Bank of America said Thursday that it had added $4 billion to the pool of funds it keeps to cover credit losses as it prepares for customers to default on their loans at an increasing rate once the government programs designed to support Americans through the coronavirus crisis come to an end.
The bank’s key performance measures remained fairly steady, despite the broader economic slowdown. Revenue for the quarter was $22 billion, compared to $23 billion during the same period a year ago. The bank earned $3.5 billion for the quarter, compared to $7.3 billion during the second quarter of 2019. It now has $21 billion set aside for credit losses.
Bank officials expect unemployment to remain in the double digits for the rest of the year and then fall to around 7 percent in 2021. But even though they are prepared for loan losses to rise, the officials said they were encouraged by recent customer activity.
“We’re seeing early signs of cautious optimism,” Paul D’Onofrio, Bank of America’s chief financial officer, said on a call with journalists on Thursday. Mr. D’Onofrio said that spending by bank customers had risen and the bank’s commercial clients were starting to repay the money they had quickly taken from revolving credit lines during the height of the lockdowns in March and April.