It’s been a busy week for big bank earnings reports, with some better than expected. Two of them are Citi and Bank of America, both of which have exceeded expectations on earnings and other metrics. “Increased regulatory oversight is expected given the failure of the SIVB, but we do not anticipate major changes as the larger banks are well prepared. Smaller banks will bear the brunt of additional regulatory scrutiny You may be made to stand,” by Argus Research. Since the banking crisis began, Bank of America has been down less than 1% year-to-date, down more than 8%, while Citi has recovered some losses and is up more than 4%, It’s up 12% year over year. to date. The following table shows some key indicators such as capital strength, profitability and deposit quality of the two banks. CNBC Pro finds out what analysts are saying about his two largest US banks. Bank of America: ‘Superior Resilience’ Bank of America continues to show ‘Goliath is winning’ theme, Wells Fargo said in his April 18 memo . Wells Fargo analysts led by Mike Mayo said, “His EPS is 13% above consensus in the first quarter of 2023, with excellent resilience in its business model, balance sheet and funding. ” writes. He earned 94 cents a share at the bank, according to Refinitiv, beating Wall Street’s 82 cents estimate. Bank deposits fell 2%, according to Wells Fargo. However, he adds that banks have “deposit tenacity,” highlighting changes in deposit levels, saying, “Overall, the BAC has the lowest beta of the cycle to date with $1.3 trillion in deposits (an estimated 30 %) is an interest-bearing deposit. The problem of uninsured deposits has been in the spotlight since the failure of Silicon Valley Bank, when uninsured deposits exceeded the limits of the Federal Deposit Insurance Corporation. Wells Fargo also noted that Bank of America’s capital markets revenue outperformed its peers, up 1% year-over-year and 30% quarter-on-quarter. Wells Fargo has offered Bank of America his price target of $45. Argus Research’s Bigger said he preferred Bank of America to Citi, but rated both as a buy. “We like the broader diversification of BAC, which helps smooth out periods of weakness in some lines of business depending on the environment,” he told CNBC Pro. but investment banks are weak.Trading is a bigger driver of earnings, as is the very large credit card business.” Citi: ‘A story of turnaround’ Analysts at Wells Fargo, which outperformed expectations by 13%, wrote that they “see the solutions division as Citi’s most important business.” This unit is part of Citi’s Institutional Investors Group and provides cash management and trade finance services. “We feel a bank like Citi will be a differentiator at the start of earnings. [average] Deposits (QoQ slightly increased) and [net interest income] (+1%), including [net interest margin] Wells Fargo gave City a price target of $62. That could be up 24% from Wednesday’s close, less than the gain Bank of America gave. They lag behind their peers on several financial metrics. [return-on-equity] Under the new CEO, we are making sweeping changes to improve our financials, including closing a number of our widespread international operations that were not strategic and often added volatility to our revenue streams,” he said. told CNBC Pro.
