to hear from a lot of companies that they are doing quite well," he said.

The rise of e-commerce during the pandemic has fueled demand for warehouse space as companies look to move their products closer to their customers. While a slight slowdown is now under way, bankers still see plenty of business ahead.

About 3% of borrowers in their 20s and 30s became seriously delinquent on their credit card payments last quarter, significantly faster than older consumers. The picture was similar in auto lending, according to research by the Federal Reserve Bank of New York.

After soured loans rose above the private student lender's expectations in 2022, its stock price fell 16% on Thursday. One analyst wrote that "persistent credit issues have damaged management's credibility."