Wells Fargo Profit Rises 10%, JPMorgan Drops 7.3%

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Jan.14 (Bloomberg) –- Bloomberg's Laura Marcinek and Keri Geiger report on earnings for JPMorgan and Wells Fargo and what the numbers mean for investors. They speak to Mark Crumpton on Bloomberg Television's "Taking Stock." (Source: Bloomberg)

What happened in the quarter and what might this mean from an investor perspective?

We saw a couple of things happen.

We will talk about litigation perspective, but revenue fell at both jpmorgan and wells fargo.

Going into 2014, what investors are going to want to see is revenue growth.

That might not happen until short-term rates go up, which might not happen until 2015. they want to see loan growth.

They want to see mortgage fees going back up.

That was a big reason why revenue fell in the quarter.

It is not just cost cuts.

They want to see revenue.

As you mentioned, kerry is going to talk about litigation.

How is this going to impact earnings?

Jpmorgan took about a $1 billion loss related to litigation.

850 million of that was just due to the made off -- the bernie made off settlement.

That is taking a significant share out of the profits of the banks.

We are going to see this happening in other banks, too.

$23 billion in legal costs.


That is a big one, right?

Is that something you can even anticipate?

You can to a sense, but i don't think anybody really anticipated that jpmorgan would have to pay $13 billion to solve mortgage probes.

That is a tremendous amount of money in more than half of their legal reserve.

When are we going to start to see banking revenues rise again?

That is a great question.

Short-term revenues are a big part of that.

And of course, we have economists who do not forecast that happening until 2015. it could be touch and go from here on out for the next year or so.

Before we go, i have to ask you about the timeline.

I think a lot of banks are highly motivated to get these legal cases, investigations and probes.

They have really piled up over the last year and they want to get them cleared out as soon as possible.

Fingers crossed we see them cleared out and 2014 and then move on to better earnings.

Kerry geithner and laura mars neck, ladies, thanks so much.

Staying with banks, bank of new

This text has been automatically generated. It may not be 100% accurate.


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