NEW YORK (
Bank of America
second quarter consensus earnings estimates have fallen by 17% over the past three months--a revision that is significantly more negative than has been seen by peers, according to a report published Tuesday by Deutsche Bank.
The report, drawing on data from
, lists Bank of America as one of three Money Center/Universal Banks. As for the other two in that category, Citigroup saw revisions lowered by 4%, while JPMorgan Chase saw a 4% upward revision in analyst estimates, the report states.
Deutsche Bank classifies the nation's fourth largest bank,
, as a Super Regional, along with
Capital One Financial
From that group, the sharpest downward consensus revision was to Fifth Third, where analysts dropped their second quarter projections by 5%. KeyCorp saw the biggest upward revision, as analysts raised estimates on the Cleveland-based institution by 34%. SunTrust and Capital One also saw big upward revisions, at 29% and 24% respectively.
Among the seven banks Deutsche Bank classifies as Regional Banks,
saw an upward revision of 38%, the best in the group, while the biggest disappointment was
where analysts lowered their estimates by 4%.
Bank of America's
as the bank announced more than $1 billion in private label mortgage put back settlements without reducing its $7 billion to $10 billion "worst case" estimate of how much additional capital it may need to set aside to address additional "private label" put back requests. Chuck Noski, the bank's CFO at the time, said ongoing weakness in the housing market had caused the bank to effectively increase estimates of its potential exposure.
Deutsche Bank's report estimates Bank of America faces an additional $13.8 billion in losses from mortgage putbacks--nearly double the amount it estimates for Wells Fargo, JPMorgan, First Horizon, PNC Financial, SunTrust and Citigroup combined. Bank of America has already set aside or paid out $13.971 billion for mortgage backed security repurchases, according to the report.
Deutsche Bank estimates JPMorgan is essentially finished with the putback issue. The bank has either paid out or reserved $9.153 billion to address mortgage repurchase requests, while Deutsche Bank estimates it will need just $209 million to meet future claims.
After Bank of America, Deutsche Bank sees Wells Fargo as needing the most additional capital to meet putback requests. Deutsche Bank estimates Wells Fargo will need another $3.593 billion, with the bank having already set aside $3.665 billion, according to the report.
Written by Dan Freed in New York
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