Market update: Big banks announce big profits


First-quarter earnings season was in full swing this week, with big banks taking center stage as they reported results that generally exceeded Wall Street’s predictions. Key factors contributing to big banks’ positive earnings were rising interest rates, which permitted those banks to charge more for loans, and the new tax laws that trimmed corporate tax rates from 35% to 21%.

Summary of big banks’ earning reports

One of the major indicators of a company’s profitability is its earnings per share (EPS), which is a measurement of the company’s profits in relation to the number of outstanding shares of common stock.

This week, all four of the big U.S. banks beat analysts’ forecasts (estimate) with the following EPS results (actual):

  • JPMorgan Chase & Co. (NYSE: JPM):
    EPS (Actual/Estimate): $2.37/$2.28
  • Citigroup Inc. (NYSE: C): EPS (Actual/Estimate): $1.68/$1.61
  • Wells Fargo & Co. (NYSE: WFC): EPS (Actual/Estimate): $1.12/$1.07
  • Bank of America Corp. (NYSE: BAC): EPS (Actual/Estimate): 62 cents/59 cents

What does this mean for you?

This news may be good for your MoneyLion Plus investment portfolio, as all four of these banks are in the top 25 holdings of the Vanguard Total Stock Market ETF (out of 3,619 total stocks; as of 4/18/18) in which you invest.

But while these profits may be good for you as an investor, they may come at your expense as a consumer. A large percentage of big banks’ profits come from tens of billions in overdraft and ATM fees every year — and those fees are paid by consumers just like you.

MoneyLion Plus members really can have it all

How can consumers avoid falling prey to unnecessary bank fees? MoneyLion Plus has the answer. As a MoneyLion Plus member, you’re building your savings as an investor and soon you can enjoy VIP banking with no overdraft, ATM, or hidden fees and 0% APR cash advances as part of your membership.

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