Three major banks are bracing for an economic downturn in 2023, including an uptick in unemployment, even as they continue to benefit from strong consumer spending and higher interest rates.

Why it matters: The banking industry's convergence on the 2023 outlook comes after a period of widespread disagreement among corporate executives, economists and the public over the trajectory of the economy.

The big picture: Executives from JPMorgan Chase, Bank of America and Citigroup all said Friday on earnings calls that they're planning for a "mild recession" this year.

• Chase, Bank of America and Citigroup are projecting a peak unemployment rate of 4.9%, 5.5% and 5%, respectively, executives told investors.
• Bank of America CEO Brian Moynihan said the company expects "a rapid rise" in joblessness to start the year, though he acknowledged the prediction is "much more conservative than the economic estimates that are out there."

Reality check: The major banks reported strong results in the fourth quarter for their consumer banking divisions (think credit cards, bank accounts and loans).

• Chase reported net income of $4.54 billion in its segment, up 9.5% from a year earlier.
• Bank of America enjoyed record net income in its consumer banking division, posting a profit of $3.58 billion, up 14.5% from a year earlier.

Investors liked what they saw.

• Shares of JPMorgan, Bank of America and Citigroup all closed up over 2%.

Keep in mind: Consumers are borrowing more to sustain their level of spending. And higher rates are allowing banks to charge more on loans.

• Both factors are fueling bank revenues and profits.
• Card loans rose 19% at Chase, returning balances to pre-pandemic levels, while they jumped 13% at Citigroup.

The bottom line: Banks are enjoying higher interest rates and strong consumer spending, but they expect the momentum could soon recede.