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As consumers and Wall Street investors eye this week’s list of bank earnings for either a gauge on their dollar or direction of market volatility, professionals in the finance sector have concerns up and down the balance sheet.
Ahead of quarterly financial reports Friday from BlackRock, Citigroup, JPMorgan Chase, PNC Financial and Wells Fargo, FOX Business surveyed a group of finance experts for their take on the upcoming earnings releases and what they will be looking for in the data.Ticker Security Last Change Change % BLK BLACKROCK INC. 670.73 +4.76 +0.71%C CITIGROUP INC. 47.30 +0.38 +0.81%JPM JPMORGAN CHASE & CO. 128.99 +0.49 +0.38%PNC THE PNC FINANCIAL SERVICES GROUP INC. 121.41 +1.71 +1.43%WFC WELLS FARGO & CO. 39.66 +0.47 +1.20%
Jeff Buchbinder, chief equity strategist for LPL Financial, said, "Investors may be surprised with how the big banks held up in the first quarter."
"But the problem is the lending and profit environment over the next several quarters, not first quarter results," he added. "The big banks were winners from the bank failures but the profit environment going forward just got a little tougher in an economy that was already slowing."
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Meanwhile, Jamie Cox, managing partner at Harris Financial Group, told FOX Business, "Bank executives will likely be too cautious and oversell the effects of the banking crisis in hopes of staving off or denting regulatory changes that would impact earnings a lot longer than short-term funding issues."
"The worst thing that could happen going into a recession for mid-tier banks would be a major regulatory change affecting their capital at a time when it could be taxed by recessionary factors," he said. While some finance pros might be interested in seeing the banks’ deposit amounts, "the bigger question of bank liquidity was solved by the Fed.
"The longer we go with no major takeovers from the Federal Deposit Insurance Corporation, the fewer depositors will fear holding deposits at a bank," he finished.
REGIONAL BANKS 'REASONABLY STABLE' BUT REGULATORS NEED TO PROVIDE 'MORE CLARITY': FORMER FDIC CHAIRWhat are banks saying?
Kelly Crawford, VP and financial treasurer of Countybank in South Carolina, said, "The outlook for bank earnings is positive with net interest margin continuing to drive profitability."
"We believe net interest margin expansion has reached its peak with rising deposit pricing putting additional pressure on cost of funds," she continued. "While the potential for a recession continues to be at the forefront of everyone’s mind, tighter credit standards will follow, while the overall size of banks on average will be reduced in the first quarter, which should positively impact capital."
Last week, JPMorgan Chase CEO Jamie Dimon warned the turmoil that has engulfed the financial sector in the wake of recent bank collapses is not over and will ripple throughout the economy for many years.
Jamie Dimon, CEO of JPMorgan Chase, is sworn in during the Senate Banking, Housing, and Urban Affairs Committee hearing on Sept. 22, 2022. (Tom Williams/CQ-Roll Call, Inc via Getty Images / Getty Images)
In March, First Citizens Bank began acquiring assets from Silicon Valley Bank (SVB), the Federal Reserve announced another 25-basis-point interest rate increase after SVB and Signature Bank collapsed, erasing billions of market value in financial stocks.
Meanwhile, First Republic Bank struggled to stay in business even after a $30 billion lifeline from other financial institutions.
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Crawford said: "The yield curve rallied in the latter half of the first quarter, which should reduce the unrealized losses on bank balance sheets and securities portfolios."
"This should lead to less stress on liquidity and potential borrowing restrictions that could result if tangible capital ratios fall below specific targets," she added. "Bank earnings should continue to be positive; however, mortgage volume continues to be low due to high mortgage rates, which limits the growth potential for banks in the real estate lending sector."And the academics?
In an interview with FOX Business, Derek Horstmeyer, a professor of finance at the George Mason University School of Business, said, "Some finance pros will look for disclosure in the footnotes." close video Banks are the lifeblood of the economy: Jim Bianco
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"For instance, details on percent of deposits that are over the regulatory threshold and any disclosure on the steadiness of deposits, or facilities they have access to for short term funds," he went on. "For others, commercial real estate performance will have their attention, which has been showing cracks in some parts of the country, so details on its performance could be important."
ESPN baseball reporter. Covered the L.A. Rams for ESPN from 2016 to 2018 and the L.A. Angels for MLB.com from 2012 to 2016.
LOS ANGELES — Aside from his ability to pitch and hit and stretch the boundaries of imagination, Shohei Ohtani has displayed another singular trait in his time in the major leagues: an ability to meet the moment. Or, perhaps, for the moment to meet him.
And so on Wednesday night, with his Los Angeles Dodgers looking to stay unbeaten, the score tied in the bottom of the ninth, and more than 50,000 fans standing and clenching the Ohtani bobbleheads they lined up hours in advance for, Ohtani approached the batter’s box — and his teammates expected greatness.
“He’s going to end this right here,” Dodgers third baseman Max Muncy said he thought to himself.
“We knew,” starting pitcher Blake Snell said. “It’s just what he does.”
Validation came instantly. Ohtani stayed back on a first-pitch changeup from Raisel Iglesias near the outside corner and shot it toward straightaway center field, 399 feet away, for a walk-off home run, sending the Dodgers to a 6-5, come-from-behind victory over the reeling Atlanta Braves.
“I don’t think anybody didn’t expect him to hit a walk-off home run there,” Dodgers utility man Tommy Edman said. “It’s just a question of where he’d hit it.”
The Dodgers are now 8-0, topping the 1933 New York Yankees of Lou Gehrig and Babe Ruth for the longest winning streak to begin a season for a reigning champion. The Braves, meanwhile, are 0-7, the type of record no team has ever recovered from to make the playoffs. And Ohtani, with three home runs and a 1.126 OPS this season, just keeps meeting moments.
“He’s pretty good, huh?” Dodgers outfielder Teoscar Hernandez said. “It’s Shohei. He’s going to do that. He’s going to do things better than that.”
On Aug. 23 last year, Ohtani reached the 40/40 club with a walk-off grand slam. Five days later, the Dodgers staged a second giveaway of his bobblehead — one that saw his now-famous dog, Decoy, handle the ceremonial first pitch — and Ohtani led off with a home run. On Sept. 19, Ohtani clinched his first postseason berth and ascended into the unprecedented 50/50 club with one of the greatest single-game performances in baseball history — six hits, three homers, two steals and 10 RBIs. Barely two weeks later, he homered in his first playoff game.
When Ohtani came up on Wednesday, he had what he described as a simple approach.
“I was looking for a really good pitch to hit,” Ohtani said through an interpreter. “If I didn’t get a good pitch to hit, I was willing to walk.”
Of course, though, he got a good pitch.
And, of course, he sent it out.
“You just feel that he’s going to do something special,” Dodgers manager Dave Roberts said. “And I just like the way he’s not pressing. He’s in the strike zone, and when he does that, there’s just no one better.”
The Dodgers began their much-anticipated season with a couple of breezy wins over the Chicago Cubs from Japan, even though Mookie Betts and Freddie Freeman did not play in them. They returned home, brought iconic rapper Ice Cube out to present the World Series trophy on one afternoon, received their rings on another and swept a three-game series against the Detroit Tigers. Then came the Braves, and the Dodgers swept them, too — even though Freeman, nursing an ankle injury caused from slipping in the shower, didn’t participate.
The Dodgers already have two walk-offs and six comeback wins this season.
Wednesday’s effort left Roberts “a little dumbfounded.”
A nightmarish start defensively, highlighted by two errant throws from Muncy, spoiled Snell’s start and put them behind 5-0 after the first inning and a half. But the Dodgers kept inching closer. They trailed by just two in the eighth and put runners on second and third with two out. Muncy came to bat with his batting average at just .083. He had used the ballyhooed “Torpedo” bat for his first three plate appearances, didn’t like how it altered his swing plane, grabbed his usual bat for a showdown against Iglesias and laced a game-tying double into the right-center-field gap.
An inning later, Ohtani ended it.
“Overall, not just tonight, there is a really good vibe within the team,” Ohtani said after recording his fourth career walk-off hit. “I just think that’s allowing us to come back in these games to win.”
The Dodgers’ 8-0 start has allowed them to stay just ahead of the 7-0 San Diego Padres and the 5-1 San Francisco Giants in the National League West. Tack on the Arizona Diamondbacks (4-2) and the Colorado Rockies (1-4), and this marks the first time in the divisional era that an entire division has combined for at least 25 wins and no more than seven losses, according to ESPN Research. The Dodgers’ and Padres’ starts mark just the fifth season in major league history with multiple teams starting 7-0 or better, and the first time since 2003.
The Dodgers famously overcame a 2-1 series deficit to vanquish the Padres in the NL Division Series last year, then rode that fight to their first full-season championship since 1988.
That fight hasn’t let up.
“It feels like this clubhouse is carrying a little bit of the attitude we had last year that we’re never out of a game and we’re resilient, and we’ve been carrying it into this season,” Muncy said. “It’s been fun to watch. The guys don’t give up. Bad things have happened, and no one’s really been down or out on themselves. Everyone’s just, ‘All right, here we go, next inning, let’s get after it.’ The whole team, top to bottom, has been doing that. It’s been making it really, really fun to play.”
In his first start since agreeing to a $170 million, six-year contract, the left-hander pitched a career-best eight innings as the Red Sox shut out the Baltimore Orioles 3-0 on Wednesday night. Crochet also threw 102 pitches, one shy of his career high.
“My first start in college I went eight, and I haven’t sniffed it since,” Crochet said.
Crochet (1-0) gave up four hits and a walk while striking out eight in his first victory since the offseason trade that sent him from the Chicago White Sox to Boston.
“That’s the reason he’s here,” manager Alex Cora said after the game. “That’s the reason we committed to him.”
Crochet went 6-12 with a 3.58 ERA last season, a bright spot on a Chicago team that lost 121 games. He threw 146 innings, which was double his previous career total since his debut in 2020.
Then Crochet was dealt to the Red Sox, and they made their long-term commitment to the 25-year-old earlier this week.
“Going back to when the trade went through, we knew Boston was a place where we would love to be long term,” Crochet said. “Credit to the front office for staying diligent, and my agency as well.”
Now the question is less about where he’ll pitch and more about how well. He’s off to a nice start in that regard.
“I can’t think of the last time I played baseball for pride. In college, you’re playing to get drafted, and once you’re in the big leagues, you’re playing to stay in the big leagues,” Crochet said. “So to have this security and feel like I’m playing to truly just win ballgames, it takes a lot of the riff-raff out of it.”
The news all around was good for Boston on Wednesday.
It reached a $60 million, eight-year deal with young infielder Kristian Campbell, and he went out and doubled twice against the Orioles.
And Rafael Devers ended a 21-at-bat hitless streak to start the season with an RBI double in the fifth inning. He finished with two hits and no strikeouts.
Information from The Associated Press was used in this report.
SAN JOSE, Costa Rica — Carbon monoxide poisoning was the cause of death of the teenage son of former New York Yankees outfielder Brett Gardner, authorities in Costa Rica said Wednesday night.
Randall Zúñiga, director of the Judicial Investigation Agency, said 14-year-old Miller Gardner was tested for carboxyhemoglobin, a compound generated when carbon monoxide binds to hemoglobin in the blood.
When carboxyhemoglobin saturation exceeds 50%, it is considered lethal. In Gardner’s case, the test showed a saturation of 64%.
“It’s important to note that adjacent to this room is a dedicated machine room, where it’s believed there may be some type of contamination toward these rooms,” Zúñiga said.
The head of the Costa Rican judicial police added that, during the autopsy, a “layer” was detected on the boy’s organs, which forms when there is a high presence of the poisonous gas.
Gardner died March 21 while staying with his family at a hotel on the Manuel Antonio beach in Costa Rica’s Central Pacific.
Asphyxiation was initially thought to have caused his death. After an autopsy was performed by the Forensic Pathology Section, that theory was ruled out.
Another line of investigation centered around whether the family had suffered food poisoning. Family members had reported feeling ill after dining at a nearby restaurant on the night of March 20 and received treatment from the hotel doctor.
Brett Gardner, 41, was drafted by the Yankees in 2005 and spent his entire major league career with the organization. The speedy outfielder batted .256 with 139 homers, 578 RBIs, 274 steals and 73 triples in 14 seasons from 2008 to 2021.