“Our consumers have lots of money in their checking accounts,” Brian Moynihan, BoA CEO B said Sunday on CBS’s “Face the Nation.” “They have not spent about 65% to 75% of the last couple rounds of stimulus.”
Spending by consumers at the 2nd-biggest U.S. bank exceeded $1-T so far this yr, up 20% over Y 2019, he said.
Domestic travel spending, such as car rentals and hotels for leisure trips, has increased, and consumers are shifting from buying food in the store to visiting sit-down restaurants, he said.
The US economy is projected to grow 7% this yr and 5.5% next yr, according to Bank of America’s research team.
Loans are “starting to pick up,” and there’s plenty of borrowing capacity because companies have unused credit lines, CEO Moynihan said. Loan growth has been a challenge across the banking industry because many consumers and businesses are sitting on cash from savings and stimulus during the VirusCasedemic.
In Q-1, Bank of America reported a decline in loans in the consumer banking unit. CEO Moynihan said then that the bank is “highly focused” on capturing loan growth during the economic recovery.
The Key risks to economic growth are supply chain and labor shortages, CEO Moynihan said. In a spring survey conducted by the bank, small businesses said their Top concerns were getting workers and supplies to match the demand. “That’s something that’s straightening out, but will take a little time,” he said.
Have a healthy week, Keep the Faith!