US Banks Amass $88,660,000,000 Cash Stockpile in Just Three Months As Lenders Abruptly Hoard Assets: S&P Global
US Banks Hoard Cash Amid Slow Loan Growth in Q1
Financial data and analytics firm S&P Global recently reported that US banks are increasingly stockpiling cash on their balance sheets, signaling a reluctance to lend despite the strong growth in deposits.
According to S&P Global, banks boosted their cash and equivalents by a significant $88.66 billion in the first quarter of 2025. Leading the pack in this trend were banking giants JPMorgan Chase and Citibank, driven by a surge in non-US deposits.
“The increase in cash holdings reflects a cautious approach by banks and customers amidst uncertainties surrounding tariffs. Cash and equivalents saw a substantial median change of 11.0% in Q1, compared to just 0.3% in the previous quarter.”
Despite the cash accumulation, loan growth remained lackluster, with an increase of less than one percent in the first quarter. This tepid growth was particularly evident in credit card, nonresidential construction, farm, and auto loans, indicating a broader trend of cautious lending practices.
“Analysts are revising down their projections for net loan growth among major US banks, suggesting a continued sluggishness in lending activities for the rest of the year.”
As banks prioritize liquidity and conservative lending strategies, the focus on cash accumulation is likely to persist in the near future. This trend underscores the cautious sentiment prevalent in the banking sector amidst economic uncertainties.
