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BAC

Bank of America

$28.78

0.1 (0.35%)

, GS

Goldman Sachs

$227.17

1.87 (0.83%)

14:46
07/12/18
07/12
14:46
07/12/18
14:46

On The Fly: What to watch in next round of big banks' earnings reports

Bank of America (BAC), Goldman Sachs (GS), and Morgan Stanley (MS) are scheduled to report quarterly results on July 16, 17, and 18, respectively. What to watch for: 1. DIVIDENDS, REPURCHASES: On June 28, Morgan Stanley announced its 2018 Capital Plan, which includes the repurchase of up to $4.7B of outstanding common stock for the four quarters beginning in the third quarter of 2018 through the end of the second quarter of 2019, and an increase in the bank's quarterly common stock dividend to 30c per share from the current 25c per share, beginning with the common dividend expected to be declared for the third quarter of 2018. Goldman Sachs also announced that its capital plan will provide for up to $5.0B in repurchases of outstanding common stock and $1.3B in total common stock dividends, including an increase in the bank's common stock dividend of 5c from 80c to 85c per share in the second quarter of 2019. Meanwhile, Bank of America announced that the Federal Reserve also did not object to the company's capital plan, which is estimated to return approximately $26B to common stockholders over the next four quarters through a quarterly common stock dividend increase and common stock repurchases. As part of the capital plan, the bank's board of directors plans to increase its quarterly common stock dividend by 25% to 15c per share, beginning in the third quarter of 2018. Also, the company has been authorized to repurchase approximately $20.6B in common stock from July 1, 2018 through June 30, 2019, which includes approximately $600M in repurchases to offset shares awarded under equity-based compensation plans during the same period. 2. CEO TRANSITION: On May 18, The New York Times reported that Goldman Sachs president David Solomon will likely be appointed CEO by the end of this year, and he is already structuring his senior management team. The time frame for Solomon's rise has evolved since he was named president of the bank in March, establishing him as the heir apparent to longtime CEO Lloyd Blankfein, the report said. Blankfein's departure will likely take place in conjunction with the bank's annual dinner for retired partners in December, the publication added. 3. IHS MARKIT: Ipreo, a financial services solutions and data provider, announced on May 21 the signing of a definitive agreement to be acquired by IHS Markit (INFO). IHS Markit is acquiring the business from private equity funds managed by Blackstone (BX) and by the Goldman Sachs Merchant Banking Division, for $1.855B. Since Blackstone and Goldman Sachs' investment in 2014, Ipreo has grown its revenues by nearly 60%. The acquisition is expected to close in the second half of 2018, subject to customary closing conditions and regulatory filings and approvals. 4. BREXIT: Bank of America plans to relocate up to 125 positions from the U.K. mostly to Ireland as it prepares for Brexit, Reuters reported back in May, citing a corporate filing. The lender said that employees in finance, risk, compliance, technology and credit functions would be impacted and the moves will take place between July and December of this year, the report added.

BAC

Bank of America

$28.78

0.1 (0.35%)

GS

Goldman Sachs

$227.17

1.87 (0.83%)

MS

Morgan Stanley

$48.10

0.37 (0.78%)

INFO

IHS Markit

$52.82

0.01 (0.02%)

BX

Blackstone

$35.07

0.44 (1.27%)

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