Trade agreements

The COVID-19 pandemic revealed the fragility of complex global supply chains. Bankers say they are hearing from more U.S. clients who want to change that by moving manufacturing and supplier operations closer to home.

The timing couldn’t be worse for ag and energy lenders as well as global banks, which were all counting on the Chinese market to help bolster commercial lending and fee income.

Lenders that depend on the Export-Import Bank to back loans to exporters are already seeing business borrowing pick up after Congress reauthorized the agency in December.

A smiling President Donald Trump thanked some of the biggest U.S. companies for about 10 minutes on Wednesday at the White House, where he was celebrating his trade deal with China. When it came to JPMorgan Chase, he asked for reciprocation.

The country's biggest bank is leaning more on fee income to offset rate pressures, expanding in selected U.S. cities and laying the groundwork for operations in China that CEO Jamie Dimon hopes will endure “for 100 years.”

But some industry watchers are tempering expectations, saying that the language is too vague to know for sure if China is serious about introducing more foreign competition.

Though details of a potential pact with China aren't clear, bankers are hoping it could convince leery customers to finally go through with delayed investments.

Many business customers are putting off expansion because they can’t find enough workers to fill available jobs.

The percentage of farm lenders losing money hit a six-year high in the third quarter, according to the FDIC.

So far farm loans are holding up well, but bankers gathered at an industry conference this week said they are growing increasingly concerned that credit quality will weaken if the U.S. and China don’t reach a deal soon.