Financial stocks are swinging after earnings, but they’re not all swinging in the same direction.
Bank of America (BAC) beat analysts’ earnings expectations, largely on reduced expenses and lower loan-loss provisions. Revenue slipped on a quarter-over-quarter basis, although it was much higher than a particularly ugly quarter a year ago. Expenses (excluding interest) fell to $17 billion from $19.1 billion in the first quarter as the bank cut thousands of jobs. Investors are giving the bank less credit for its improving balance sheet and expense control than they did earlier in the year. Shares fell 2.2% in morning trading.
US Bancorp (USB) rose 0.5% after posting 74 cents of EPS, 4 cents ahead of expectations. Loans grew 8% over the previous quarter on an annualized basis, with commercial and industrial loans jumping 20%. Shares rose 0.4%.
Bank of New York Mellon (BK) saw earnings fall because of a charge related to a settlement with investors, but core EPS met analysts’ expectations for 53 cents. On a conference call, CEO Gerald Hassell said Europe “is still an absolute mess.” The bank is considering charging clients for their euro deposits. Shares rose 1.5%.
Blackrock’s (BLK) earnings fell 11% on falling fee income as global markets have struggled. Assets under management fell 3%, even as investors added $6.1 billion into Blackrock’s iShares funds. CEO Laurence Fink said the company needs to improve its market share of ETF inflows. Shares fell 0.4%.
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