Sure, a record $1.02 trillion in U.S. credit card debt gives banks the chance to earn higher interest.

But it also raises the risks that customers won't be able to repay what they've borrowed, which may prompt the largest U.S. lenders to boost reserves against losses by an average of 3 percent when they begin reporting financial performance for the end of 2017 on Friday, estimated Susan Roth Katzke, an analyst at Credit Suisse.

Average loss rates on credit card accounts at three of the largest U.S. banks, JPMorgan Chase, Bank of America, and Citigroup, may have reached 2.46 percent in the three months through December, Katzke said in a report on Monday. That's an increase of less than 1 percent from the three months through September, reflecting relatively stability.

Still, total U.S. card debt for November — reported by the Federal Reserve on Monday — increased 13.3 percent and combined with rising interest rates, may leave more borrowers struggling. The U.S. central bank has boosted rates five times since the end of 2018, to a range of 1.25 percent to 1.5 percent, and expects three more hikes this year.

"There's only so much credit card debt Americans can absorb without it causing real problems," Matt Schulz, a senior industry analyst at, said in a statement. "Right now, delinquencies are still fairly low, but they're climbing. A mix of increased card debt and higher interest rates means that climb will probably accelerate in 2018. That could mean big trouble for many Americans."

In the most recent quarter for which banks have reported earnings, JPMorgan Chase boosted loss reserves on its card accounts by $300 million, Chief Financial Officer Marianne Lake told investors in October.

"Charge-offs increased in line with expectations," she said at the time. The largest U.S. lender and the first of the major banks to report earnings for 2017, JPMorgan, is expected to report earnings of $6.83 a share, an increase of 10 percent from the previous year, on revenue of $103 million, according to analysts surveyed by FactSet.