Company Reports

WFC 2Q20: Wobbly Wells, Runaway Bronco Needs to be Lassoed


Wells Fargo fell apart as it cut its dividend  by 80% and bemoaned its situation once again. The market has run out of patience as this under regulated bank has many credit black holes, poorly managed ALM/risk mgt. Poor economic earnings hurts ability to generate organic capital. Strong Sell on Stock, Sell on bonds/preferred stock, High Risk for both Counterparty and Regulatory exposures.

Citigroup: Strong CCAR, Skating on CV19 Reserve Thin Ice, Esp. LatAm


Citi did well on the 2020 DFAST Stress Test, but 2Q20 results were less uplifting as North America Consumer shows credit, revenue weakness. International Consumer will worsen even though it looks to hold in. Buy on Stock, Sell on debt, but Buy on Perpetual Pfd. Regulatory risk is High and Counterparty Risk Medium-to-High. 

JPM 2Q20: Capital Supreme even with SCB


JPM exhibits balance sheet and economic earnings heft as it lowers its economic outlook, but leaps over regulatory capital minimums. Sell on debt but Buy on Perpetual Preferreds. Strong Buy on Stock. Regulatory Risk Medium, Counterparty Risk Low-to-Medium. 

BAC 1Q20: Blanketed Across America With Reserves


Bank of America is preparing for a long recession and boosted its reserves for CECL and the virus outbreaks. Claims it should perform better than in the past cycles as it raised consumer loan quality. Sell Stock, Sell benchmark Bonds. Raise Counterparty and Regulatory Risk to Medium range. 

WFC 1Q20: Woe is Wells, Esp. CRE/CLO


We provide an in-depth report outlining Wells Fargo's serious exposures to commercial real estate, other at-risk sectors like oil & gas, and CLOs. We first were highly concerned about CLOs last July. Rating agency downgrades will worsen these valuations. Sell on Stock, benchmark Bonds. Regulatory & Counterparty risk rise to High from Low to Medium. 

Citi 1Q20: Reserves Up, Lagged Charge-offs More So


Viola Risk presents a comprehesive review of Citigroup and utilizes economic earnings and systemic capital shortfall analysis to show its higher risk levels vs. the other Big 4 banks.  Sell Stock, be choosy on Buys on Bonds. Regulatory risk High, Counterparty Medium-to-High.

JPM 1Q20: From Cards to COVID: Balance Sheet Strength


JPMorgan was the first big bank to show the higher reserve action impacts from the COVID-19 pandemic. While there are still many questions as to length and severity, JPM has the economic earnings strength, reserves and capital to weather the difficult environment. Sell on Bonds, Buy Stock, Counterparty & Regulatory risk is Low-to-Medium. 

BAC 10K Takes: ALM Drives Margin Protection, Loans/Assets Too


Interest rate risk is the most prominent headwind facing most banks. BAC presents the most details on its derivative strategies to preserve net interest margins. And better organic growth is helping as well. We explore these dynamics from the 10K.

JPM Investor Day: Volume Generation Drives Earnings Sustainability


JPMorgan's Investor Days have been so succesful that they may not have them every year. Wow! We explore the bank's huge volume generation capability that stabilizes and allows growth in earnings. 

RF 10K Takes: Organic Growth Challenged, Swaps Saviors


RF continues to be loan challenged and margin squeezed. Fed rates reversal sends it to the swaps sanitorium to preserve margin sanity. Sustainability of loan growth credit quality is questionable. 

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