Turmoil in financial markets created some profitable opportunities for large banks in the first quarter, but results released Wednesday underscored the industry's expectations for a potentially deep US recession.

Trading divisions at large banks garnered boom-like revenue jumps as turmoil in financial markets prompted more transactions of equities and bonds.

But Citigroup, Bank of America and Goldman Sachs each set aside large sums of money in case of bad loans, significantly denting profits and reflecting expectations for potentially major defaults in a slowing US economy amid deep uncertainty over how long the coronavirus shutdowns will last.

Citigroup has been testing its loan book against a wide array of economic scenarios, including ones where unemployment reaches 15 percent and US growth contracts by as much as 40 percent, said Chief Financial Officer Mark Mason.

"We would imagine those would be severe-type scenarios," Mason told reporters on a conference call, "but we're in touch across our firm to make sure we can manage that."

Citigroup set aside around $7 billion in the first quarter in case of defaults, leading to a 46 percent drop in profits to $2.5 billion. Revenues rose 12 percent to $20.7 billion.

Bank of America, the biggest US bank by assets after JPMorgan Chase, set aside $4.8 billion for potential defaults, $3.6 billion of which was added in the first quarter.

Bank of America reported quarterly profits of $3.5 billion, down 48.4 percent from the year-ago period.

Meanwhile, Goldman Sachs reported profits of $1.1 billion, down 49 percent from the year-ago period. Revenues dipped one percent to $8.7 billion.

Goldman set aside $937 million during the quarter to deal with potential defaults, citing "continued pressure in the energy sector and the impact of the Covid-19 on the broader economic environment."