Divergent Credit Loss Trends Hit Global Banking Reserves
HSBC expanded its expected credit loss allowance while Bank of America and UBS saw reserves contract.
Coverage: 3 of 11 companies in this theme (HSBC, UBS, BAC) — a sample, not the full set.
HSBC Holdings (HSBC) expanded its allowance for expected credit losses to $12.0bn. This figure represents an increase of $0.8bn compared with 31 December 2025, a movement that included write-offs of $0.7bn and favorable foreign exchange movements of $0.1bn.
Other global players moved in the opposite direction. Bank of America (BAC) reduced its allowance for credit losses by $71 million from December 31, 2025.
This adjustment brought the Bank of America reserve level to $14.3 billion as of March 31, 2026.
UBS Group (UBS) also realized a reduction in its reserves.
Stage 3 for UBS reflected a small net release during the quarter. The bank attributed this result to a repayment recorded across both the Investment Bank and Non-core and Legacy segments.
These shifting reserve levels highlight a fragmented credit outlook across the major global lenders.