Analysts and investors gained insight into what may lie ahead in the recent round of first-quarter
Credit card giant Discover Financial Services laid the groundwork for
Credit card losses coupled with bad office loans played a key element in
Read more:
Morgan Stanley was another firm to demonstrate positivity in the face of business challenges after a first quarter that saw a record $6.9 billion in net revenue in wealth management, despite
In response to an analyst's question about whether the investigations would alter the business strategy around wealth management, CFO Sharon Yeshaya said they wouldn't. "This is a phenomenal business … and we're in a great position," she said. "There are no changes in our ability to do business, and we're extremely confident in our ability to grow and to deepen the relationship with the breadth of firm offerings that we have to serve our clients."
At
During a call with reporters in April, CFO Jeremy Barnum broke down
Read more:
At the same time, "we've got a mix of businesses that I think we've demonstrated resiliency around … and we expect for those to continue to drive some top-line momentum," Mason said. "But we've got levers in case they don't."
Catch up on these stories in our roundup of first-quarter earnings report news.
![What investors can take away from Q1 bank earnings reports (1) What investors can take away from Q1 bank earnings reports (1)](https://i0.wp.com/arizent.brightspotcdn.com/dims4/default/508ded7/2147483647/strip/true/crop/5011x3341+0+0/resize/740x493!/quality/90/?url=https%3A%2F%2Fsource-media-brightspot.s3.us-east-1.amazonaws.com%2F4b%2Fb5%2Fddb229c842c99af78742da954c96%2Fadobestock-496550718-editorial-use-only.jpeg)
JHVEPhoto - stock.adobe.com
'Solid' results buoy Discover, despite millions assigned to overcharge liability
Michael Shepherd, interim CEO of Discover, told analysts during the firm's April earnings call that results were "solid" for the first quarter due to expanding receivables and improving credit quality. The firm, however, had to subtract $799 million from Q1 profits to cover costs to fix a miscategorization error from years ago that led to
The credit card giant initially indicated when it revealed the missteps in July of 2023 that its liability for funds owed to merchants and acquirers would be
Due to the funds set aside for the merchant issue, Discover's net income for the quarter ended Jan. 31, 2024, was $309 million, down 68% from the same period a year earlier, said John Greene, Discover's chief financial officer. Revenue was $4.2 billion, beating analysts' expectations.
Read more:
![What investors can take away from Q1 bank earnings reports (2) What investors can take away from Q1 bank earnings reports (2)](https://i0.wp.com/arizent.brightspotcdn.com/dims4/default/f16fa4e/2147483647/strip/true/crop/5000x3332+0+0/resize/740x493!/quality/90/?url=https%3A%2F%2Fsource-media-brightspot.s3.us-east-1.amazonaws.com%2F5a%2F0f%2F433f515b440aafed352589b67809%2F405904036.jpg)
Angus Mordant/Bloomberg
Credit card and office loan losses fail to dampen enthusiasm at Bank of America
"All of this is still well within our risk appetite and our expectations, and it's consistent with the normalization of credit we've discussed with you in prior calls," Chief Financial Officer Alastair Borthwick told analysts during the bank's quarterly earnings call in April.
The firm pulled in net income of $6.8 billion last quarter, down from $8.2 billion in the first quarter of 2023, dampened in part by the credit-loss provision and a special assessment from the Federal Deposit Insurance Corp. related to bank failures last spring.
Read more:
![What investors can take away from Q1 bank earnings reports (3) What investors can take away from Q1 bank earnings reports (3)](https://i0.wp.com/arizent.brightspotcdn.com/dims4/default/b9d1b5d/2147483647/strip/true/crop/3400x2268+0+0/resize/740x494!/quality/90/?url=https%3A%2F%2Fsource-media-brightspot.s3.us-east-1.amazonaws.com%2Fa3%2F30%2F578973d5449ab805f30a7d47f8a8%2F403535904.jpg)
Jeenah Moon/Bloomberg
Full steam ahead for Morgan Stanley despite regulatory scrutiny
Morgan Stanley
However, Pick played down a Wall Street Journal report on
"This is not a new matter," Pick told analysts. "We've been focused on our client onboarding and monitoring processes for a good while."
Wealth management has been critical to Morgan Stanley's business model since the 2008 financial crisis. Last year, the unit reported net revenues of $26.3 billion, nearly half of the firm's total net revenues of $54.1 billion.
Read more:
![What investors can take away from Q1 bank earnings reports (4) What investors can take away from Q1 bank earnings reports (4)](https://i0.wp.com/arizent.brightspotcdn.com/dims4/default/e55acf8/2147483647/strip/true/crop/4000x2668+0+0/resize/740x494!/quality/90/?url=https%3A%2F%2Fsource-media-brightspot.s3.us-east-1.amazonaws.com%2Fa4%2F2f%2F8ced7ea14713a5f101ad35a87f55%2F408969646.jpg)
'Green shoots' emerge for investment banking at JPMorgan Chase and Wells Fargo
The beginnings of a recovery in investment banking are on the way for
JPMorgan Chase raked in $2 billion of investment banking revenue during the first quarter, up 27% year-over-year, as it took advantage of fees from equity and debt market activity. "We were happy to see the good results in investment banking this quarter, quite strong," Chief Financial Officer Jeremy Barnum said in April during a call with reporters.
Meanwhile,
"Our results benefited from the areas where we have had strength for some time such as investment-grade debt capital markets and from the talent we've been attracting into the business," Santomassimo said. "While it is still early, we are encouraged by the green shoots we're seeing."
Read more:
![What investors can take away from Q1 bank earnings reports (5) What investors can take away from Q1 bank earnings reports (5)](https://i0.wp.com/arizent.brightspotcdn.com/dims4/default/991e8be/2147483647/strip/true/crop/4000x2670+0+0/resize/740x494!/quality/90/?url=https%3A%2F%2Fsource-media-brightspot.s3.us-east-1.amazonaws.com%2F3c%2F71%2F3febdf6d4f2d8dd99f90267406fc%2F315491568-1-3.jpg)
Christopher Dilts/Bloomberg
Citi may get a boost from an early downturn in expenses
But whether the $2.4 trillion-asset company will be able to simultaneously boost revenues remains to be seen, in part because of the underperformance of its wealth management unit. On a call following the release of
In short, the answer is yes, Mason said. If there's "softness in revenues,"
Read more:
Stewart Bowling
Editor, Growth Content, Arizent