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Is Bank of America’s Xenophobia Getting In The Way Of Its Earnings?

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It’s Second-Quarter Earnings Results Week (hi-ooo) and Bank of America is poised to disappoint a lot of shareholders as a result of its insistence on doing business almost exclusively in ‘Merica. (Yes, B of A spreads the love in 45 countries but derives only 13% of its revenue from abroad). Analysts estimate that the Bank in America will report a 2% drop in profit, its first decline in 2005. Citigroup, which is among the biggest banks in Mexico, Poland and South Korea and gets nearly half of its sales from abroad, is expected to post an increase of 7.7%. JP Morgan, deriving twenty five percent of revenue from outside the U.S., is predicted to be up 6.4%.
Responding to allegations that B of A has dug its own grave by taking its name too literally (and that it’s not necessarily a great idea to put all your eggs in the ‘Merican basket when the domestic economic has been “growing at sub-3 percent”), CEO Kenneth Lewis offered: “We do better when we play to our strengths, and our strengths are in the U.S.”
Bank of America Profit Trails as Citigroup, JPMorgan Go Abroad [Bloomberg]