Watch your backs

12 April 2018 By Antony Currie Follow @AntonyMCurrie

Tax cuts have already boosted lenders’ bottom lines. Now interest rates, regulatory rollback and volatility are working in their favor. That ought to spell even better results than JPMorgan just reported – unless, that is, the exuberance sparks price wars and excesses.

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Citigroup, JPMorgan and Wells Fargo all reported first-quarter results on April 13.

JPMorgan earned $8.7 billion in the first quarter. At $2.37 a share, the bank beat the consensus estimate of sell-side analysts of $2.28 a share. Revenue of $28.5 billion beat the estimate of $27.7 billion. Annualized return on equity for the quarter was 15 percent.

Citigroup earned $4.6 billion in the three months to the end of March. At $1.68 a share, the bank beat the consensus estimate of sell-side analysts of $1.61 a share. Revenue matched the estimate of $18.9 billion. Annualized return on equity for the quarter was 9.7 percent.

Wells Fargo’s first-quarter earnings were $5.9 billion. At $1.12 a share, the bank beat the consensus estimate of sell-side analysts of $1.06 a share. Revenue of $21.9 billion beat the estimate of $21.7 billion. Annualized return on equity for the quarter was just below 12.4 percent.

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