The first quarter was a good one for banks. It’s a “boom,” Jamie Dimon said as his bank notched a five-fold increase in profits. “Stunning,” an analyst said of Goldman Sachs’s M&A and trading-driven triumph. Morgan Stanley, which reports tomorrow, may disappoint its CEO by failing to set another record (although, given how things are going it may well do that, too), but is likely to offer more of the same.
Still, what does that really tell us? The haves are having, the aristocrats are high on the hog; what else is new? To really get a sense of how good the first quarter was, we’ve got to get down and dirty with the mugs, the also-rans, the sad-sacks, the (relative) losers mucking about the gutters of Wall Street. And when we do brace ourselves for the smell and get our wingtips muddy, we find that indeed it is true: The first quarter was a wonder, enough to slap an alluring coat of lipstick on even these pigs.
Profits at the [Wells Fargo] rebounded to nearly $5 billion in the first quarter of 2021 as the improved economic outlook allowed it to cut its cushion for losses on pandemic-hit loans by $1.6 billion, and as it got a grip on costs relating to fixing its product mis-selling scandals…. "There are probably investors that are viewing today's results as Wells Fargo turning a corner. There is good reason to be optimistic," said Edward Moya, Senior Market Analyst at forex platform Oanda.
The Charlotte, N.C.-based lender on Thursday posted earnings of $8.05 billion for the first quarter. That compared with $4.01 billion a year earlier, when banks took big hits to their earnings to begin stockpiling rainy-day reserves at the beginning of the pandemic.
Bank of America made 86 cents a share, beating the 66 cents forecast in a FactSet poll of analysts.
Wells Fargo starts to emerge from sales scandal as first-quarter profit jumps [Reuters]
Bank of America Profit Doubles After It Releases Reserves for Bad Loans [WSJ]
Banks, After Bracing for Disaster, Are Now Ready for a Boom [WSJ]
Second Stage Of Big Bank Earnings Ahead As Bank Of America, Citigroup, Morgan Stanley Report [Forbes]