July 11, 2024 | Premium Service | In this edition of The Institutional Risk Analyst, we take a look at the consumer lenders as Q2 2024 earnings begin to see what these institutions are telling us about the likelihood of a recession in 2025. But earnings are a secondary concern as President Joe Biden nears a decision to step aside in favor of Vice President Kamala Harris.
Events with respect to President Biden are moving, but very slowly. We still expect him to step aside since the family has now isolated the President from even senior Democrats. Our assumption was that a decision could wait until the Democratic Convention because of concerns about the $200 million campaign war chest, but that may now be in doubt. Comment from former Representative and Trump OMB head Mick Mulvaney below:
In our regular monthly discussion with Janet Alvarez on SiriusXM Business Radio, we spoke about our expectations for the rest of the year. The immediate prospect that we expect to see front-and-center is continued losses in the world of commercial real estate, but slow deterioration in consumer credit that may not really surge until 2025. Thus we focus on the consumer lender cohort as we begin Q2 2024 financial earnings tomorrow with JPMorgan (JPM), Wells Fargo (WFC), Citigroup (C) and Washington Federal (WAFD).
The consumer lenders include a number of familiar names, but also some new entrants that may be less well-known. Our surveillance group includes Ally Financial (ALLY), American Express (AXP), Axos (AX), Barclays Financial (USA), CapitalOne Financial (COF), SoFi Technology (SOFI) and Synchrony Financial (SYF). The rankings for these issuers in the Q2 WGA Bank Top 100 is shown below.
