Bank Earnings Bonanza
20:38 America/Los_Angeles 15 Jul 2009 
6 Comments
Since Ive had some positive comments about the historical earnings charts that I have been putting up I decided to put up all the upcoming major financials on a post here so that you can reference it all together easily. They show the past 7 quarters earnings results and the stock performance shadowed behind during the same timeframe. I was planning on piece mealing them to you over the next couple weeks, but that just seems evil and boring for me. They are all below in chronological order pertaining to their upcoming earnings date.
And also as a reference below are all of Meredith Whitney’s stock ratings and EPS estimates, since she seems to be the only analyst on the street with half a brain cell especially after having a great estimate on the GS earnings results.
continue to full post for charts……….
JPM – JP Morgan— 7/16 – Thursday
BAC – Bank of America — 7/17 Friday
C – Citigroup — 7/17 Friday
WFC – Wells Fargo — 7/22
MS – Morgan Stanley — 7/22
JPM said Thursday it earned $2.72 billion, or 28 cents a share, in the quarter that closed June 30, up from $2 billion, or 53 cents a share, a year earlier.
While the New York-based bank’s profit soared amid the troubled economy, share earnings fell on a $1.1 billion noncash reduction in earnings applicable to shareholders after Chase paid back its $25 billion in federal bailout funds in June.
Chase (NYSE:JPM) also told investors it set aside $8 billion to cover bad loans, up from about $3.5 billion a year earlier. At the same time, the bank said its revenue grew 39 percent to $25.6 billion from $18.4 billion, due in part to strong performance in its investment banking division. That sector saw revenue jump by a third to $7.3 billion as earnings soared to $1.47 billion.
The bank noted “solid performance” for its retail banking, commercial banking and securities divisions. Those gains, however, were offset by high costs in its consumer lending and credit card divisions, a trend expected to continue into the “foreseeable future,” the company said.
“While we do not know if the economy will deteriorate further, we feel confident that, with our strong capital and reserve levels and significant earnings power, we can continue to reinvest in our businesses and do well for our clients, communities and shareholders over the long term,” CEO Jamie Dimon said in a release.
BAC joined other major banks in reporting better-than-expected second quarter income Friday, earning $2.42 billion even as losses from failed loans continued to rise.
Earnings per share, which reflected a much higher amount of shares outstanding, fell to 33 cents from 72 cents. That was well ahead of the 28 cents per share forecast of analysts surveyed by Thomson Reuters.
The results also reflected a $5.3 billion pretax gain from selling part of the bank’s stake in China Construction Bank Corp. and a charge to bolster a federal deposit insurance fund.
Good article to put bank earnings in perspective from this last quarter:
http://www.fool.com/investing/general/2009/07/17/the-great-bank-earnings-that-really-werent.aspx
Citigroup became the fourth big bank to report strong results for the quarter.
However, Citi’s profit was not driven by improved trading like other banks, and instead came from the gain on the sale of its Smith Barney unit and the increasing values of some of its riskier assets that had plunged during the credit crisis. Citi recorded an after-tax gain of $6.7 billion on the sale of a majority stake in its Smith Barney brokerage unit to Morgan Stanley.
After paying preferred dividends, the New York-based Citigroup earned 49 cents per share versus a loss of $2.59 billion, or 55 cents per share, during the same quarter last year. Analysts forecast a loss of 37 cents per share for the quarter
Morgan Stanley said Wednesday it lost more than $1.2 billion in the second quarter as it took charges to cover continuing losses in its real estate investments and its repayment of government bailout money.
Stripping out one-time items, Morgan Stanley posted a loss of $1.37 a share, much worse than analysts’ average forecast of a loss of 53 cents, according to Reuters Estimates.
We’ll see how the stock finishes today but so far it has rallied from about a 5% gap down to flat at this point.
Wells Fargo said its second-quarter net income rose 81% from the year-earlier period to $3.2 billion, or 57 cents a share. Revenue climbed 28% to $22.5 billion. Wall Street analysts had forecast profit of 34 cents a share on revenue of $20.49 billion, according to Thomson Reuters.
Wells Fargo said net loan charge-offs as a percentage of average loans rose to 2.11% in the second quarter from 1.54% in the first quarter as credit conditions worsened.
“We expect credit losses and nonperforming assets to increase, although we’re beginning to see some moderation in the rate of growth of losses in a number of consumer portfolios, as evidenced by some stabilization in early stage delinquencies,”said Chief Credit Officer Mike Loughlin in the earnings release.
The stock gapped down 7.6% this morning, but has rallied so far to regain half of that gap down. We’ll have to see how it finishes.