They can’t make a mistake: the top banks were sick at the end of 2024

Bank of America exceeded expectations in terms of profit and revenue, the financial institution revealed on Thursday from its meaning. However, all of this is hardly a surprise, as several giants of the overseas banking sector published their fourth quarter reports a day earlier, full of positive surprises, as a result of which the American stock market indices turned significantly positive.

Bank of America’s three-month revenue was $25.5 billion, compared with expectations of $25.2 billion. Profit was 6.7 billion dollars, 47 percent higher than a year earlier, it is true that several one-off items worsened the base period.

Revenues increased by 15 percent, thanks to increases in investment banking and asset management fees, as well as commissions realized on higher trading volumes. Net interest income rose by 3 percent to 14.5 billion dollars, the prospects in this regard are particularly good, as the Fed expects only a 25-50 basis point interest rate cut for this year, and that only for the second half of the year, so bank interest margins (loan and deposit difference in interest rates) may remain high.

The figures of Morgan Stanley, which were also reported on Thursday, also spoke volumes: against the forecasts of 15 billion dollars, the financial institution earned 16.2 billion dollars in revenue in 3 months. And the net profit doubled to 3.7 billion dollars, even though they also had one-time loss-making items in 2023.

The American stock market indices took a huge boost on November 8, the day of the presidential election. From there, a month-long rally began, and Morgan Stanley also reaped the benefits of surging investor activity: the commission income of their share trading business increased by 51 percent and amounted to 3.3 billion dollars. It was possible to bring all of this together in two parts: on the one hand, their clients were much more active, and on the other hand, the prime brokerage business serving hedge funds also picked up significantly.

But the wealth management business was also benefited by the fact that US stocks are close to an all-time high: as the client portfolio grew, so did Morgan Stanley’s portfolio management fees.

Wednesday was also a busy day on Wall Street. JPMorgan Chase’s performance also picked up thanks to the apparently excellent economy and the stock market rally. The banking house’s revenues reached nearly 44 billion dollars, and the profit reached 14 billion. This bank also found itself in a perfect market environment, with rising net interest income and commissions for bond, foreign exchange and stock trading.

Also yesterday, Goldman Sachs reported on its October-December performance. Here, too, the numbers improved significantly, for example, the net profit jumped to a level not seen in 3 years, to 4.1 billion dollars.