Loan-loss provisions

Nine months after acquiring Heartland Financial, Missouri's largest bank posted a complicated quarter.

Bank of Montreal in its fiscal second quarter set aside more money to cover loans that are still in good standing, highlighting concern about the fate of the North American economy.

Toronto-Dominion Bank set aside less money than expected for souring loans in the second quarter, despite concerns that U.S. tariffs would hamper economic growth.

The Buffalo, New York-based bank also said Monday that the commercial real estate lending market has started showing signs of life, but that the renewed competition is crimping its loan growth.

The Toronto-based bank set aside CA$1.5 billion in its fiscal fourth quarter to cover potentially bad loans. Executives say higher-than-normal impaired losses could persist next year.

Cleveland-based KeyCorp posts a subdued profit in the wake of a loan loss provision that was more than six times greater than the level of fourth-quarter net charge-offs.

With virus cases in its home state hitting their highest level since February, the San Antonio company declined to release reserves — a route that many banks took to boost their second-quarter profits.

The Texas company kept allowances steady, citing lingering concerns over the pandemic and commercial real estate. Yet it plans to open 25 offices in Dallas after a similar expansion in Houston drove asset and customer growth.

Banks lowered their loss provisions at the end of 2020, a sign they feel better about this year than last year, according to data from the FDIC. But loan balances fell for the second straight quarter and the annual loan growth rate was the lowest in seven years.

Some big banks trimmed their stockpiles that guard against loan losses in the fourth quarter, but overall allowances fell less than many observers predicted. The trend will likely continue given uncertainties surrounding vaccine distribution and the economy.

Just a few months after signaling that provisions for loan losses had peaked, many banks are planning to once again add to reserves to guard against pandemic-related defaults, according to a survey released by IntraFi Network.

The company's Silicon Valley Bank unit reduced its loan-loss cushion by $52 million. Private-equity and VC clients have warmed to the practice of doing deals virtually, which increases lending opportunities, SVB executives said.

The Cincinnati company, one of just a handful of lenders to reduce its cushion against bad credits in the third quarter, was grilled by analysts who suggested it was being too optimistic about the long-term effects of the pandemic recession.

Revenue at each of Goldman Sachs’s four divisions rose from a year earlier, pushing earnings per share to a record that was almost twice as high as analysts predicted.

The company posted a surprise increase in third-quarter expenses as it set aside almost $1 billion for customer remediation and $718 million in restructuring charges.

Third-quarter net income dropped nearly 16% from a year earlier as revenues at the company's consumer unit declined at about the same pace and trading revenue gains were below estimates.

The company defied expectations by cutting its reserve for loan losses by $569 million, after adding $20 billion to the allowance in the first half.

At a time when the industry is focused on serving members and assisting with the economic recovery, executives shouldn't be burdened by a costly new credit loss methodology.

The regulator approved a proposal that mirrors a rule banking regulators implemented in February 2019 to cushion the Current Expected Credit Losses standard's impact on capital levels.

Other regionals set more aside for loan losses than the Cleveland bank did in the second quarter, and its ratio of reserves to total loans is slightly lower, too. But Key executives say the portfolio is balanced and holding up well despite the pandemic’s economic toll.