Receiving Wide Coverage ...
Citigroup Earnings: Citigroup became a bit of a megabank outlier this morning when its fourth quarter earnings "failed to live up to Wall Street's expectations." The bank reported that net income more than doubled to $2.69 billion from $1.2 billion this quarter last year, but missed analyst estimates ("by about 9%," according to the Journal). The miss was attributed to a slump in mortgage banking and fixed-income trading. Wells Fargo and JPMorgan Chase both bested analyst expectations earlier this week.
Goldman Earnings: The inverse of Citi, Goldman Sachs' profits slid year-over-year, but easily bested analyst expectations, which were conservative following a lackluster third-quarter. Wall Street Journal, Financial Times, New York Times
More Earnings: BB&T; PNC Financial; Huntington
Treasury Sells Stake in Ally Financial: The U.S. Treasury Department is selling about $3 billion worth of shares in Ally Financial. The sale will bring the government's stake in Ally, purchased during the financial crisis, to about 37% of Ally's common stock. New York Times, Wall Street Journal
U.S. Risk Police: The Office of the Comptroller of the Currency is proposing tougher rules regarding risk management at banks with more than $50 billion in assets. Per the FT, the rules would allow the OCC "to act more quickly on enforcement actions without going through a judge." It could also "impose fines, suspend directors and executives or remove them."
Wall Street Journal
An analysis by the paper found that banks marketing to the U.S. military are among the top 10 U.S. banks in terms of collecting fees. Per the story: "Fort Hood National Bank lets soldiers overdraw their accounts by hundreds of dollars at its seven branches on the Fort Hood U.S. Army base in Texas. It charges them up to $35 for each overdraft."
U.S. regulatory officials are on a "'fact-finding' tour" of Citigroup's London offices regarding its foreign exchange trading practices. The article also cites that Deutsche Bank is facing increased pressure over forex.
Financial Times
Columnist Philips Stevens on the effects of reform (and enforcement) in the banking industry: "Bankers are still collecting multimillion-dollar bonuses even as they shrug off multibillion-dollar fines."
New York Times
Columnist Simon Johnson highlights the influence that Occupy the SEC, an offshoot of the Occupy Wall Street movement, had over the writing on the final Volcker Rule. "Whether the Volcker Rule will actually work remains to be seen," Johnson concludes. "A lot depends on how it will be put in effect by regulators. But the fact that Occupy the S.E.C. is watching carefully from the outside should give us greater confidence that at least this element of financial reform will prove helpful."
