Monday, January 13, 2014

Revenue Growth: A Challenge for Banks

This is a big earnings reporting week for the Big Banks, starting tomorrow. The folks at Credit Suisse are relatively positive on the big banks, although their overriding comment for the sector is that revenue growth will be very challenging.

Even more ironically, their favorite idea based on earnings exposure to emerging markets and relative valuation is Citigroup. Now remember that former CEO Vikram Pandit was drummed out of his position because his strategy was not engendering a turnaround fast enough.  Never mind that possibly apart from Bank of America, no other global mega-bank had been as badly managed for decades.  It appears from reading the CS analysts their bullish case on Citi is based on developments that really had been the core of Mr. Pandit's presentation from the beginning.

It should be an interesting week for financial stocks.

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