One-Time Charges Concealed How Well Big Banks Did During The Last Quarter Of 2023
Portfolio Pulse from Upwallstreet
The major U.S. banks JPMorgan Chase, Wells Fargo, Bank of America, and Citigroup reported their Q4 2023 earnings with mixed results due to one-time charges. Bank of America's profit fell short of expectations, while Wells Fargo saw a rise in credit loss provisions and warned of a net interest income drop. JPMorgan Chase reported its best ever annual profit, and Citigroup reported its worst quarter in 14 years but is optimistic about 2024 after restructuring.
January 12, 2024 | 8:42 pm
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NEGATIVE IMPACT
Citigroup reported a net loss of $1.8 billion for Q4, its worst quarter in 14 years, due to one-time charges. Plans for job cuts could lead to future savings, with optimism for 2024.
The significant net loss and job cuts announcement may create negative sentiment in the short term, despite the long-term savings plan and optimistic outlook for 2024.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 80
NEGATIVE IMPACT
Wells Fargo's shares fell after Q4 earnings, with a rise in credit loss provisions and a warning of net interest income drop for 2024. However, consumer spending and market share improved.
The negative guidance for 2024 net interest income and increased credit loss provisions are likely to weigh on investor sentiment, leading to a negative short-term impact.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 80
NEUTRAL IMPACT
Bank of America's Q4 profit dropped due to one-off charges, with adjusted profit slightly topping estimates. Interest rate headwinds partially offset by growth and cost management.
While BAC's reported profit fell, the adjusted figures slightly beat estimates, indicating underlying strength. The mixed results may lead to neutral short-term impact.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
JPMorgan Chase reported a 19% rise in net income for 2023, hitting a record profit, with a higher-than-expected interest income forecast for 2024 despite a slight share dip after Q4 earnings.
JPMorgan's record annual profit and positive forecast for 2024 interest income suggest a positive outlook, which could lead to a short-term positive impact on the stock.
CONFIDENCE 80
IMPORTANCE 80
RELEVANCE 80