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That increase will coincide with rising credit costs and rising prices.
"So they will see rising credit losses at least until 2010".
The drop in income was attributed to concerns about the bank's rising credit card risk.
Dozens of lenders are reducing or eliminating dividends to preserve capital needed to cover rising credit losses.
On July 7th the KBW Bank index of American commercial-bank shares fell to its lowest level since 1997, as investors fretted about rising credit losses.
Like many of its rivals, SunTrust has faced rising credit losses and a difficult interest rate environment that has hurt lending margins.
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(Marginal Revolution) Are rising credit-default swap spreads actually helping the Greek government?
Rising credit-default swap rates signal investor fears that the insurer will be unable to pay its debts.
As interest rates rise, credit cards will probably become more competitive (though they may be pricier for less creditworthy borrowers).
Meanwhile, according to Oppenheimer & Co. analyst Meredith Whitney the second wave of the credit crisis will hit lending, as banks face rising consumer credit losses.
Even as share prices keep rising, the credit markets struggle to get deals away.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com