JPMorgan, Bank of America and Citigroup earnings to test deposit stability under 4.8 percent Treasury yields
Bank earnings will quantify the first-quarterly effects of yields above 4.8 percent on deposit stability and net interest margins. Data already show outflows and margin compression; results will test whether capital buffers absorb the pressure or whether further liquidity migration occurs.
Next data points arrive with the Federal Reserve’s Senior Loan Officer Opinion Survey on 23 October and the quarterly bank call reports due in early November. Any material widening of credit spreads or renewed deposit flight would force a reassessment of the Fed’s higher-for-longer path. The incentive structure remains unchanged: banks will report resilient headline earnings while the underlying shift of liquidity out of the banking system continues.
JPMorgan: reported net interest income growth will fall below 5 percent year-over-year, triggering a 3 percent or greater intraday decline in its share price within 48 hours of the release.
Sources (2)
- [1]Federal Reserve H.8 Assets and Liabilities of Commercial Banks(https://www.federalreserve.gov/releases/h8/)
- [2]FDIC Quarterly Banking Profile Q2 2023(https://www.fdic.gov/analysis/quarterly-banking-profile/)