Bank of America CEO doesn’t see many signs of a 2023 recession. Here’s why

The recession that economists and investors feared in 2022 hasn’t happened yet, Bank of America CEO Brian Moynihan said Tuesday.

During livestreamed remarks at the Bank of America Securities Financial Services Conference in New York City, the chief executive of the Charlotte-based bank said that so far, he isn’t seeing any signs of a downturn.

Consumers are still spending, wealthy bank clients are still investing their cash and businesses have yet to see profits drop off, Moynihan said.

“They’re trying to be careful,” he said of the bank’s commercial customers. “But most of them, honestly, when you ask them are saying ‘I thought I’d be in worse condition right now. I thought I’d be facing more pressures, and things are still fine.’”

Moynihan’s comments echoed previous public remarks. He’s emphasized that, despite macroeconomic concerns about inflation and rising interest rates, consumers are still pumping money through the economy.

“Consumers have money, they’re employed, they’re spending and they have a lot of capacity to borrow,” he said. “That is what makes whatever we’re going through different.”

Last spring, economists warned of an oncoming recession as prices rose and the Federal Reserve increased rates in response.

But so far, the economy has avoided the crash landing that many feared: unemployment is at historic lows, and Americans aren’t holding on to their cash like they usually do in times of economic uncertainty.

This month, the U.S. unemployment rate fell to 3.4%, its lowest in more than half a century. And on Tuesday morning, the Labor Department reported that the pace of inflation continued its decline, falling to 6.4%.

Moynihan noted that, though the economy seems healthy now, a downturn could still be ahead, and firms are wise to prepare for that outcome.

“They’re sitting and saying ‘I know it’s gotta come. The Fed can’t tighten this aggressively and not cause (a slowdown),” he said. “I understand that.”

How Bank of America avoids job cuts

Moynihan also touched on the bank’s headcount.

During the 13 years that he’s led the bank, Bank of America’s total number of employees has varied greatly, ebbing and flowing between 200,000 and 300,000 workers.

The bank currently employs about 218,000 workers, Moynihan said.

Though other major banks, such as Goldman Sachs and Morgan Stanley, have announced major layoffs as the banking sector slowed last year, Moynihan has previously said that he’ll avoid deep job cuts.

Instead, he said, Bank of America will let headcount shrink naturally through leaving some roles unfilled when workers voluntarily leave the bank.

Bank of America was still hiring through the end of last year, adding 3,000 employees in the fourth quarter, Moynihan said.

The bank’s employment in Charlotte has grown as well.

In 2021, Bank of America had about 16,000 employees in the region. That number has increased to 18,000, the bank confirmed to The Charlotte Observer this month.

This story was originally published February 14, 2023, 1:39 PM.