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Jacob: 00:02 Banks report earnings this week. Three things to know. One Citigroup just reported earnings, they beat on revenue and earnings. The whole banking group is up. Good news if you're a bank investor, but looking forward, you want to look at, for all these banks, net interest margins as yields have fallen. So that's a big metric that you want to look at for the future with these big banks. Another thing you want to look at, part of this, number two here, it's the would net interest margins. Diversification. JP Morgan is usually pretty good at diversifying. They have many, many different business segments they report this week. So see how well they're able to do that. The third thing, Bank of America reports earnings this week as well. Cost cutting initiative there like at Citigroup. So that's something you want to be mindful of how successful they were able to do that at Bank fo America.

The big banks are kicking off earnings season, and while Citi (C - Get Report) did so with a bang there are some particular factors to watch for in the rest of the earnings reports. 


Citi beat analyst's estimates on revenue and earnings per share, posting $18.8 billion and $1.95 respectively. This beat expectations of $18.5 billion and $1.80. This brought the rest of the banking group up slightly in premarket trading Monday, with the SPDR S&P bank ETF (KRE - Get Report) up 0.11%. 

Net Interest Margin

As interest rates on treasury bonds have fallen in 2019, net interest margins -- the interest on loans that a bank earnings earns over the interest it pays to lenders and depositors -- could fall. In time, falling rates may bring higher loan volumes, but the immediate impact is a contraction in the margin. 

Perhaps of equal importance is for investors to look for banks with a highly diversified business. JPMorgan (JPM - Get Report) reports earnings before the market opens Tuesday, July 16. JPM is especially known for being well diversified, allowing it to grow even when its core business of lending is suffering. 

Bank of America

Bank of America (BAC - Get Report) reports earnings Wednesday, July 17, before the market opens. The bank is looking to cut costs like Citigroup, and investors should watch the earnings to see if Bank of America was able to execute on the full extent of the cost cutting program. 

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