Weekly Global News Wrap: Wells Fargo slimming down mortgage business; Swiss central bank reports biggest annual loss ever
And US banks expected to report lower earnings as they brace for economic slowdown.
Switzerland’s central bank posted its biggest annual loss in its 115 year history, as falling stock and fixed-income markets hit the value of its share and portfolio.
The Swiss National Bank reported $143b (CHF132b) in 2022, it reported on Monday. It is equivalent to slightly more than the annual GDP of Morocco.
Wells Fargo & Co announced that it is slimming down its home lending business by reducing its mortgage servicing portfolio and exiting the correspondent lending business.
“We are making the decision to continue to reduce risk in the mortgage business by reducing its size and narrowing its focus," Kleber Santos, the bank's chief executive for consumer lending, said in a statement.
Demand for mortgages and refinancing has weakened as interest rates climbed.
US banking giants forecast lower fourth quarter profits as they stockpile funds in preparation for an economic slowdown that is battering investment banking.
Four American banking giants–JPMorgan Chase & Co, Bank of America Corp, Citigroup Inc and Wells Fargo & Co–will report earnings on Friday.
Along with Morgan Stanley and Goldman Sachs, they are the six largest lenders expected to amass a combined $5.7b in reserves to prepare for soured loans, according to average projections by Refinitiv. That is more than double the $2.37 billion set aside in 2022.