Bank earnings this week offered a timely reminder that the U.S. consumer remains a far more durable force than many narratives suggest. The data produced by the largest financial institutions paints a picture of accelerating growth and improving credit quality, a combination not often seen. Banks are also finding themselves increasingly tied to the AI narrative, and executives used their earnings calls to detail both risks and opportunities of this technology.
The evidence of robust consumer spending was front and center during this quarter’s earnings results. Citigroup reported roughly 6% year-over-year growth in card spending, while Bank of America showed a similar 5% increase.1,2 These growth rates are both higher than the previous quarter’s results and hint that the consumer that still has income, confidence, and access to credit to drive economic growth.
This acceleration in spending doesn’t look like reckless abandon, either, as credit quality beneath the surface is improving. At Citigroup, net credit losses decreased nearly 13% compared to a year ago, as shown above.1. Bank of America showed a similar 11% decrease in net charge-offs compared to a year ago.2 These improvements directly contradict the idea that consumers are becoming strained. In fact, they suggest the opposite: balance sheets are stabilizing, and borrowers are managing their obligations more effectively than expected.
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Alongside these earnings, another development worth noting is Financials’ Increased Exposure to Tech as AI grows and requires capital. Throughout this earnings season, bank executives talked about a recent meeting with Treasury officials to discuss AI’s role in the financial system. JPMorgan CEO Jamie Dimon pointed to rapid advancements in models like Anthropic’s Mythos during the call, noting that “cyber risk…is our largest risk. We spend a lot of money…we’re constantly updating things…we’re testing [Mythos] now and looking at it, and it does create additional vulnerabilities…While we’re trying to get the benefits of AI, we are also very cognizant of the risks of cyber.”3 It’s clear that AI’s rapid advancement poses serious threats to financials, but also poses significant opportunities.
Taken as a whole, these earnings reports detail that a large foundation of the economy remains intact: consumers are spending at a growing rate while credit performance is simultaneously improving – a combination that is rarely seen. At the same time, banks are leaning into the next wave of technological transformation, positioning themselves for a future where AI plays a central role in operations and the need to be on cyber offense and defense is critical.
- https://www.citigroup.com/rcs/citigpa/storage/public/Earnings/Q12026/2026psqtr1rslt.pdf
- https://d1io3yog0oux5.cloudfront.net/_104c13957afe64ed2e10a6e41037a827/bankofamerica/db/780/10538/pdf/The+Presentation+Materials_1Q26.pdf
- https://finance.yahoo.com/quote/JPM/earnings/JPM-Q1-2026-earnings_call-415950.html
For more content by Blake Anderson, CFA®, Director, Portfolio Management, click here.
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