2023-04-22 06:38:22
The major US banks were able to weather the storm that shook the banking sector violently last March, as the quarterly results showed unexpected profits despite the rise in interest rates, which improves the banks’ credit margins.
The newspaper “Le Figaro” (Le FigaroFrench) reported a report in which it stated that Goldman Sachs – which has a strong presence in investment banking services – alone bore the brunt of the crisis in the merger and acquisition market and the volatility of financial markets, between January and March, as its net profit decreased by 19% to $3.1 billion.
The report showed that companies and other giant banks on Wall Street were able to benefit greatly from the banking crisis and the bankruptcy of Silicon Valley Bank, Signature Bank and Silvergate Bank.
Last March, JPMorgan, Citigroup, Wells Fargo and Bank of America acquired new clients who were affected by the bankruptcy crisis of the aforementioned banks and withdrew their money from regional or small banks that It became dangerous in their eyes.
In just a few weeks, Americans withdrew $800 billion from small financial institutions into accounts deemed safer, a move of this magnitude not seen since the 2008 financial crisis, the report said.
He considered JPMorgan to be one of the big winners from this crisis. In March, his deposits swelled by $40 billion. In the first quarter, its net profit jumped 52% to $12.6 billion.
The report quoted Mike Mayo, an analyst at Wells Fargo, as saying, “Wells Fargo, Citigroup, and Bank of America have performed well during the crisis. Bank of America and Wells Fargo can continue to gain long-term market share in the United States,” despite the fact that the deposits of these three giant companies They decreased by 1-3% during the first quarter, which is considered disproportionate to the withdrawals observed in small institutions.
The opinion of Jerome Legras, head of research at Axiom for artificial intelligence, stated that major banks such as “JP Morgan” do not seem to be under pressure to increase deposit compensation, as these giant companies enjoy a dominant position in the US banking market, imposing High prices and almost no room for foreign competitors.
The report concluded by saying that the Wall Street giants remain in a state of readiness, as everyone continues to build provisions to deal with possible credit defaults, as some institutions have already warned that they may provide fewer loans to individuals and companies.
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