JP Morgan takes $2.7bn capital hit from CECL

Adoption of the Current Expected Credit Losses (CECL) accounting standard at JP Morgan caused loan-loss allowances to surge $4.3 billion (30%) on January 1, and will lop $2.7 billion off retained earnings over the next three years.

Allowances for credit card portfolios leapt the highest following the switch to the new regime, by $5.5 billion (97%) to $11.2 billion. Those for home lending and other consumer loan portfolios edged up $100 million each, to $2 billion and $1.4 billion, respectively

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