- Wells Fargo (WFC - Get Report) saw its pre-provision net revenue -- backing out gains on equity investments and gains on debt securities available for sale -- grow 13% year-over-year, to $9.1 billion in the third quarter, according to Thomson Reuters Bank insight. While third-quarter tax-adjusted net interest income declined to $10.10.820 million from $10.714 million a year earlier, noninterest income rose to $10.384 billion from $8.442 billion, and noninterest expense declined by over $1 billion to $12.112 billion. Mortgage banking revenue was up 53% year-over-year to $2.807 billion in the third quarter, while the company reported net gains from trading activities of $529 million, compared to losses of $442 million, a year earlier. Overall earnings performance remained strong, with a third-quarter ROA of 1.45% and a return on equity of 13.38%.
- For JPMorgan Chase (JPM - Get Report), pre-provision net income increased 14% year-over-year to $10.317 billion. The company's tax-adjusted net interest income declined to $11.176 billion in the third quarter from $11.950 billion a year earlier, as the company's net yield narrowed by 23 basis points year-over-year, to 2.43%. But the company's third-quarter noninterest income -- backing our securities gains -- increased to $13.712 billion from $11.339 billion in the third quarter of 2011. JPMorgan's Corporate/Private Equity business line saw profit increasing to $221 million in the third quarter, from a loss of $645 million a year earlier. Meanwhile, Retail Financial Services profit grew 21% year-over-year, to $1.408 billion, amid the wave of mortgage loan refinancing.
- Citigroup (C - Get Report) saw a 22% year-over-year decline in pre-provision net revenue, to $5.887 billion in the third quarter. Third-quarter tax-adjusted net interest income declined to $12.054 billion from $12.252 billion a year earlier, reflecting a decline in earning assets, as part of the company's long-term strategy to right-size its balance sheet. Citi's net interest margin actually expanded, to 2.86% in the third quarter, from 2.83% a year earlier. Noninterest income declined to $6.237 billion in the third quarter from $8.098 million a year earlier. The third-quarter bottom-line results included a pre-tax loss of $4.7 billion from the sale of a 14% interest in the Morgan Stanley Smith Barney joint venture and the write-down on Citi's remaining 35% interest in the joint venture, which will eventually be sold to Morgan Stanley (MS). A major positive for Citigroup an estimated Basel III Tier 1 common equity ratio was strong 8.6% as of Sept. 30, giving investors hope that the company could receive Federal Reserve approval for a significant return of capital during 2013.
- For Bank of America (BAC - Get Report), one-time items brought the company's third-quarter pre-provision net revenue down by 55% year-over-year, to $4.380 billion in the third quarter. Third-quarter results included pretax litigation expenses totaling $1.6 billion, including the settlement of a 2009 class action lawsuit, related to the company's acquisition of Merrill Lynch. Bank of America's net interest income declined to a tax-adjusted $10.167 billion in the third quarter, from $10.739 billion a year earlier. Noninterest income was down 36% year-over-year, to $10.157 billion in the third quarter, in part because the third-quarter 2011 results included a $3.6 billion gain on sales of shares in China Construction Bank, which was partially offset by a loss of $2.2 billion on private equity and other investments, including the CCB stake.
5 Banks Stocks Showing 'Real' Earnings Growth
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