(Bloomberg) -- Bank of America Corp. Chief Executive Officer Brian Moynihan expects the U.S. economy to bounce back fairly quickly once the coronavirus health crisis is resolved.
“There are no structural issues in the economy -- it's a health-care crisis, and I think if we mitigate that health-care crisis, you will see on the other side of this a rebound,” Moynihan said in an interview Wednesday on Bloomberg Television. Consumer spending by the bank's customers rose 2% to 3% in March even as the virus started to crimp activity in the latter half of the month, he said.
“There will be a deeper downdraft” in the second quarter, but “our internal economists believe, on the other side, is a reversion back to where the economy almost gets back to the same size some time in the next year.”
The lender has made $70 billion of commercial loans this month, Moynihan said. That's up from a $50 billion figure Moynihan gave in an interview with CNBC on Friday.
Some of the biggest banks have also ramped up lending to U.S. companies wrestling with the impact of the coronavirus. They've made about $400 billion in loans to small and large American businesses in the first quarter, up 12.7% from a year earlier, according to the Bank Policy Institute, a trade association representing major financial firms.
Here are other takeaways from Moynihan's interview:
- “We're setting up shop and activating thousands of people to be able to take the applications” for the government's small business rescue program. “We'll have millions of customers come to us.”
- The bank has been “heavily involved” in talks on the program with the White House and Treasury; Chief Operating Officer Tom Montag has been in communication with the Federal Reserve, Treasury and other regulators on liquidity and market conditions.
- The severity of the coronavirus crisis sank in at a March 11 meeting with bank CEOs and President Donald Trump at the White House, which included a briefing from health experts.
- The gravity of the situation “really settled in on me,” Moynihan said. “We were running the company and moving people to work from home. We just said, ‘We just have to go hard and fast.' And we really quickly moved from alternating shifts, and things like that, to complete work from home. Then you start to see the human toll start to build up, the cases, and the issues of people in hospital and deaths, which are horrible.”
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