Advanced Theory & Practice of Bonds

IBF Recognized Under FTS
1-2 December 2021

Two-day immersive course on bonds designed for private bankers and advisors. 90% funding* available to eligible company-sponsored candidates.

JPMorgan Chase (JPMC), Wells Fargo and Citigroup reported earnings on Friday as the Q4 earnings season began last week. Below are highlights from their earnings:

JPMC reported an EPS of $3.79 with net income up 42% to $12.1bn as it released $2.9bn in credit loss reserves. While net interest income fell 7% to $13.4bn, overall trading revenues jumped 20% – a 15% rise in fixed income and a 32% rise in equity trading. They ended the year with a CET1 ratio of 13.1% vs 12.4% at year-beginning and capital above $200bn. They also noted they hold $1.4tn of cash and marketable securities, which is currently over $450bn in excess of what is required.

Wells Fargo reported an EPS of $0.64 with net income up 4% to $2.99bn. Net interest income fell 17% to $9.3bn, and trading revenues fell 13% due to lower credit adjustment revenue driven by wider credit spreads and lower equities revenue. Provision for credit losses increased $109mn driven by higher losses in the commercial real estate portfolio. They ended the year with a CET1 ratio of 11.6% vs 11.1% at year-beginning and noted that the board approved an increase in the Company’s authority to repurchase stock by an additional 500mn shares.

Citi reported an EPS of $2.08 with net income down 7% to $4.6bn, reporting lower revenues, increase in expenses, and a higher effective tax rate. They released $1.5bn in reserves for credit losses, bigger than analysts had expected. Trading revenues rose 11% led by the equities business up 57% while fixed income revenues were up 7%. They ended the year with a CET1 ratio of 11.8% unchanged from year-beginning.

JPMC’s 4.6% Perps were down 0.25 to 103.5, Wells’ 5.9% Perps were down 0.3 to 107.04 and Citi’s 6.25% Perps were up 0.5 to 115

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