As of July 20, the second-quarter earnings of major financial institutions in the United States disclosure. From the overall situation, the U.S. financial industry, "winter" is still not in the past, revenue growth, fatigue, the slowdown in investment activities, coupled with external events affect major U.S. financial institutions beleaguered.
In the context of the global economic slowdown, the debt crisis in Europe, not scattered clouds, the second quarter of major U.S. financial institutions continue to suffer the distress of the weak revenue growth.
The second quarter, Citigroup's net revenue of $ 18.64 billion, lower than previous market expectations of $ 19 billion, down 9.6 percent from $ 20.62 billion in the same period last year. Goldman Sachs's second quarter net operating income fell 8.9 percent to $ 6.63 billion, compared with $ 7.28 billion in the same period last year. Bank of America, despite revenue growth, but net interest income of $ 9.782 billion, up sharply down 14.8%.
Lao Erde Blankfein, Goldman Sachs CEO, said in a statement the second quarter, market conditions continued to deteriorate, due to Europe's debt crisis and the global economic slowdown, the commercial activities of the company and customers significantly reduced.
From the specific business sectors closely related to these financial institutions engaged in market revenues affected the most. Such as investment banking division of Goldman Sachs Group revenue fell 17 percent to $ 1.2 billion, decreased by 26% of financial advisory services, securities underwriting fell by 9%. Bank of America Global market sector net profit of $ 462 million, down nearly 50 percent. Morgan Stanley declines most significantly, the M & A advisory business revenue is substantially reduced by 51% to $ 263 million, and securities underwriting revenue fell 34 percent to $ 621 million. In addition, the wealth management business and asset management revenues were also varying degrees of decline.
In addition, the second quarter a number of "extraordinary events" the U.S. financial industry even worse. European and American financial sector occurred whale events in London and the UK banking interbank offered rate manipulating events, these two events not only have serious negative impacts, direct and event-related financial institutions, but also throughout the U.S. and European financial industry's reputation was to shake.
May, JP Morgan Chase Bank broke the nickname of its chief investment sector for the London whale traders in the derivatives trading loss of 2 billion U.S. dollars, so that the outside world are worried about the bank's risk management capabilities and the second quarter earnings . The second quarter results, the losses caused by the event further in the second quarter increased to $ 4.4 billion. This incident led directly to the JP Morgan Chase Bank second-quarter earnings up sharply to 9% JP Morgan market capitalization had fallen by nearly $ 40 billion since April 5.
The UK banking sector interbank offered rate manipulation event alerted the entire financial sector. Many major financial institutions in Europe and America involved, the current investigation also further expand the.
The latest news, the New York Federal Reserve have already been aware of this "manipulation", and the current U.S. Treasury Secretary, when he was New York Fed President Timothy Geithner also will accept the congressional question. Fed Chairman Ben Bernanke said that the London interbank interest rate system itself, there is a structural defect. This has led to new understanding and reflection of the industry for the mechanism.
In the global economic slowdown, the European debt crisis and growth performance point of unknown circumstances, "too big to fail" U.S. financial institutions may have to consider to restructure its business, to seek development in a harsh market environment.
The U.S. banking industry will experience a painful transition period, "too big to fail" unsustainable, "fine" or as the best choice for downsizing, lower pay, focusing on the advantages of business, improve efficiency or will become path of development chosen by the large financial institutions.
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