Bank of America Corp (NYSE:BAC), the largest American bank by assets, just announced second quarter earnings. A quick roundup of the report is:
- BofA gained a total profit of 19 cents per share which beats analyst estimates of 14 cents but does not even come close to the earnings of the loss-ridden JPMorgan (NYSE:JPM) and the up and coming banking leader Wells Fargo & Company (NYSE:WFC). JPM posted a profit of 121 cents per share while WFC made 82 cents per share. Goldman Sachs (NYSE:GS) earnings beat analyst expectations but the profits reduced 11% to 178 cents per share in this quarter.
- The net income of the bank amounted $2.5 billion for this quarter, which is a breath of fresh air, as only losses were reported in the corresponding quarter of 2011 that equaled $8.83 billion, or 90 cents a share.
- Revenues rose to $22.20 billion, from $13.48 billion a year ago. The estimates of revenues paralleled analysts expectations of $22.87 billion. When compared with other banks, Goldman Sachs revenue was $6.63 billion, down 9% from a year ago.
- BofA decreased its expenses by 26% to $17 billion from $22.9 billion.The bank got a big boost from lending, which increased for the sixth straight quarter.
- The total loans of BofA in this quarter fell 5.2% from the previous year and 1% from the first quarter of 2012. While JPM showed a 5% and 1% growth when compared to the previous year and the previous quarter respectively. Citigroup and Wells Fargo also reported increase in their loan portfolio.
Shares of Bank of America gained nearly 2% in premarket trading. CEO Brian Moynihan referred to the bank’s plan to cut expenses and emerge as a leaner operation, which he called “new BAC.” The bank is getting a boost from lending, which has risen consistently for the sixth quarter, and is gradually shaking off the after-effects of the Countrywide acquisition. WFC and JPM clearly overshadow BofA earnings, but it is also unfair to make a comparison with the leaders, when BofA has seen a rough couple of years now.
ValueWalk's Raul Panganiban interviews JP Lee, Product Managers at VanEck, and discusses the video gaming industry. Q4 2020 hedge fund letters, conferences and more The following is a computer generated transcript and may contain some errors. Interview With VanEck's JP Lee ValueWalk's ValueTalks ·
Other banks that reported earnings today were:
- PNC Financial Services Group Inc. (NYSE:PNC), the seventh largest bank by assets, reported a 40% decline in profits that amounts to 98 cents a share and equals to $546 million, as opposed to $912 million, or $1.67, a year earlier. Revenue for this quarter increased by 1 percent to $3.62 billion. The decline in profits is attributed to mortgage-putback demands.
- The Bank of New York Mellon Corp. (NYSE:BK) also reported their quarterly earnings with a decline of 37 percent in income, from $735 million to $466 million, or 39 cents a share this quarter, from 59 cents a share last year. Total revenue was $3.62 billion, which is a 6% fall from the same quarter last year. Total assets rose 2% to $1.3 trillion.
- US Bancorp (NYSE:USB) beat earning estimates by reporting a net income of $1.42 billion, or 71 cents per share, which is an 18% increase from last year’s profit of 60 cents per share. Revenues grew 8 percent, to $5.07 billion. The second quarter earnings synchronize with the analysts’ estimates of 70 cents a share profit, and revenue of $4.98 billion.
Stay tuned to get latest updates on quarterly earnings of Morgan Stanley (NYSE:MS) releasing tomorrow, Thursday July 19th.