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...Its price to book value of nearly 3 times trumps that for mortgage-heavy Wall Street banks like JPMorgan, Bank of America and Wells Fargo. But Rocket doesn’t have appreciably higher return on equity....
...JPMorgan Chase, Bank of America, Wells Fargo and Citigroup collectively made $253bn in net interest income (NII) for the whole of 2023 — a 19 per cent jump from 2022’s total....
...The sheer size and interconnectedness of capital markets have forced central banks — in 2008, 2020 and 2023 — to become a backstop and buyer of last resort of securities to prop up both the banking sector...
...However banks are displaying forbearance too: Goldman Sachs estimates that $270bn of commercial mortgages which were supposed to mature in 2023 have been extended into 2024....
...Bank of America analysts wrote in a note that higher losses tied to commercial real estate office exposure “are a reminder of ongoing credit normalisation that we are likely to witness across the industry...
...Many top wealth teams inside these banks — and UBS and Bank of America — have left in recent years to create their own independent firms....
...Bank of America analysts said the capital raise and new leadership should “provide breathing room” to the bank....
...According to Michael Youngworth, a convertible bond strategist at Bank of America, a slower than expected fall in inflation is also encouraging companies to issue debt sooner rather than later....
...“In some ways, dry powder is a mirage. It’s a theoretical number,” said Nigel Dawn, global head of private capital advisory at investment bank Evercore....
...For example, if tottering banks cannot tap their local FHLB for funding — and the stigma of going to the Fed’s discount window remains undimmed — this could exacerbate ructions in funding markets as they...
...of America....
...Then at the end of the third year, the mortgage rate would jump to a market rate, and all the interest which you didn’t pay in the first three years would be added to the balance of the loan....
...Need to know: global economy The Bank of Japan ended an era of negative interest rates, lifting borrowing costs for the first time since 2007....
...DZ Bank analysts said in a note to clients that the bank is “currently unable to offset elevated funding costs with higher margins in the lending business”....
...Despite this, in recent days executives from the country’s four largest banks — JPMorgan Chase, Bank of America, Citigroup and Wells Fargo — said during earnings calls that consumers were resilient....
...But, as Ebrahim Poonawala of Bank of America pointed out to me, the cause of the first problem, very fast growth, was acquisitions explicitly designed to solve the second problem, the concentration in regulated...
...Only 15 per cent of its US deposits are in non-interest-bearing accounts. These deposits — the cheapest source of funding for banks — fell 5 per cent between the second and third quarter....
...Meanwhile, the European Central Bank is set to meet next week to discuss the future direction of interest rates amid signs the economy remains mired in stagnation....
...Green mortgages were a particularly strong area of AIB’s green finance growth in 2022....
...At Bank of America, analyst Justin Post has set a target of $204 per share. Amazon is one of the tech companies that has opted to make significant cuts to its workforce since 2023....
...Adding to a squeeze on bank profits is pressure to offer customers higher savings rates to keep their deposits, which are banks’ primary source of funding....
...However, Microsoft’s Azure offering “is the only software business that is benefiting from AI at this point in the cycle”, said Brad Sills, research analyst at Bank of America....
...It is predicted to post a roughly 25 per cent jump in its EPS. Earnings at Bank of America are forecast to be flat....
..., according to estimates from Meghan Swiber, a US rates strategist at Bank of America....
...Bank of America has liquidity coming out of its ears. And if a bank does need liquidity, the Fed’s Bank Term Funding Program, established as a safety valve in March, is still open....
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