U.S. Banking Outlook 3Q20: Interesting times

Summary

Banks remain critical for supporting the economy during the crisis. Total bank loan growth will slow and deposit growth revert to normal rates. Banks will be operating with higher levels of deposits relative to loans, credit quality will deteriorate and profitability edge down, but systemic risks remain contained.

Key points

• Key points:
• Loans: Idiosyncrasies galore
• Deposits: Flush with cash
• Credit quality: Not as bad as it could be
• Profitability: Silver linings amid an abundance of challenges

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