Banks back to winning ways
MORGAN Stanley and Credit Suisse will continue the resurgence of fortunes among the world’s biggest banks this week, when they report second quarter results expected to show a gradual recovery.
Wall Street giant Morgan Stanley, which reports on Wednesday, is forecast to show a slight improvement from the first quarter, cutting losses from $0.57 (£0.35) per share to around $0.46 per share.
Swiss bank Credit Suisse, one of the banks to suffer most from the sub-prime crisis, is also preparing to report a continuing recovery on the back of good performance from its fixed income, foreign exchange and commodities teams.
The bank, which smashed analysts expectations in the first quarter to deliver earnings of Sfr1.60 (£0.91) per share, is predicted to have booked a profit of Sfr1.40 per share in the second quarter.
The results are set to continue a bumper period for the world’s biggest banks, due to increased trading activity in fixed income and foreign exchange.
Goldman Sachs last week reported record quarterly profits of $3.4bn, or $4.93 per share, while Wall Street rival JPMorgan Chase saw earnings hit $2.7bn, or $0.72 per share, a jump of 36 per cent from $2bn in the equivalent quarter of 2008.
Morgan Stanley’s results will bring the curtain down on second quarter reports, with UK banks due to unveil their results next month. Barclays and HSBC will kick off the UK reporting season on 3 August.