Banks

Quarterly profit of US banks may fall back to “pre-normal” levels

Summary

How Healthy are American Banks? (w/ Chris Whalen) Description video: Chris Whalen, chairman of Whalen Global Advisors, dives deep into the current state of the U.S. banking industry. He argues that while American financial institutions have largely recovered from the […]

How Healthy are American Banks? (w/ Chris Whalen)

Description video:
Chris Whalen, chairman of Whalen Global Advisors, dives deep into the current state of the U.S. banking industry. He argues that while American financial institutions have largely recovered from the financial crisis, returns on bank stocks still haven’t recovered to pre-crisis levels. Yet in Whalen’s view, banks will soon face increasing margin pressure as well as, eventually, deteriorating credit conditions. Filmed on August 2, 2019 in New York.\n\nSubscribe now for more videos like this one: https://rvtv.io/2OW3mqu\n\nWatch more Real Vision™ videos: http://po.st/RealVisionVideos\nWatch more by starting your 14-day free trial here: https://rvtv.io/2ISs6L6\n\nAbout Real Vision™:\nReal Vision™ is the destination for the world’s most successful investors to share their thoughts about what’s happening in today’s markets. Think: TED Talks for Finance. On Real Vision™ you get exclusive access to watch the most successful investors, hedge fund managers and traders who share their frank and in-depth investment insights with no agenda, hype or bias. Make smart investment decisions and grow your portfolio with original content brought to you by the biggest names in finance, who get to say what they really think on Real Vision™.\n\nConnect with Real Vision™ Online:\nTwitter: https://rvtv.io/2p5PrhJ\nInstagram: https://rvtv.io/2J7Ddlw\nFacebook: https://rvtv.io/2NNOlmu\nLinkedin: https://rvtv.io/2xbskqx \n\nHow Healthy are American Banks? (w/ Chris Whalen)\nhttps://www.youtube.com/c/RealVisionTelevision\n\nFor the transcript visit: https://rvtv.io/2ISs6L6 \n\nDisclaimer:\nThis is pretty obvious, but we should probably say it anyway so that there is absolutely no confusion…The material in REAL VISION GROUP video programs and publications {collectively referred to as “RV RELEASES”} is provided for informational purposes only and is NOT investment advice. The information in RV RELEASES has been obtained from sources believed to be reliable, but Real Vision and its contributors, distributors and/or publisher, licensors, and their respective employees, contractors , agents, suppliers and vendors { collectively, “Affiliated Parties”} make no representation or warranty as to the accuracy, timeliness or completeness of the content in RV RELEASES. Any data included in RV RELEASES are illustrative only and not for investment purposes. Any opinion or recommendation expressed in RV RELEASES is subject to change without notice. RV Releases do not recommend, explicitly nor implicitly, nor suggest or recommend any investment strategy. Real Vision Group and its Affiliated Parties disclaim all liability for any loss that may arise (whether direct indirect, consequential, incidental, punitive or otherwise) from any use of the information in RV RELEASES. Real Vision Group and its Affiliated Parties do not have regard to any individual’s, group of individuals’ or entity’s specific investment objectives, financial situation or circumstance. RV RELEASES do not express any opinion on the future value of any security, currency or other investment instrument. You should seek expert financial and other advice regarding the appropriateness of the material discussed or recommended in RV RELEASES and should note that investment values may fall, you may receive less back than originally invested and past performances is not necessarily reflective of future performances. Well that was pretty intense! We hope you got all of that – now stop reading the small print and go and enjoy Real Vision.

Quarterly profit of US banks may fall back to “pre-normal” levels

This Friday, the largest US banks will begin publishing their fourth quarter results, which may show that profits fell as much as 40% from a year earlier, even before the pandemic broke out..

Quarterly profit of US banks may fall back to 'pre-normal' levels

But investors will focus on finding clues to expected earnings growth in 2021..

«You can see the fourth quarter as a kind of transitional one by looking at some of the challenges of 2020 in retrospect and looking ahead to an improved 2021.», – said analyst at Barclays Jason Goldberg (Jason Goldberg).

According to Goldberg, the pandemic has caused a sharp drop in interest rates and a record drop in the difference between what lenders charge for loans and what they pay for money..

The pandemic also pushed major US banks to commit more than $ 65 billion to cover expected credit losses..

IBES Refinitiv estimates that from these low values, banks’ profits could more than double in the first and second quarters of 2021.

Bank shares have risen by an average of 35% since the beginning of November. Effective COVID-19 vaccines have since begun to circulate, Democrats have come to power in Washington with promises of more economic stimulus, and the Federal Reserve has said it will allow banks to buy back shares again, which will increase profits per share..

Analysts raised their forecasts for 2021, but as of last Friday they showed that Citigroup Inc reported a 42% drop in fourth-quarter earnings, while Wells Fargo & Co about 39% drop. JPMorgan Chase estimates & Co suggest a more moderate fall of 5%.

These three mentioned above, banks will report their results on Friday.

Bank of America Corp is expected to report a 33% drop in quarterly profit next week.

Morgan Stanley is also expected to grow 1%, while Goldman Sachs Group Inc is expected to grow 43% on the back of the growth in the share of fast-growing companies in the capital markets..