Wall Street bank earnings under pressure after crisis

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Most Wall Street banks are likely to report lower quarterly earnings and face a dour outlook for the rest of the year, with last month's regional banking crisis and a slowing economy expected to hurt profitability.

Trading income, a silver lining in the previous quarters, could suffer from lower equities trading in the first quarter versus a year earlier, partially offset by strength in fixed-income, currencies and commodities , analysts said.

Goldman's earnings per share could fall by a fifth, hurt by investment banking woes, after a bigger-than-expected 69% drop inThe six banks declined to comment on upcoming results and forecasts.As interest rates rise, banks make more money on borrowers' interest payments than they pay out to depositors.

Net interest income for the six biggest U.S. banks are expected to be up about 30% from a year earlier, according to analyst estimates from Refinitiv I/B/E/S."There will still be incremental increases in provisions coming in this year," particularly for commercial real estate and potentially consumer credit cards, said Ana Arsov, head of the North American banking team at rating agency Moody's Investors Service.

The results will give a snapshot of how readily lenders can fund operations and whether they have enough cushion to handle shocks. "The fears over bank capital and liquidity levels are likely to persist for at least the next few months because of the recent stresses," Gennadiy Goldberg, U.S. interest rate strategist at TD Securities, said in an interview.

 

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Who really cares?

Another bail out ?

Manufactured crisis.

And the bigger they are, the harder they fall, Bring it.

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