NEW YORK–In a potential move for credit unions to be aware of, Citigroup said it is putting aside hundreds of millions of more dollars than it did in the first quarter of 2025 to prepare for potential losses on loans.

It’s an early sign that the biggest U.S. banks “may be bracing for deteriorating economic health,” CNBC reported.

“Given the macro environment, etc., cost of credit compared to last quarter, we expect to be up a few hundred million,” Vis Raghavan, Citigroup’s head of banking, said at a conference hosted by Morgan Stanley, as reported by CNBC.

Raghavan  added the numbers were driven by the bank’s credit reserve build, a figure that can change frequently depending on a company’s outlook.

‘Cautious Approach’

“The figures laid out by Raghavan, also executive vice chair at Citigroup, point to a cautious approach for the months ahead, even as analysts expect loan losses to decline in the second quarter,” CNBC said. “Banks build reserves for future risks based on macroeconomic indicators, which can vary from quarter to quarter. Reserves can also grow because a firm is lending at higher volumes.”

The bank’s provisions for credit losses — which typically cover losses recognized in the period and any building of reserves for the future — totaled $2.72 billion in the first quarter, while the analyst consensus for the second quarter is down slightly — to $2.69 billion, the report added.