Weak trading and Mexico blamed as US banks suffer
Wednesday 18 January 1995
Chase's net income for the quarter fell by 27 per cent compared with the previous year, to $229m. "Total trading revenue was $32m, down $136m from the fourth quarter of 1993, reflecting the overall adverse global market conditions, including the negativeeffects related to the Mexican peso devaluation," the bank said.
Chase, Chemical, Wells Fargo and NationsBank all suffered falls on the US stockmarkets yesterday as brokers digested the bad news. Chemical suffered a $70m hit due to losses sustained from unauthorised foreign exchange transactions involving the Mexican peso, as previously reported.
Overall, Chemical's trading revenues were $45m for the fourth quarter against $255m last time.
Analysts had expected Chase to earn $1.05 to $1.35 a share in the fourth quarter, but Raphael Soifer, analyst at Brown Brothers Harriman, put operating earnings at $0.42 a share.
For 1994 as a whole the American banks did better. Chase reported full-year net income of $1.2bn, up a quarter from 1993.
Thomas Labrecque, chairman, said: "For 1994, Chase reported record earnings, despite the volatitilty in the global trading markets as well as increasing competition in all of our core business activities." He said the last quarter had been "extremely challenging given the difficult trading environment".
This environment was made up of three things, the most significant of which was the overall weakness in global markets during the 1994 fourth quarter.
He said the devaluation of the Mexican peso on 20 December 1994, and the subsequent deterioration in the emerging markets generally, also resulted in a drop in trading revenue. Trading revenue was also hurt by the continued weakness in derivative marketsin general and by the failure of a few counterparties to fully perform on their obligations, he said.
Chemical reported net income for the fourth quarter of $331m, down from $347m last time. This was before a previously announced restructuring charge of $260m. Overall for the year 1994, net income rose 11 per cent to $1.4bn.
Walter Shipley, chairman and chief executive officer of Chemical, said: "Despite a difficult operating environment . . .we believe the series of intitiatives we announced in December will lift the corporation to a new level of performance."
In December Chemical announced a two-year programme designed to produce earnings per share growth of more than 15 per cent in 1995 and 1996, and a return on shareholders' equity of 16 per cent in 1996.
- 1 Three-year-old ultra-Orthodox Jewish children told 'the non-Jews' are 'evil' in worksheet produced by London school
- 2 Moscow voted the world's unfriendliest city
- 3 The excuses your boss is most likely to believe when you call in sick
- 4 I'm pansexual – here are the five biggest misconceptions about my sexuality
- 5 More than 11,000 Icelanders offer to house Syrian refugees to help European crisis
The excuses your boss is most likely to believe when you call in sick
Bono's group has made more money from Facebook investment than from all his music
Three-year-old ultra-Orthodox Jewish children told 'the non-Jews' are 'evil' in worksheet produced by London school
Wikipedia rocked by 'rogue editors' blackmail scam targeting small businesses and celebrities
More than 11,000 Icelanders offer to house Syrian refugees to help European crisis
Climate change: 2015 will be the hottest year on record 'by a mile', experts say
Jeremy Corbyn calls Osama bin Laden's killing a 'tragedy' - but was it taken out of context?
If these extraordinarily powerful images of a dead Syrian child washed up on a beach don’t change Europe’s attitude to refugees, what will?
If you're not already angry about the refugee crisis, here's a history lesson to remind you why you really should be
Senior British politicians tell David Cameron: When dead children are being washed up on beaches, it's time to act
Theresa May says migrants should be banned from entering the UK unless they have jobs lined up
iJobs Money & Business
£14000 - £16000 per annum: Recruitment Genius: This company was established in...
£20000 - £25000 per annum + OTE 40k: SThree: SThree are a global FTSE 250 busi...
£20000 - £25000 per annum + competitive: SThree: SThree are a global FTSE 250 ...
Voluntary and unpaid, reasonable expenses reimbursable: Reach Volunteering: St...