US banking heavyweights do better than expected | Business| Economy and finance news from a German perspective | DW | 14.10.2016
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US banking heavyweights do better than expected

Three of the biggest lenders in the US have presented their third-quarter results - and they are better than analysts had expected. The positive news came as one of the banks faced huge fines for opening sham accounts.

At Wells Fargo, where CEO John Stumpf resigned Wednesday over the bank having created millions of bogus accounts to boost growth figures, net profit came in at $5.6 billion (5.1 billion euros) in the third quarter. While this was 2.6 percent down from the same period a year earlier, the result was a lot better than expected by analysts.

Wells Fargo reiterated Friday it was planning several steps to restore consumer trust after paying about $190 million in fines over its sham accounts scandal.

The lender's new CEO, Tim Sloan, admitted, though, that winning back trust would require a lot of time and persistent work.

Calm waters

Citigroup reported an 11-percent drop in bottom-line earnings for the third quarter year on year, but its results also beat Wall Street expectations. The New York-based lender logged net income of $3.8 billion, while revenue fell by 5 percent to $17.76 billion.

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Wells Fargo CEO John Stumpf resigns

Market leader JP Morgan was ale to boost its third-quarter operating profit by almost a third as the bank profited form higher interest rates and cost-cutting measures. But net earnings dropped by almost 8 percent to $6.29 billion year on year.

The bank pointed out that results were somewhat distorted, because the lender received a one-off hefty tax return in the same quarter last year.

The country's second-largest lender, Bank of America, is due to present its third-quarter results on October 17.

hg/jd (Reuters, dpa)


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