Big banks post big earnings, but lending is more muted

Summary

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Marketplace Morning Report

Episode: Big banks post big earnings, but lending is more muted

Date: October 15, 2025
Host: David Brancaccio

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Overview

This episode dives into the latest financial results for major U.S. banks, highlighting robust earnings from investment banking and trading, but noting a muted lending environment. The discussion investigates the factors influencing restrained lending activity and the rise in credit card usage among consumers, while also considering the broader implications for the economy. The episode further covers the U.S. Department of Justice's record Bitcoin seizure tied to a massive cryptocurrency scam and updates on looming labor tensions on Broadway.

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Key Discussion Points & Insights

1. Big Bank Earnings: Strong Profits Amid Muted Lending

[01:09 - 03:51]

• Major Banks’ Performance:

  • JPMorgan Chase reports an 18% profit increase.
  • Citi’s revenue went up across all divisions.
  • Bank of America and Morgan Stanley post higher than expected profits, especially from investment banking and trading.

• Lending Sluggishness:

  • Lending growth remains "fairly muted" in the latest quarter.
    • Quote: “There are a lot of businesses that are reluctant to take on more debt right now.” – Tom Collins, West Monroe [01:41]
  • High interest rates are deterring both businesses and consumers, especially impacting mortgages and home equity loans.
    • Quote: “It has not made economic sense for people to tap into that equity.” – Michael Pierce, Oxford Economics [02:08]

• Credit Card Borrowing Contrast:

  • Credit card loan volumes are rising, indicating a shift in consumer borrowing habits.
    • Quote: “We’ve seen a big rebound in consumer discretionary spending—things like travel, trips away, hotels.” – Michael Pierce [02:28]

2. Diverging Consumer Experiences

[02:37 - 03:51]

• Spending uptick driven by higher-income households (often older, homeowners, or with significant stock portfolios).
  • Quote: “When the stock market’s high and going higher, you know, consumers opening their wallets.” – Michael Pierce [02:46]
• Lower-income, younger, and renting consumers are still struggling.
  • Quote: “We’re seeing struggles…those tend to be younger, more likely renters, those on lower and moderate incomes.” – Michael Pierce [03:03]
• Banks are preparing for potential defaults by setting aside more money to cover at-risk loans due to concerns over a softening labor market.
  • Quote: “If consumers don’t have a job…they tend to get late on their payments.” – Stephen Bigger, Argus Research [03:24]
• Current loan delinquencies and losses remain modest.
  • Quote: “Maybe call them yellow flags at this point instead of red flags. We’re just not … seeing any big deterioration.” – Stephen Bigger [03:42]
• Bank Outlook: JPMorgan CEO Jamie Dimon maintains that, despite uncertainties, the U.S. economy remains resilient.

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3. DOJ’s Historic Bitcoin Seizure & Cryptocurrency Scam

[04:02 - 05:15]

• DOJ seizes $14 billion worth of Bitcoin in a crackdown on Prince Group, a Cambodian crime syndicate accused of orchestrating a vast cryptocurrency scam.
  • Quote: “They allege that Prince Group lured people online and tricked them into sending them their bitcoin, thinking they’d be invested … but instead just stole their money.” – Maura Fogarty, BBC [04:25]
• UK authorities also confiscated properties totaling over $130 million connected to the scam.
• The operation included human trafficking, forcing people to work in scam call centers.

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4. Additional Headlines

A. Labor & Economic Policy

[05:15 - 05:37]

• Nobel Economics Prize winner Joel Mokier, interviewed by Brancaccio, expresses concern that social and political institutions may not keep up with technological advances, rather than fearing AI itself.
• Treasury Secretary Scott Besant: Government shutdown is costing up to $15 billion a day, with debates centering on cuts to the Affordable Care Act and Medicaid.

B. Broadway Strike Authorization

[06:45 - 07:57]

• Broadway musicians, stage managers, and actors have authorized a strike amid rising operational costs and difficult negotiations.
  • Quote: “The vast majority of the money ... is going into the pockets of people, of humans, of workers. We can’t deny that’s a reality.” – Heather Shields, Producer [06:59]
  • Inflation and increased costs are squeezing profits, making contract agreements harder.
  • Quote: “Bottom line, there’s just simply less money to split between the groups.” – Matthew Roseau, Susquehanna University [07:45]

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Notable Quotes

• “There are a lot of businesses that are reluctant to take on more debt right now.”
  – Tom Collins, West Monroe [01:41]

• “It has not made economic sense for people to tap into that equity.”
  – Michael Pierce, Oxford Economics [02:08]

• “When the stock market’s high and going higher, you know, consumers opening their wallets.”
  – Michael Pierce, Oxford Economics [02:46]

• “We’re seeing struggles…those tend to be younger, more likely renters, those on lower and moderate incomes.”
  – Michael Pierce [03:03]

• “Maybe call them yellow flags at this point instead of red flags. We’re just not … seeing any big deterioration.”
  – Stephen Bigger, Argus Research [03:42]

• “They allege that Prince Group lured people online and tricked them into sending them their bitcoin… but instead just stole their money.”
  – Maura Fogarty, BBC [04:25]

• “The vast majority of the money ... is going into the pockets of people, of humans, of workers.”
  – Heather Shields, Broadway Producer [06:59]

• “Bottom line, there’s just simply less money to split between the groups.”
  – Matthew Roseau, Susquehanna University [07:45]

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Timestamps for Key Segments

• 01:09 – Major banks’ earnings & muted lending environment
• 01:41 – Analysis of why lending is subdued (Tom Collins)
• 02:08 – Consumer hesitation on mortgages/home equity (Michael Pierce)
• 02:28 – Spike in credit card usage & higher-income consumer spending (Michael Pierce)
• 03:03 – Financial struggles for lower-income consumers (Michael Pierce)
• 03:24 – Bank preparations for possible defaults (Stephen Bigger)
• 03:42 – Loan delinquencies only a “yellow flag” (Stephen Bigger)
• 04:02 – DOJ seizure of $14 billion in Bitcoin, Prince Group scam (Maura Fogarty)
• 05:15 – Broader economic concerns, Treasury Secretary on shutdown costs
• 06:45 – Broadway musicians authorize strike, cost pressures (Heather Shields, Matthew Roseau)

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Memorable Moments

• The show’s portrayal of a “two-speed” consumer economy, with higher-income households driving much of the current spending rebound while younger, lower-income groups continue to struggle.
• Coverage of the record-breaking DOJ Bitcoin seizure—an example of both growing crypto crime and international cooperation.
• Insightful, human-centered discussion of labor negotiations on Broadway, highlighting that rising costs are affecting both sides of the dispute.

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Summary prepared for those seeking a succinct, engaging rundown of the Marketplace Morning Report’s October 15, 2025 episode.

Transcript

[Bridget]

Hello listeners. Marketplace's Webby winning kids podcast Million Bazillion is back for an all new season. Hosts Bridget and Ryan are answering a whole new set of kid questions about everything from royalties and franchises to why the heck we have a two dollar bill. Even grown ups might learn a thing or Two Million Bazillion is presented in partnership with Greenlight, the debit card and money app for kids and teens. Give your family the tools to manage money wisely with Greenlight. Learn [e-mail] million and tune into Million Bazillion wherever you find your favorite podcasts.

[Ryan]

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[David Brancaccio]

Laughing all the way to the big banks I'm David Brancaccio in Los Angeles. This is the week banks reveal how much they made this summer. Yesterday, JPMorgan Chase announced profits up 18% revenue revenue at Citi went up across everything it does. Bank of America and Morgan Stanley this morning reported higher than expected profits and revenue from jet set stuff like investment banking and trading securities. But the more down to earth business of lending out money? Not as strong. Marketplace's Justin Ho reports lending in general.

[Ryan]

Was fairly muted in the most recent quarter. Tom Collins with the consulting company West Monroe, says that's partly because there are a lot of businesses that are reluctant to take on more debt. Right now.

[Michael Pierce]

It's companies that are especially rate sensitive or potentially tariff sensitive.

[Ryan]

On the consumer side, Collins says there's still a lot of hesitation around mortgages, thanks again to high interest rates. Same story with home equity lines of.

[David Brancaccio]

Credit rates have stayed high enough that.

[Michael Pierce]

It has not made economic sense for.

[David Brancaccio]

People to tap into that equity.

[Ryan]

But one type of consumer credit that has been growing is credit cards. JPMorgan Chase says loan volumes on its cards are up over the last year. Michael Pierce, deputy chief US Economist at Oxford Economics, says that's likely because consumer spending has been picking up recently, particularly.

[Michael Pierce]

In consumer discretionary spending. So things like travel, trips away, hotels, that's where we've seen a big rebound in spending growth.

[Ryan]

Pierce says a lot of that spending is being driven by higher income households. Think older consumers who might own their own homes or their own stock market portfolios.

[Michael Pierce]

You know, really the value of their portfolios is a huge determinant of how confident they're feeling, of how much they feel they're able to spend. And so, yeah, we see when the stock market's high and going higher, you know, consumers opening their wallets.

[Ryan]

But Piers says there are plenty of people who are not feeling that confident.

[Michael Pierce]

The consumers where I think we're seeing struggles and continuing signs of struggles of those, you know, tend to be younger, more likely to be renters, those on lower and moderate incomes.

[Ryan]

As a result, some banks have been setting aside more money to cover loans that could go bad. Stephen Bigger is a bank analyst at Argus Research. He says that's partly because lenders are concerned about the slowing labor market.

[Michael Pierce]

So if consumers don't have a job or have difficulty replacing one, if they lose it, they tend to get late on their payments.

[Ryan]

But while we have seen signs of stress among lower income consumers, Bigger says delinquencies and loan losses have been modest. In in other words, he says banks are not waving any red flags.

[Michael Pierce]

You know, maybe call them yellow flags at this point instead of red flags. We're just not, we're not seeing any big deterioration when you're talking about the industry at large just yet.

[Ryan]

JPMorgan Chase CEO Jamie Dimon said even though there's still uncertainty around geopolitics, trade and inflation, the economy is resilient. I'm Justin Ho for Marketplace.

[David Brancaccio]

The Justice Department says it has seized $14 billion in Bitcoin and accused the founder of a Cambodian business empire, Prince, with masterminding a massive cryptocurrency scam. These are the calls, texts and social media solicitations that slowly drew in victims worldwide to invest money that was then stolen. Here's the BBC's Maura Fogarty.

[Maura Fogarty]

The Department of Justice has labeled Prince Group as a criminal enterprise. It accuses it of money laundering, wire fraud, essentially running a massive cryptocurrency scam based out of Cambodia. According to the doj. They allege that Prince Group lured people online and tricked them into sending them their bitcoin, thinking they'd be invested and we'd get profits on the back of it, but instead essentially just stole their money. The U.S. department of justice says that it is the largest seizure of Bitcoin that they've ever made as part of a UK US joint sting operation where in the UK authorities there have seized about 19 properties in and around London, an office building worth more than $130 million, a mansion that they say were illegally bought from the business proceeds of this criminal enterprise.

[David Brancaccio]

Part of this, authorities say, involved human trafficking in Southeast Asia to force people to work in call centers to perpetrate the scams. I caught up with one of this week's winners of the Nobel Economics Prize. Northwestern University's Joel Mokier says he's not worried artificial intelligence will run amok, but he is worried that social and political institutions can't keep up with advances in technology. Marketplace Morning podcast feed or streaming from our homepage now. And in an interview on cnbc, Treasury Secretary Scott Besant said the government shutdown is starting to hurt the economy, maybe up to $15 billion a day. He said the central fight is over cuts to Affordable Care act programs and Medicaid coverage. A Sapphire Reserve story from the Foster.

[Heather Shields]

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[Ryan]

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[Heather Shields]

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[David Brancaccio]

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[Odoo/Chase Sponsor Voice]

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[David Brancaccio]

Broadway musicians have voted overwhelmingly to authorize a strike as unions representing musicians, stage managers and actors try to negotiate contracts with Broadway producers. Marketplace's Carla Javier reports, Broadway shows brought.

[Heather Shields]

In more money than they ever had in the season that ended this spring. But at the same time, says producer Heather Shields, the frank assessment of it is that everything costs more money these days, she says. The cost of lumber is rising. So is the cost of trucking around, materials and equipment shows need. But the vast majority of the money that is spent to get a show open and to run a show is going into the pockets of people, of humans, of workers. We can't deny that that's a reality. We also can't deny that it's a reality that the cost of living is much higher and the cost of healthcare is much higher. And not every show can raise ticket prices to cover high costs due to inflation, says Matthew Roseau, dean of the school of business at Susquehanna University and a big Broadway fan.

[Ryan]

Bottom line, there's just simply less money.

[Michael Pierce]

To split between the groups.

[Ryan]

And that is probably why we're seeing the threat of a strike. When there's less to split, it's much tougher to come to an agreement.

[Heather Shields]

The actors and stage managers union and the producers trade group are expected to continue talks on Friday. CARLA I'm Carla Javier from Marketplace and.

[David Brancaccio]

In Los Angeles, I'm David Brancaccio. This is the Marketplace Morning Report.

[Ryan]

From.

[David Brancaccio]

Apm, American Public Media.

[Odoo/Chase Sponsor Voice]

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