Fri, Oct. 21, 4:24 PM
Mon, Oct. 17, 9:52 AM
- Customers of offerings like JPMorgan's (NYSE:JPM) Sapphire Reserve card can't believe their good fortune, but bank shareholders can't be faulted for wondering whether there's going to be any profits from the growing rewards war.
- "You have five or six big national players and they are going around killing one another," says Oppenheimer's Chris Kotowski.
- It's the banking version of a loss leader. The upfront rewards are well above the annual fee, but if customers hold onto the card after the first year, and better yet hold a balance, they could become profitable.
- "It has been a huge success," says the bank's card boss, Kevin Watters. Speaking on Friday's earnings call, CFO Marianne Lake declined to say how much card debt customers need to take on before a profit can be turned.
- Citigroup's (NYSE:C) spending on cards has also been aggressive, but personal finance gurus say its Prestige premium card needs to up its rewards game to compete with JPMorgan's offering.
- Bank of America (NYSE:BAC) and Wells Fargo (NYSE:WFC) also naturally want to boost card business, but until now have mostly refrained from joining the war, and earlier this month, American Express (NYSE:AXP) boosted rewards on its Platinum card, though saying publicly the move wasn't in response to JPMorgan and Citi.
Fri, Oct. 14, 11:24 AM
- Speaking to reporters ahead of the bank's 11:30 ET earnings call, CFO John Gerspach says Citigroup (NYSE:C) hasn't identified any sales abuses similar to those at Wells Fargo. Presentation slides
- Earlier: JPMorgan CFO Marianne Lake said her bank found nothing systemic, but acknowledged "zero defects" isn't a reasonable expectation.
- In other comments from Gerspach, he says the woes of Deutsche Bank have helped boost Citi's market share, and sees Citi rising to fifth or sixth in equity trading ranking. In the bank's Q3 results, bond-trading revenue jumped a full 35% Y/Y, but equity revenue slumped 34%. "Not particularly pleased" with the results, Gerspach says Citi remains committed to growth at the unit. "This is a process." (Is he applying to be the 76ers GM?).
- Up sharply earlier, the banks are giving back some ground, with JPMorgan and Wells Fargo now red, and Citi higher by just 0.35%.
Fri, Oct. 14, 8:11 AM
- Q3 net income of $3.8B or $1.24 per share vs. $4.3B and $1.35 a year ago. Revenue of $17.8B fell from $18.7B. Excluding CVA/DVA, revenue fell 4% Y/Y and EPS fell 5%.
- Global Consumer Banking revenue of $8.227B up 1% Y/Y. Expenses of $4.44B up 5%. Reserve build of $433M vs. a release of $102M a year ago. Provisions of $25M down 11%. Net income of $1.285B down 24%.
- Institutional Clients Group revenue of $8.628B flat Y/Y. Investment banking revenue of $1.086B up 15%. Fixed income markets revenue of $3.466B up 35%. Adjusted net income of $2.753B up 20%.
- Citi Holdings revenue of $877M down 49% Y/Y. Assets of $61B down 48% Y/Y and 8% Q/Q. Agreements to sell another $10B were signed since the end of the quarter.
- CC at 11:30 ET
- Previously: Citigroup beats by $0.08, beats on revenue (Oct. 14)
- C +1.5% premarket
Fri, Oct. 14, 8:00 AM
Thu, Oct. 13, 5:30 PM
Tue, Oct. 11, 4:56 PM
- General Electric (NYSE:GE) and Citigroup (NYSE:C) provided tax equity financing to the U.S.’s first offshore wind farm, a 30 MW project recently completed off Rhode Island, the project's developer said today.
- Deepwater Wind announced the financing from GE Energy Financial Services and Citi without disclosing the amount; D.E. Shaw provided ~$70M in equity financing for the project, and Societe Generale and KeyBank provided $290M in debt financing.
- A separate GE unit, GE Renewable Energy, supplied the five wind turbines for the $300M project and will provide long-term maintenance service.
Sun, Oct. 9, 12:26 PM
- Citi (NYSE:C) says sale involves about $1.4B in assets, including credit cards, personal loans, Citi Argentina’s retail brokerage business and deposit accounts.
- Says sale won’t be material to earnings, doesn’t disclose terms.
- Citi to maintain corporate, corporate, investment banking business in Argentina.
- Yesterday, Citi said it had sold its Brazilian operations to ITUB.
Sat, Oct. 8, 8:34 AM
- Citi's (NYSE:C) consumer businesses in a number of South American countries have been on the block for a while, and a deal for at least one of them had been expected about now.
- The sale of the Brazilian operation to ITUB constitutes about $2.8B in assets, and includes credit cards, personal loans, and deposit accounts, as well as the bank's retail brokerage business there. The terms of the purchase will not be material to Citi's earnings.
- Citigroup, of course, will continue to operate in Brazil serving corporate, investment bank, commercial bank, and private bank clients.
Thu, Oct. 6, 11:14 AM
- Sandler O'Neill's Jeffrey Harte's earlier reported valuation-based downgrade of JPMorgan (JPM -0.8%) also comes with a recommendation to consider less expensive and less widely-owned TBTF names like Bank of America (BAC -0.2%) and Citigroup (C -0.3%).
- Turning back to JPMorgan and its Q3 earnings set for release on October 13, Harte, sees a 4% sequential decline in revenues to $24.2B, with Consumer and Community Banking revenues down 2%, and Corporate & Investment Banking revenues down 11% (thanks to seasonal factors).
- Look for expenses to be up 4%, but down 1% ex-legal costs.
Tue, Oct. 4, 2:19 PM
- A Bloomberg report says the ECB is likely to gradually wind down bond purchases ahead of the scheduled March 2017 end of its QE program. The central bank is currently buying €80B per month of government and corporate paper, and may begin to slow that amount by €10B per month, according to the story.
- Yields are higher in Europe and the U.S., with the 10-year U.S. Treasury up five basis points to 1.675% and the German 10-year Bund yield is up four bps to -0.048%. TLT -1.1%, TBT +2.2%
- Though the Dow and S&P 500 are each lower by 0.5%, the yield-starved XLF is up 0.6%, with Bank of America (BAC +2.1%), Citigroup (C +1.9%), and JPMorgan (JPM +0.4%) leading the way. Shrouded in scandal, Wells Fargo (WFC -0.2%) continues to underperform.
- Other names: Regions Financial (RF +1.5%), KeyCorp (KEY +2.1%), BB&T (BBT +1.4%), Schwab (SCHW +1.5%), MetLife (MET +1.1%), Prudential (PRU +1.3%).
- 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, DPST, FAZZ, FNCF
Mon, Oct. 3, 9:04 AM
- September monthly performance was: +0.5%
- 52-week performance vs. the S&P 500 is: -3%
- $0.04 in dividends were paid in September
- Top 10 Holdings as of 6/30/2016: JPMorgan Chase & Co (JPM): 3.02927%, US Treasury Note 1.125%, Citigroup Inc (C): 2.72752%, Bank of America Corporation (BAC): 1.75979%, General Electric Co (GE): 1.64495%, Apache Corp (APA): 1.43672%, Merck & Co Inc (MRK): 1.40565%, Royal Dutch Shell PLC Class A (OTCPK:RYDAF): 1.39841%, Morgan Stanley (MS): 1.39796%, US Treasury Note 0.625%
Fri, Sep. 30, 11:37 AM
- The ADRs of Deutsche Bank are higher by 15% on a report it's near settling U.S. mortgage-related charges for just $5.4B (versus the $14B which had previously been floated).
- The move has lifted Europe out of the red, led by Germany's (NYSEARCA:EWG) 1% gain. The Dow's (NYSEARCA:DIA) 1% advance is leading the U.S. averages higher.
- Bank of America (BAC +3.1%), Citigroup (C +3.2%), JPMorgan (JPM +1.7%), Wells Fargo (WFC +0.7%), Goldman Sachs (GS +1.7%), Morgan Stanley (MS +2.9%). XLF +1.5%
Thu, Sep. 29, 3:35 PM
- Deutsche Bank's (DB -6.5%) steep tumble has stabilized a bit over the past couple of hours, but DoubleLine bond guru Jeffrey Gundlach says it's got a ways left to go and to stay away.
- The company is hard to analyze and the prospect of a government bailout, he tells Reuters. The market sell-off "doesn't feel like" it's over by any means.
- "The market is going to push down Deutsche Bank until there is some recognition of support," he says.
- Elsewhere in sliding financials today: BAC -1.1%; C -2.1%; JPM -1.4%; GS -2.7%; MS -2.2%; OTCPK:SCGLY -3.8%.
Thu, Sep. 29, 1:30 PM
- A report that a number of hedge funds are bailing out of their Deutsche Bank exposure has sent that stock sharply lower in the last few minutes, and the move is dragging the big U.S. banks, and in turn, the major averages.
- Deutsche is now lower by more than 7%. Bank of America (BAC -1.2%), Citigroup (C -1.6%), JPMorgan (JPM -1.2%), Goldman Sachs (GS -2.1%), Morgan Stanley (MS -1.9%). The KBE and KRE are each off 1.1%.
- The Dow (DIA -0.9%), S&P 500 (SPY -0.8%), and Nasdaq (QQQ -0.6%).
Wed, Sep. 28, 9:32 AM
- "Large banks are going to be forced to take on more capital," says Dick Bove. "It will make the cost of funding more, not less, expensive. It will reduce the appeal for investors to put money at risk in the banking system."
- Bove is commenting on a weekend announcement from Fed Governor Daniel Tarullo promising future stress tests will be geared to demanding even higher cash buffers for banks. Set to take effect next year, the new rule could raise capital requirements for the largest banks by 3 or 4 percentage points, writes Jeff Cox at CNBC.
- Interested parties: BAC, C, WFC, JPM, GS, MS
- There's good news though, as those lenders with less than $250B in assets won't be subject to the same standards. FBR's Edward Mills calls it a "significant positive" for regionals, which now have more certainly on the process, reduced regulatory expenses, and thus the ability to return more capital to owners.
- Interested parties: RF, ZION, CMA, KEY, FITB, STI, NYCB, HBAN, PNC, BBT, MTB
- ETFs: KRE, KBE, IAT, KBWB, QABA, KBWR, KRU, PSCF, KRS, WDRW, DPST