LESS: Allowance for Loan and Lease Losses, All Commercial Banks
H8B1043NCBCMG • Economic Data from Federal Reserve Economic Data (FRED)
Latest Value
-0.60
Year-over-Year Change
-200.00%
Date Range
8/1/2009 - 6/1/2025
Summary
LESS represents the estimated potential loan losses that commercial banks anticipate in their lending portfolios. This metric is a critical indicator of banking sector health and potential economic stress.
Analysis & Context
This economic indicator provides valuable insights into current market conditions and economic trends. The data is updated regularly by the Federal Reserve and represents one of the most reliable sources for economic analysis.
Understanding this metric helps economists, policymakers, and investors make informed decisions about economic conditions and future trends. The interactive chart above allows you to explore historical patterns and identify key trends over time.
About This Dataset
The Allowance for Loan and Lease Losses (LESS) reflects banks' proactive financial risk management strategy by setting aside reserves to cover potential future loan defaults. Economists closely monitor this trend as an early warning signal for credit market conditions and potential economic downturns.
Methodology
Data is collected through regulatory reporting requirements where commercial banks calculate expected credit losses based on historical performance, current economic conditions, and forward-looking projections.
Historical Context
Policymakers and financial regulators use LESS data to assess banking system resilience and potential systemic risks in the broader financial ecosystem.
Key Facts
- LESS represents banks' estimated potential credit losses
- Higher values can indicate increased economic uncertainty
- Tracked quarterly by federal financial regulators
FAQs
Q: What does LESS indicate about bank health?
A: LESS shows how much banks expect to lose from potential loan defaults, reflecting their assessment of credit risk and economic conditions.
Q: How do changes in LESS impact lending?
A: Increasing LESS might signal banks becoming more cautious, potentially reducing new loan availability and tightening credit markets.
Q: How is LESS calculated?
A: Banks estimate LESS by analyzing historical loan performance, current economic indicators, and projected future credit risks.
Q: Why do investors track LESS?
A: Investors use LESS as an early indicator of potential economic stress and banking sector stability.
Q: How often is LESS data updated?
A: LESS data is typically updated quarterly by the Federal Reserve as part of standard banking sector reporting.
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Citation
U.S. Federal Reserve, LESS: Allowance for Loan and Lease Losses, All Commercial Banks [H8B1043NCBCMG], retrieved from FRED.
Last Checked: 8/1/2025