Wed, Jun. 8, 3:17 PM
- The bank employs 9K in the U.K., but said it could look to spread some of that out across the EU in event of a Brexit, according to Reuters, citing an internal memo.
- Citi's (NYSE:C) attitude echoes that of JPMorgan boss Jamie Dimon. who last week said up to 4K of his bank's 16K U.K. jobs could vanish following a Brexit.
Mon, Jun. 6, 3:28 PM
- "It's a machine, no doubt about it," says one getting disgruntled customer of Wells Fargo (NYSE:WFC), which is one of only two U.S. companies which have produced at least $5B of net income in each of the last 14 quarters (Apple is the other).
- Worrying analysts though is that customers like the one above - his family has nine Wells products - appear to have had their fill, writes Ben McLannahan in the FT. Wells' lauded cross-sell ratio has fallen from an average of 6.36 products per household in Dec. 2013 to 6.29 a the end of last year."
- While the bank trades at a premium to U.S. peers in terms of multiple of net assets, that premium has shrunk to half the level of two years ago, and Wells recently cut some financial targets.
- Without a big rise in interest rates, says Standard Life's Chris Haimendorf, "it is very difficult to see how things can get even better from here."
- CEO John Stumpf - though acknowledging the low-rate issue - says there are plenty of avenues for growth. He notes peers like BofA (NYSE:BAC) and Citigroup (NYSE:C) closing branches or even pulling out of certain cities. Wells, on the other hand, is keeping its footprint, but adjusting its format with smaller "bodega branches."
- Stumpf: “All of our new account acquisition happens at one of our branches. If you shut that down, at least today, you shut down your front engine."
Mon, Jun. 6, 11:08 AM
- Massive capital builds (and returns) after 2017 for all of the money-center banks should add four or even five percentage points to EPS growth, says Portales Partners' Charles Peabody, figuring Citigroup (NYSE:C) for $90 stock by 2020.
- In the short term, though, energy-related loan losses could be a headwind. Peabody sees reserve builds of up to 15% over the next two years vs. typical provisions of just 5% for the global banks.
Mon, Jun. 6, 3:44 AM
- Goldman Sachs (NYSE:GS) received more than a quarter of a million applications from students and graduates for jobs this summer, a rising number that is way more than the bank could ever employ.
- The trend is mirrored at several other large banks such as JPMorgan (NYSE:JPM), Morgan Stanley (NYSE:MS), BofA (NYSE:BAC) and Citigroup (NYSE:C).
- According to figures provided to the Financial Times, the number of these applications has risen more than 40% globally since 2012.
Fri, Jun. 3, 9:47 AM
- At the moment, it's looking like "wait till next year," for the higher interest rates much of the yield-starved financial sector has been waiting for. This morning's disappointing jobs numbers has traders quickly reversing bets on a rate hike this summer.
- Meanwhile, the 10-year Treasury yield has crumbled to a two-month low of 1.70%.
- The XLF is down 1.9%, leading the S&P 500's 0.5% decline. The SPDR KBW Bank ETF (KBE -3.5%), the SPDR Regional Banking ETF (KRE -3.4%).
- Among the Too Big To Fail names, Bank of America (BAC -4.7%) and Citigroup (C -4.8%) are hardest hit. In regionals, Regions Financial (RF -4.4%), KeyCorp (KEY -4%), BB&T (BBT -3.3%), Fifth Third (FITB -4.4%).
- State Street (STT -3.5%), Northern Trust (NTRS -3.8%), Schwab (SCHW -5.4%), E*Trade (ETFC -5.8%), Ameritrade (AMTD -5.5%), MetLife (MET -3.6%), Prudential (PRU -3.2%), Lincoln Financial (LNC -4.1%)
- ETFs: XLF, FAS, FAZ, KRE, UYG, VFH, KBE, IYF, BTO, IAT, IYG, FNCL, SEF, FXO, KBWB, QABA, KBWR, RYF, FINU, KRU, RWW, XLFS, FINZ, KRS, JHMF, WDRW, FAZZ, DPST, FNCF
Thu, Jun. 2, 11:24 AM
- In separate public comments today, Fed governors Daniel Tarullo and Jerome Powell said the Fed will require the eight largest U.S. banks to hold even more capital if they want to pass stress tests.
- The goal, says Powell, is to make capital requirements so difficult that the largest lenders have to honestly assess whether it would be a better idea to break themselves up.
- For now, the Fed is going to make 2015's capital surcharges permanent, which alone makes things tougher. "Really quite significant, probably the most significant additional potential capital requirement on the horizon." says former OCC Director John Dugan.
- The eight: Bank of America (BAC -0.1%), Citigroup (C -0.3%), JPMorgan (JPM -0.4%), Morgan Stanley (MS -0.7%), Wells Fargo (WFC -0.5%), State Street (STT -0.7%), Goldman Sachs (GS -0.7%), BNY Mellon (BK -0.5%)
Thu, Jun. 2, 7:45 AM
- May monthly performance was: +1.13%
- 52-week performance vs. the S&P 500 is: -3%
- No dividends were paid in May
- Top 10 Holdings as of 3/31/2016: JPMorgan Chase & Co (JPM): 2.92%, US Treasury Note 1.125%, Citigroup Inc (C): 2.72%, US Treasury Note 0.5%, General Electric Co (GE): 2.16%, Bank of America Corporation (BAC): 1.79%, Morgan Stanley (MS): 1.36%, Target Corp (TGT): 1.36%, US Treasury Note 1.625%, Carnival Corp (CCL): 1.29%
Fri, May 27, 7:32 AM
- With buyers of LendingClub's (NYSE:LC) loans pulling back after the resignation of the CEO, the company is in talks with Citigroup (NYSE:C) about that bank being a new source of funding, according to a WSJ report.
- The two already have a relationship where Citi buys loans from LC's platform to help meet its community lending requirements. Citi was also a big buyer of loans from Prosper Marketplace, but has pulled back after pricing on a securitization fared poorly.
- Prosper is now reportedly involved in a discussion of strategic alternatives.
- LC +3.2% premarket to $4.51.
Thu, May 26, 3:15 PM
- All banks in the team's coverage universe have plenty of room for capital return, says analyst John McDonald, expecting some to have sufficient cushions to be able to move payout ratios (dividends and buybacks) to close to 100% of earnings.
- Those most likely to have solid increases in payouts are Bank of America (NYSE:BAC), BB&T (NYSE:BBT), PNC FInancial (NYSE:PNC), and Citigroup (NYSE:C). Those with the least cushion are U.S. Bancorp (NYSE:USB), JPMorgan (NYSE:JPM), and Regions Financial (NYSE:RF).
Wed, May 25, 10:28 AM
- About half of all share sales by public companies this year have been block trades, writes Corrie Driebusch, versus an average of about one-third over the past five years, and just one-fifth over the past decade.
- To review, a block trade involves a bank buying a large chunk of stock from a company or its P-E backers at a discount, in the hopes of unloading it piece-by-piece later that day at a markup.
- The increase in block trades, of course, comes as business slows at any number of other bank profit centers, particularly fixed-income trading.
- For the most part, block deals have mostly proved profitable this year, with an average one-day return of 0.5%, according to Dealogic. The leaders in U.S. block trades this year are Credit Suisse (NYSE:CS) and JPMorgan (NYSE:JPM), with Deutsche Bank (NYSE:DB), Bank of America (NYSE:BAC), and Citigroup (NYSE:C) also notable participants.
Wed, May 25, 9:25 AM
Fri, May 20, 9:18 AM
- U.S. credit card balances are on track to climb over $1T this year, closing in on the all-time high of $1.02T set just before things fell completely apart in 2008.
- Slow, but steady economic growth, an improving job market, and lenders returning to offering credit to millions of subprime consumers are behind the numbers.
- Lenders will take it where they can get it, as credit cards are one of the few areas working for banks right now, thanks to low margins on ordinary lending and a secular decline in trading profits. For now, delinquency rates are low, and profits are set to rise even more alongside Fed rate hikes.
- Capital One's (NYSE:COF) strategy to boost card usage by raising spending limits and giving out new cards is paying off: The bank's customers spent 20% more on cards in Q1 this year than last. For Citigroup (NYSE:C), average balances posted their first Y/Y increase since 2008. Balances grew at Discover (NYSE:DFS) and JPMorgan (NYSE:JPM) as well.
- Even American Express (NYSE:AXP), whose customers typically pay it all off every month, is now focusing on lending to those who will keep a balance.
- Source: The WSJ's Annamaria Andriotis and Robin Sidel
Wed, May 18, 1:08 PM
- The meme of rates lower for longer has been stood on its head in the last 24 hours thanks to some decent economic data, but also surprisingly hawkish Fedspeak yesterday.
- The fixed-income world now believes remarks from the Fed's Williams and Lockhart yesterday may have been a preview of what we'll get when the real power speaks tomorrow - Fischer and Dudley - and then on May 27, when Janet Yellen gives a speech.
- Up at 2 ET are the minutes from the FOMC's April meeting.
- The 10-year yield is higher by five basis points to 1.82% and short-term rate markets have upped expectations for a Fed move this year.
- XLF +1.85%, KBE +3.15%, KRE +3.3%
- Bank of America (BAC +3.7%), Citigroup (C +4.2%), JPMorgan (JPM +3.2%), Wells Fargo (WFC +2.1%), U.S. Bancorp (USB +2.1%), Regions (RF +3.3%), KeyCorp (KEY +3.7%), PNC Financial (PNC +2.7%), Fifth Third (FITB +3.7%), Capital One (COF +1.9%), E*Trade (ETFC +4.4%), Schwab (SCHW +4.8%), MetLife (MET +2.9%), Prudential (PRU +3.4%), Lincoln National (LNC +4.2%), BNY Mellon (BK +2.3%), Northern Trust (NTRS +2.9%)
Mon, May 16, 12:10 PM
- Leon Cooperman's Omega Advisors sold its roughly 3M share stake in Citigroup (NYSE:C) in Q1, which had accounted for about 3.4% of the fund's holdings.
- He took new stakes in PayPal Holdings (NASDAQ:PYPL), UnitedHealth (NYSE:UNH), Coach (NYSE:COH), Lowe's (NYSE:LOW), Autozone (NYSE:AZO), and Electronic Arts (NASDAQ:EA).
- Cooperman also cut his FANG exposure, selling more than 50% of his Facebook (NASDAQ:FB), and about one-third of his Google (GOOG, GOOGL).
- While the 13F also shows a new 227K share stake in Apple (representing 0.7% of the total portfolio), CNBC reports that holding has since been sold.
Mon, May 16, 11:07 AM
- The bank sold high-frequency trading business Automated Trading Desk (ATD) to Citadel for undisclosed terms. Citi (NYSE:C) purchased the operation in 2007 for about $680M.
- Banks used to be the dominant players in the wholesale market-making business, but Citi has joined Goldman, BofA, Credit Suisse, and Wells Fargo in exiting, in part, thanks to plenty of regulatory pressure.
- "Banks just can’t compete,” says Citadel's Jamil Nazarali. “Competitive pressure has been strong over the past few years.”
Thu, May 12, 12:33 PM
- Value-at-risk at JPMorgan (NYSE:JPM) jumped 50% amid Q1's volatility, reports Bloomberg. It's a figure standing in sharp contrast to declines of 25% or more at Bank of America (NYSE:BAC), Citigroup (NYSE:C), and Deutshce Bank (NYSE:DB), and smaller falls at UBS, Goldman Sachs (NYSE:GS), and Morgan Stanley (NYSE:MS).
- For Bank of America, it says the risk in its trading portfolio in Q1 was the lowest in any quarter since the Merrill Lynch merger in 2009.
- While cutting VaR reduces risk, it also limits profits, and in past times. notes a former Fed bank examiner turned college teacher, banks used episodes of higher volatility to step in and make money. In a Dodd-Frank world, making money in this fashion may not be received well by regulators.
Citigroup, Inc. is a global financial services holding company that engages in the provision of financial products and services to consumers, corporations, governments, and institutions. It offers savings, checking, online banking, individual retirement accounts, and private banking products and... More
Industry: Money Center Banks
Country: United States
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