(Bloomberg) -- As the biggest U.S. banks struggle to get loan growth back on track, there's one class of customer where lending is on the rise: rich people.
JPMorgan Chase & Co. and Goldman Sachs Group Inc. said borrowing by those clients boomed during the second quarter even as loans to less-wealthy customers continued to stagnate.
Average loans in JPMorgan's asset- and wealth-management business jumped 21% in the second quarter, the bank said Tuesday in a statement. By contrast, average loans in the consumer division, where the company caters to less-affluent borrowers, fell 3%. Goldman said wealth-management loans climbed $12 billion from a year earlier, a 43% jump.
“The industry has had a harder time with loan growth recently,” Mary Erdoes, head of JPMorgan's asset and wealth-management unit, said at a conference in June. “The private bank is an exception to that. It's the one area of the firm that continues to grow at a super healthy pace.”
The government's economic stimulus program pumped trillions of dollars into consumers' pockets to help them recover from the pandemic. A side effect has been to weaken their demand for new loans. Still, New York-based JPMorgan said it expects higher levels of consumer spending as the economy rebounds to translate into more borrowing.
“The obvious question is the outlook for loan growth,” Chief Financial Officer Jeremy Barnum said on an earnings call Tuesday. “We are quite optimistic that the current spend trend will convert into resumption of loan growth through the end of this year and into next.”
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