US Banking Sector Sees Fourth Consecutive Day Of Losses After Q4 Earnings Release

Benzinga - by Piero Cingari, Benzinga Staff Writer.

The U.S. banking sector’s earnings season started on a weak note. The market shows a negative reaction to the results reported on Friday by JPMorgan Chase & Co. (NYSE:JPM), Bank of America Corp. (NYSE:BAC), Citigroup Inc. (NYSE:C), Wells Fargo Company (NYSE:WFC), and Bank of New York Mellon Corp. (NYSE:BK).

A basket of the 24 largest U.S. banking stocks — as monitored by the Invesco KBW Bank ETF (NYSE:KBWB) — declined by 1.4% at midday trading in New York.

This marks its fourth consecutive day of negative closing — the worst streak since early November 2023.

The broader U.S. financial sector, as tracked by the Financial Select Sector SPDR Fund (NYSE:XLF), also saw a decrease of 0.3%.

Wells Fargo & Company, Western Alliance Bancorporation (NYSE:WAL), Zions Bancorporation (NASDAQ:ZIONS), and Citizens Financial Group, Inc. (NYSE:CFG) were among the worst performers in the banking sector for the day, each experiencing declines of more than 3%.

How Did US Banking Report In Q4 2023?/h2

Name Adj. EPS Estimated EPS Surprise % EPS Revenue ($bn) Estimated Revenue

($bn) Surprise % Revenue

Citigroup	0.84	0.81	3.7%	17.440	18.741	-6.94%
Bank of America	0.70	0.68	2.9%	23.500	39.778	-1.03%
JPMorgan Chase	3.97	3.32	19.6%	39.943	39.943	0.42%
Wells Fargo	0.86	1.17	-26.5%	20.478	20.300	0.88%
Bank of New York Mellon	1.28	1.13	13.3%	4.461	4.294	3.9%

Citigroup reported adjusted earnings per share (EPS) of $0.84, surpassing estimated EPS by 3.7%. However, the bank’s revenue fell short of expectations, with a negative surprise of -6.94%. See: Citigroup Navigates Tough Quarter with Revenue Dip, Plans Major Job Cuts

Bank of America exceeded expectations with an adjusted EPS of $0.70, beating estimated EPS by 2.9%. Nevertheless, the bank missed revenue estimates by -1.03%, reporting revenue of $23.50 billion. See: Bank of America’s Q4 Revenue Dips 10%; CFO Highlights Organic Growth, 4.6M Credit Card Accounts Addition

JPMorgan Chase reported a significant positive surprise in adjusted EPS, with $3.97 compared to an estimated $3.32, representing a 19.6% surprise. Their revenue broadly matched expectations, with no significant deviation. See: JPMorgan Q4 Earnings Shine, Sees Strong FY24 NII But Warns Of Potential Risks

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Wells Fargo reported adjusted EPS of $0.86, falling significantly short of the estimated EPS of $1.17, resulting in a -26.5% surprise. However, the bank’s revenue slightly exceeded expectations, with a positive surprise of 0.88%.

Bank of New York Mellon outperformed both in terms of adjusted EPS, beating expectations by 13.3%, and revenue, surpassing estimates with a positive surprise of 3.9%. Their adjusted EPS was $1.28, while revenue reached $4.461 billion.

Now Read: Wells Fargo’s 2023 Profit Rises 9% Buoyed By Higher Interest Rates, But Warns Lower Net Interest Income For 2024

Image: Shutterstock

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