Banks’ earnings are expected to have held up well despite low interest rates. Still, the Fed’s policy change means difficult times ahead for most banks.
Earnings season for banks begins Oct. 15, when J.P. Morgan Chase, Citigroup and Wells Fargo are scheduled to announce their third-quarter results, with Bank of America following up the next day.
The financial sector is expected to rank a close second for earnings growth. Considering the boost to earnings per share from stock repurchases, that is unimpressive. The Fed’s threat The Federal Open Market Committee’s decision to make two cuts to the federal funds rate during the third quarter was meant to help reduce the chance of the U.S. economy from slipping into recession, but it is a gloomy development for most banks. It means shorter-term loans that are indexed to short-term rates will reprice at lower rates, reducing lenders’ net interest income. Most banks aren’t positioned to make up for the lost revenue with lower funding costs.
On Oct. 8, bank analysts at Jefferies, led by Ken Usdin, lowered 2019 earnings estimates for 23 of 38 banks, while lowering stock-price targets for 24. Looking ahead, he noted “estimated net income growth flips to negative in ’20 before returning to a modest positive in ’21.”
México Últimas Noticias, México Titulares
Similar News:También puedes leer noticias similares a ésta que hemos recopilado de otras fuentes de noticias.
Brazil BNDES director leaves bank in departure that may impact asset salesA director of Brazilian development bank BNDES responsible for divestments has r...
Leer más »
The big bank winning streak might be about to endDour earnings expectations mark a change from the previous quarter, when big banks returned fat profits despite worries about an economic downturn in the US
Leer más »
Canada's Conservative leader mum on whether central bank governor could get second termCanada's main opposition leader declined to say on Saturday whether he woul...
Leer más »
Public bank is back on the table in L.A. after voters rejected the ideaL.A. City Council President Herb Wesson has proposed creating a public bank owned by the city.
Leer más »
Baby boomers are the most prosperous generation in history. Here are 10 stocks millennials can buy to get in on the action, according to Bank of America.The bank published an updated list of picks for companies exposed to Baby Boomers in the latest update to its 'Primer Picks' list.
Leer más »
How to Deal With Cuffing Season, According to Your SignAt the end of every summer comes a nagging urge to merge.
Leer más »