Welcome!

Microsoft Cloud Authors: Liz McMillan, Elizabeth White, Mihai Corbuleac, Pat Romanski, David Bermingham

News Feed Item

Bank of America and Citigroup Under Scrutiny: Are Banking Giants on a Conservative Approach to Q4 Earnings?

LONDON, January 23, 2013 /PRNewswire/ --

Earnings season is in full swing and major financial services giants are already out with their numbers. The banking sector is still struggling with the ghosts of its past as major banks are taking steps to hive off their loss making assets and cutting costs. However, the sector is still taking cautious approach as it looks to layoffs and trimming its work force to achieve higher efficiency. StockCall analysts recently posted two technical analysis reports on Bank of America Corp. (NYSE: BAC) and Citigroup Inc. (NYSE: C) which are available upon registration at http://www.stockcall.com/register

While corporations like Goldman Sachs are paring down their investment banking operations, banks like Wells Fargo are reducing their reliance on mortgage business. Bank of America reported its net income for the fourth quarter at $732 million, a sharp fall from the $2 billion it had earned for the fourth quarter last year. However, it managed to increase its full year net income from $1.4 billion to $4.2 billion. Similarly, Citigroup reported higher net income for the quarter, but fell short of market expectations. Its net income for the quarter was reported at $1.2 billion. Our technical analysis on Bank of America can be accessed by signing up today at http://www.StockCall.com/BAC012313.pdf  

Bank of America Cuts Costs

One common feature for both the companies' quarterly results was the legal mess they were/are in. Bank of America had to recognize $2.7 billion in settlement charges they have to pay Fannie Mae for warranties and representation fees, which had deep negative impact on its numbers for the fourth quarter of the year. The banking company is right on its way to cost-cutting. It is looking to slash its costs by $5 billion by the end of this calendar year, as a part of its NEW BAC initiative. While cost-cutting measures will certainly add to its bottom-line, a major chunk of this exercise will come from layoffs, which may not be so good for its employee morale. It is also likely to benefit from the rather stabilized economy as the bank will need to make lower provisions for loan losses.

Bank of America stock grew over 50% last year and going by its Q4 numbers, it can be assumed that it is likely to retain the trend in the current year as well. The bank is in stable financial position as it boasts of better than industry ratios for loan and lease provisions. The bank's gamble on Merrill Lynch is also paying well as its brokerage assets grew to $75.9 billion in 2012.

Citigroup Enters New Era with Mike Corbat

Citigroup's quarterly numbers were highly anticipated as it was the bank's first quarter under the new CEO. Citigroup's erstwhile CEO Vikram Pandit had been lauded for steering the bank through tumultuous times, but it seems like the ex-CEO took a couple of shortcuts for achieving these ends. The new CEO is now entrusted with the task of setting those wrongs right. Mike Corbat, the new captain of the ship, is looking to cut costs and while its cost-cutting targets are not as aggressive as Bank of America, still Citigroup is looking to pare down its costs by $900 million in 2013. While its Q4 numbers disappointed, but it was mainly due to conservative loan loss reserves and repositioning charges. The impact of these strategic changes will be visible in coming quarters only.

Both Citigroup and Bank of America are getting rid of loss making assets. While Bank of America is going conservative with its mortgage business, Citigroup is reducing its Citi Holdings assets. While both these banks are still struggling with their legacy issues, their overall financial robustness is constantly improving. Late last year, Citigroup's CFO also let it slip that the company is looking to return capital to its shareholders. In the short-term, Citi may have to see some tough time as it takes some stringent measures to ensure its long-term viability, but in the medium run, such measures are likely to bring forth positive results.

Footer:

  1. Citigroup Inc. Technical Analysis [ http://www.StockCall.com/CitigroupInc012313.pdf ]

About StockCall.com

StockCall.com is a financial website where investors can have easy, precise and comprehensive research and opinions on stocks making the headlines. Sign up today to talk to our financial analyst at http://www.stockcall.com  

SOURCE StockCall.com

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@ThingsExpo Stories
SoftLayer operates a global cloud infrastructure platform built for Internet scale. With a global footprint of data centers and network points of presence, SoftLayer provides infrastructure as a service to leading-edge customers ranging from Web startups to global enterprises. SoftLayer's modular architecture, full-featured API, and sophisticated automation provide unparalleled performance and control. Its flexible unified platform seamlessly spans physical and virtual devices linked via a world...
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, will provide an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life ...
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York and Silicon Valley. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty ...
SYS-CON Events announced today that Commvault, a global leader in enterprise data protection and information management, has been named “Bronze Sponsor” of SYS-CON's 18th International Cloud Expo, which will take place on June 7–9, 2016, at the Javits Center in New York City, NY, and the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Commvault is a leading provider of data protection and information management...
Companies can harness IoT and predictive analytics to sustain business continuity; predict and manage site performance during emergencies; minimize expensive reactive maintenance; and forecast equipment and maintenance budgets and expenditures. Providing cost-effective, uninterrupted service is challenging, particularly for organizations with geographically dispersed operations.
SYS-CON Events announced today that Tintri Inc., a leading producer of VM-aware storage (VAS) for virtualization and cloud environments, will exhibit at the 18th International CloudExpo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, New York, and the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
In his session at 18th Cloud Expo, Bruce Swann, Senior Product Marketing Manager at Adobe, will discuss how the Adobe Marketing Cloud can help marketers embrace opportunities for personalized, relevant and real-time customer engagement across offline (direct mail, point of sale, call center) and digital (email, website, SMS, mobile apps, social networks, connected objects). Bruce Swann has more than 15 years of experience working with digital marketing disciplines like web analytics, social med...
Designing IoT applications is complex, but deploying them in a scalable fashion is even more complex. A scalable, API first IaaS cloud is a good start, but in order to understand the various components specific to deploying IoT applications, one needs to understand the architecture of these applications and figure out how to scale these components independently. In his session at @ThingsExpo, Nara Rajagopalan is CEO of Accelerite, will discuss the fundamental architecture of IoT applications, ...
18th Cloud Expo, taking place June 7-9, 2016, at the Javits Center in New York City, NY, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy. Meanwhile, 94% of enterprises are using some...
SYS-CON Events announced today that BMC Software has been named "Siver Sponsor" of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2015 at the Javits Center in New York, New York. BMC is a global leader in innovative software solutions that help businesses transform into digital enterprises for the ultimate competitive advantage. BMC Digital Enterprise Management is a set of innovative IT solutions designed to make digital business fast, seamless, and optimized from mainframe to mo...
As cloud and storage projections continue to rise, the number of organizations moving to the cloud is escalating and it is clear cloud storage is here to stay. However, is it secure? Data is the lifeblood for government entities, countries, cloud service providers and enterprises alike and losing or exposing that data can have disastrous results. There are new concepts for data storage on the horizon that will deliver secure solutions for storing and moving sensitive data around the world. ...
Join us at Cloud Expo | @ThingsExpo 2016 – June 7-9 at the Javits Center in New York City and November 1-3 at the Santa Clara Convention Center in Santa Clara, CA – and deliver your unique message in a way that is striking and unforgettable by taking advantage of SYS-CON's unmatched high-impact, result-driven event / media packages.
SYS-CON Events announced today that EastBanc Technologies will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. EastBanc Technologies has been working at the frontier of technology since 1999. Today, the firm provides full-lifecycle software development delivering flexible technology solutions that seamlessly integrate with existing systems – whether on premise or cloud. EastBanc Technologies partners with p...
SYS-CON Events announced today that ContentMX, the marketing technology and services company with a singular mission to increase engagement and drive more conversations for enterprise, channel and SMB technology marketers, has been named “Sponsor & Exhibitor Lounge Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York City, New York. “CloudExpo is a great opportunity to start a conversation with new prospects, but what happens after the...
The essence of data analysis involves setting up data pipelines that consist of several operations that are chained together – starting from data collection, data quality checks, data integration, data analysis and data visualization (including the setting up of interaction paths in that visualization). In our opinion, the challenges stem from the technology diversity at each stage of the data pipeline as well as the lack of process around the analysis.
The 19th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Containers, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit y...
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 19th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world and ThingsExpo New York Call for Papers is now open.
The IoTs will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform. In his session at @ThingsExpo, Craig Sproule, CEO of Metavine, will demonstrate how to move beyond today's coding paradigm and share the must-have mindsets for removing complexity from the development proc...
SYS-CON Events announced today that Enzu, a leading provider of cloud hosting solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Enzu’s mission is to be the leading provider of enterprise cloud solutions worldwide. Enzu enables online businesses to use its IT infrastructure to their competitive advantage. By offering a suite of proven hosting and management services, Enzu wants companies to foc...
The IoT is changing the way enterprises conduct business. In his session at @ThingsExpo, Eric Hoffman, Vice President at EastBanc Technologies, discuss how businesses can gain an edge over competitors by empowering consumers to take control through IoT. We'll cite examples such as a Washington, D.C.-based sports club that leveraged IoT and the cloud to develop a comprehensive booking system. He'll also highlight how IoT can revitalize and restore outdated business models, making them profitable...