On Tuesday, JPMorgan and Goldman Sachs released their Q2 results before the US market open – both beating analyst expectations. Today, Bank of America, Citigroup and Wells Fargo & Co released their numbers for the previous quarter before the opening bell.
Bank of America
Bank of America reported a total revenue of $21.6 billion in Q2, slightly below analyst forecast of $21.8 billion. Earnings per share were reported at $1.03 per share which was above analyst estimate of $0.76 per share.
“Despite the continued challenge of low interest rates, the diversity and leadership positions of our eight lines of business enabled us to benefit from a faster economic recovery this quarter,” Bank of America CFO Paul Donofrio said in a statement. “We believe our continued focus on client selection and responsible growth has positioned us well.”
“At the same time, our balance sheet remains a source of strength, as supported by our performance in the most recent stress tests, which showed significant excess capital. We returned nearly $6 billion this quarter in common dividends and share repurchases and we expect to return a higher amount in the coming quarters, while we continue to deliver for our clients and the communities that we are so fortunate to serve.”
Share price of Bank of America trading lower during today’s session, down by around 3.8% at $38.34 per share. The stock is up by around 58% in the last year.
Citigroup beat analyst predictions after reporting total revenue of $17.47 billion. Analysts predicted total revenue of around $17.20 billion. Earnings per share also came in higher at £2.85 per share vs. forecast of $1.96.
Jane Fraser, Citigroup CEO commented on the latest results following the announcement – “The pace of the global recovery is exceeding earlier expectations and with it, consumer and corporate confidence is rising. We saw this across our businesses, as reflected in our performance in Investment Banking and Equities as well as markedly increased spending on our credit cards. While we have to be mindful of the unevenness in the recovery globally, we are optimistic about the momentum ahead.”
“During the first half of the year, we returned nearly $7 billion in capital to our shareholders, the most that was permitted by the Federal Reserve. We ended the quarter with a Common Equity Tier One ratio of 11.9% and we intend to continue to return our excess capital, over and above the amount we need to make strategic investments. We are making progress on our strategy refresh across our consumer and institutional businesses. Our overarching goal is to increase the returns we generate and close the gap with our peers. We have set out to modernize our bank and want to achieve nothing less than excellence in our risk and control environment, our operations and our service to clients.”, Fraser added.
Citigroup little changed during today’s session, down by 0.83% at $67.80 per share. The share price is down by 9% in the last 30 days.
Wells Fargo & Co
Wells Fargo also posting better than expected results with total revenue at $20.27 billion in Q2, way above analyst forecast of $17.77 billion. Earnings per share also coming in higher at $1.38 vs. a forecast of $0.97 per share.
CEO of Wells Fargo, Charlie Scharf commented on the Q2 results – “Wells Fargo benefited from the continued economic recovery, strong markets that helped drive gains in our affiliated venture capital businesses, and our progress on improving efficiency, but the headwinds of low interest rates and tepid loan demand remained.”
“Credit quality continued to be exceptionally strong. Our results included a $1.6 billion pre-tax reduction in the allowance for credit losses, and charge-offs continued to decline. While we expect charge-offs will increase at some point, we continue to see strong trends in all of our businesses.”
Well Fargo trading higher following the strong Q2 results, up by 1.69% at $43.96 per share. The stock is up by over 80% in the last year.
Morgan Stanley (MS) report their Q2 results tomorrow.
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Sources: Bank of America, Citigroup and Wells Fargo & Co, Refinitiv, TradingView
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