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Stocks slightly higher as bank earnings come in mixed

Stocks slightly higher as bank earnings come in mixed

Stocks ticked up Wednesday morning as a host of major banks released a mixed set of quarterly results.

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Dow component Goldman Sachs (GS) on Wednesday reported third-quarter results that well exceeded consensus estimates, as investment banking and fixed income trading revenue each grew over last year and topped expectations. The trading boost Goldman Sachs and other banks including JPMorgan Chase and Citigroup but it did not extend to Bank of America (BAC), which posted lighter-than-expected trading revenue from stocks and bonds, and a miss on overall revenue compared to estimates. Bank of America also built its credit reserves during the quarter, adding more padding in case of potential customer loan defaults amid the pandemic.

At Wells Fargo (WFC), the company swung back to a quarterly profit in the third quarter after a loss in the second, though income missed expectations and was pressured by low rates, and activity overall remained low as both loans and deposits declined.

Meanwhile, lackluster prospects for more stimulus and concerns over the timeline for developing a COVID-19 vaccine and treatment weighed on investors. Each of the S&P 500, Dow and Nasdaq declined for the first time in five sessions as of Tuesday’s close.

An impasse among U.S. lawmakers in Washington has kept hopes running low that more virus relief aid will come to fruition before the November election. Senate Majority Leader Mitch McConnell said Tuesday he will have the Senate take up relief legislation after the chamber’s return on Monday, with his narrower proposal set to include funds chiefly targeted to the Paycheck Protection Program. House Speaker Nancy Pelosi, however, has rejected slimmed-down stimulus proposals and deemed them inadequate, and even President Donald Trump said on Tuesday on Twitter to “Go big or go home!!!” for more stimulus.

Meanwhile, a pair of front-runners

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Stock futures struggle for direction as bank earnings come in mixed

Stock futures struggle for direction as bank earnings come in mixed

Stock futures traded flat to slightly lower Wednesday morning, as a host of major banks released their quarterly results.

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Goldman Sachs (GS) on Wednesday reported third-quarter results that well exceeded consensus estimates, as investment banking and fixed income trading revenue each grew over last year and topped expectations. The trading boost Goldman Sachs and other banks including JPMorgan Chase and Citigroup but it did not extend to Bank of America (BAC), which posted lighter-than-expected trading revenue from stocks and bonds, and a miss on overall revenue compared to estimates. Bank of America also built its credit reserves during the quarter, adding more padding in case of potential customer loan defaults amid the pandemic.

Meanwhile, lackluster prospects for more stimulus and concerns over the timeline for developing a COVID-19 vaccine and treatment weighed on investors. Each of the S&P 500, Dow and Nasdaq declined for the first time in five sessions as of Tuesday’s close.

An impasse among U.S. lawmakers in Washington has kept hopes running low that more virus relief aid will come to fruition before the November election. Senate Majority Leader Mitch McConnell said Tuesday he will have the Senate take up relief legislation after the chamber’s return on Monday, with his narrower proposal set to include funds chiefly targeted to the Paycheck Protection Program. House Speaker Nancy Pelosi, however, has rejected slimmed-down stimulus proposals and deemed them inadequate, and even President Donald Trump said on Tuesday on Twitter to “Go big or go home!!!” for more stimulus.

Meanwhile, a pair of front-runners in the race to develop a COVID-19 vaccine and treatment announced that their respective trials were put on pause over safety concerns. Eli Lilly (LLY) said Tuesday afternoon that enrollment for its COVID-19 treatment would be temporarily halted, less then a day after Johnson

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Bank of America joins peers in improving economic outlook

Bank of America joins peers in improving economic outlook

A stabilising US economy helped Bank of America report a bounce in third-quarter earnings, as credit costs fell towards pre-pandemic levels.

Net income of $4.9bn, or 51 cents per share, compared with $3.5bn in the second quarter, and $5.8bn in the same period in 2019. Wall Street analysts had expected 49 cents a share.

The key factor in the rebound was a big decline in provision for bad loans, at $1.4bn, down from $5.1bn the quarter before, following a trend set by JPMorgan Chase and Citigroup when they reported results on Tuesday.

Total revenue at the bank, at $20.3bn, was slightly short of what analysts had expected, and reflected continued pressure on margins as a result of falling interest rates. Net interest margin — the difference between the bank’s funding costs and its lending yields — was 1.7 per cent in the quarter, down from 2.4 per cent the year before.

The bank’s capital markets operations showed softer growth than JPMorgan and Citigroup, with fixed-income trading revenues increasing slightly from the year before and equities trading rising by 6 per cent. Investment banking fees were up 15 per cent from the year before.

BofA shares have fallen by 29 per cent year to date, slightly outperforming US banking indices.

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Bank of America Reports Third-Quarter 2020 Financial Results

Bank of America Reports Third-Quarter 2020 Financial Results

Bank of America reported its third-quarter 2020 financial results today. The news release, supplemental filing and investor presentation can be accessed in the following ways:

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20201014005476/en/

Investor Conference Call information:
Chief Executive Officer Brian Moynihan and Chief Financial Officer Paul Donofrio will discuss the financial results in a conference call at 8:30 a.m. ET today. For a listen-only connection to the conference call, dial 1.877.200.4456 (U.S.) or 1.785.424.1732 (international), and the conference ID is 79795.

Please dial in 10 minutes prior to the start of the call. Investors can also listen to a live audio webcast of the conference call and view the presentation slides by visiting the “Events and Presentations” section of the company’s Investor Relations website.

Replay information for Investor Conference Call:
Investors can access replays of the conference call by visiting the Investor Relations website or by calling 1.800.934.4850 (U.S.) or 1.402.220.1178 (international) from noon ET on October 14, through 11:59 p.m. ET on October 23.

Bank of America
Bank of America is one of the world’s leading financial institutions, serving individual consumers, small and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 66 million consumer and small business clients with approximately 4,300 retail financial centers, including approximately 2,900 lending centers, 2,500 financial centers with a Consumer Investment Financial Solutions Advisor and approximately 2,300 business centers; approximately 17,000 ATMs; and award-winning digital banking with approximately 39 million active users, including approximately 31 million mobile users. Bank of America is a global leader in wealth management, corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments,

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JN’s UK bank to address financial inclusion and de-risking issues for Diaspora

JN’s UK bank to address financial inclusion and de-risking issues for Diaspora

The Jamaica National (JN) Group, following the launch of its latest subsidiary company— JN Bank in the United Kingdom (UK), has cited financial inclusion as well as the pursuance of correspondent banking services for Caribbean banks as being atop the list of issues to be addressed for people of the Diaspora.

Chief executive officer (CEO) of the JN Group, Earl Jarrett, in referring to a 2017 UK financial report, said that there were some 1.23 million people in Britain who were underserved or not served by banks.

“Financial inclusion is not just a Caribbean problem. In the UK, there is a working paper on how they are going to improve on financial inclusion. It is estimated that four to five per cent of the working population does not have access to banking services and those are primarily persons who have small businesses; persons who don’t feel welcomed in the mainstream banking environment,” he stated.

The JN UK bank, which was launched on October 8 after some two years in the making, represented an historical move for the company which saw them becoming the first Caribbean-owned bank to be established in the UK. This, after UK regulators had granted a full banking licence to the bank last year.

“It is our hope that through the JN Bank, we will be able to provide banking services to those individuals, whatever their racial background or wherever they are from, so they too can achieve their personal objectives,” Jarrett also said while speaking at the virtual launch event on Thursday last.

 

DIGITAL OPERATIONS

Jarrett also disclosed that the operations of bank will be mainly digital, with a physical branch to be located in Brixton, south London which can be used for community activities after banking hours.

“Digitalisation is a true enabler of inclusion.

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