On April 13, the largest U.S. Bank by assets, JPMorgan was the first in the season of the banks` statements, who provided results for the 1st quarter of 2016 and, frankly, surprised us the decrease in net profit. In comparison with the similar period of last year indicators of NP decreased by 6.7% to 5.52 billion, or $1.35 per share.
Wall Street always pays special attention in the report analysts at JPMorgan, since it first demonstrates earnings from the largest banks in America. Before the presentation, banks were warned about the unstable situation in the markets and about their worries about overall growth. In the end, it’s a deterrent for customers who usually make a significant income from trading operations in the 1st quarter. With all of this, the vast majority of analysts predict the worst start to the year for banks since the financial crisis.
JPMorgan Chase Bank
Returning to JPMorgan, the situation is as follows:
- Income for the first three months of 2016 decreased by 3% and totaled $24 billion;
- Real income with capital base decreased from 14% to 12%;
- Trading of securities with fixed income have brought on 13% less than for the first quarter of last year, and it is $3.6 billion;
- Trade of shares fell by 5% and enriched the Bank at $1.58 billion;
- Corporate and investment banking “earned” for JPMorgan $2 billion, down 22% from last year. Overall, income in this sector fell by 15%, which is extremely disappointing for the largest U.S. bank.
Bank of America
Further, the results of operations in the first half of 2016 showed Bank No. 2 in U.S. by assets Bank of America.
The financial crisis has left its mark on this giant, reducing revenue by 18%. Net income fell to $2,22 billion, while last year during the same period the Bank has earned himself $2,72 billion. The company associates it with a reduction in trading activity in global markets due to falling raw material prices, the slowdown of China’s economy and instability in key interest rates of Central banks.
Company asset management BlackRock
After reports from the most influential banks in the U.S. were financial reports and the other equally influential figures of the financial market of America, which, alas, did not eliminate the situation. The information will be very informative for businessmen who intend to buy the company for asset management this year.
- Profit largest asset management company BlackRock in the first quarter also fell, showing a decline of about 20%;
- Estimating net profit, the company said about fall in NP over the year from $822 million to $657;
- In the first quarter BlackRock managed to raise $36,08 billion net profit, while last year at this same time, the Bank acquired $70,44 billion (figures vary almost in half).
But there is in the report and a glimpse of victory, because, despite the rather passive position of customers, in early 2016 the company has amassed assets worth $4.74 billion compared to $4,65 trillion at the end of 2015. Such statistics undoubtedly suggests that if You in the short term are going to buy a company asset management, will have to think twice about it. Although, if you will try, even in a crisis you can “stay afloat”.
Wells Fargo Bank
Continuing a series of financial reports, the report has provided the largest market value U.S. bank Wells Fargo. Alas, the report was also disappointing.
- The Bank stated a decline in profit in the first quarter of 2016 by 5.9%;
- Net income for the quarter decreased from $5.8 billion to $5,46 billion compared with 2015.
The Bank management explains the situation of need money for overdue loans, and increases in costs. CEO John Stumpf also said it plans to carefully monitor expenses, and, in parallel, to increase the number of deposits and expand their loan portfolios.
In conclusion, the international community ascertained in unfavourable situation on the financial market in the first half of 2016, associated with the collapse of raw materials prices, a decrease in customer activity and increased expenses. We only can advise to the businessmen who planned to buy company asset management, Bank or other financial institution to postpone the decision, or to build “iron” the pattern of development that is highly protected from market fluctuations.