2019-04-27
American banks’ earnings are boosted by retail business
Markets sparkled, but that’s not where the money was
原文来源：The Economist 2019-4-18
Article
AMERICA’S FINANCIAL markets made a stunning start to 2019. The S&P 500 stockmarket index climbed by 13.1% in the first quarter, its best beginning since 1998. But that was little use to Wall Street banks. Trading revenues depend on volumes, not prices. Quarterly earnings, reported in recent days, have confirmed that they were markedly lower than a year earlier. Never mind. The retail divisions of America’s mightiest banks did well enough to boost profits overall. The giants’ retail heft is likely to keep serving them well.
Start, though, with the grim stuff. Share-trading revenues fell by 24%, year on year, at Citigroup and Goldman Sachs; by 22% at Bank of America (BofA); and by 13% at JPMorgan Chase. (Morgan Stanley, the remaining bulge-bracket Wall Street firm, was due to report earnings after The Economist went to press on April 17th.) New share issues were delayed by a 35-day government shutdown that lasted until late January, holding up approvals at the Securities and Exchange Commission; equity-underwriting revenues tumbled by 20% at Citi, 23% at JPMorgan Chase, 29% at BofA and 34% at Goldman. But debt underwriting was perkier at Citi and JPMorgan Chase, and advisory fees rose across the board.
Yet JPMorgan Chase, America’s biggest bank by assets, still reported a 5.4% rise in net income, to $9.2bn, a record. At BofA, the number two, profits climbed by 5.7% to $7.3bn, also a new high. That was largely due to an increase of 19% in earnings at JPMorgan Chase’s retail bank and a 25% rise at BofA. Despite the regulatory troubles that recently cost its chief executive his job, Wells Fargo (among the smaller fry on Wall Street, but America’s fourth-biggest bank even so) also reported a healthy increase.
Banks were helped by wider interest margins and steady loan growth. Now that the Federal Reserve has stopped raising interest rates, that following wind may fade. But the biggest banks will find that easier to live with than their smaller competitors will. And they are determined to make a combination of scale and computing power tell; they are spending billions on IT. They may be starting to succeed. JPMorgan Chase is opening branches by the dozen; BofA has cut the cost-income ratio at its retail bank from 51% to 45% in the past year. Citi seems farther behind, but is wooing credit-card customers outside the half-dozen cities where it has branches by offering them deposits and loans.
If America’s giants need further consolation, they should look across the Atlantic to Europe, where banks’ reporting season starts on April 24th. Already losing market share to the Americans on both sides of the pond and trailing in profitability, the Europeans’ woes show no sign of abating.
Britain’s Barclays is being pestered by an activist investor, Edward Bramson, who wants it to retreat from investment banking. In March it parted company with Tim Throsby, the head of its investment bank, just two years after he joined. Germany’s Deutsche Bank is in merger talks with its neighbour, Commerzbank, in the increasingly desperate hope of reviving its fortunes. On April 15th two American congressional committees subpoenaed Deutsche and other banks for information on their dealings with President Donald Trump. France’s Société Générale is cutting 1,600 jobs. Switzerland’s UBS has complained of “one of the worst first-quarter environments in recent history”. That wobbly quarter on Wall Street wasn’t so bad, was it?
Notes
made a stunning start to 2019
extremely attractive or impressive 极有魅力的；绝妙的；给人以深刻印象的
that was little use to Wall Street banks.
没啥用
they were markedly lower than a year earlier.
显著低于，别用obviously了
The retail divisions of America’s mightiest banks did well enough to boost profits overall.
零售部门；整体
Start, though, with the grim stuff.
开场白：先从严肃的事情开始说起吧
an increase of 19% in earnings
19%的利润增长
Wells Fargo (among the smaller fry on Wall Street, but America’s fourth-biggest bank even so)
富国银行
BofA has cut the cost-income ratio at its retail bank from 51% to 45% in the past year.
有个大概的印象
If America’s giants need further consolation, they should look across the Atlantic to Europe
需要更多的安慰
Already losing market share to the Americans on both sides of the pond and trailing in profitability
落后于
不仅市场份额争夺中输给了美国银行，无论是在欧洲本土还是美国，而且利润也落后。之前的文章有说，欧洲银行业遭遇了巨大危机，winter is coming
the Europeans’ woes show no sign of abating.
困难；降低
