Fitch is out with their quarterly banking report and TPC readers will be shocked at their findings: the Q1 bank earnings are unsustainable going forward. Fitch says:
Credit losses at major banks continue to rise while strength from market-dependent revenues such as mortgage origination and fixed income trading are not likely to persist. Furthermore, net interest margins have become increasingly constrained by rising levels of non-performing assets and a lack of willingness and ability to fully pass lower market rates to core deposits.
Fitch expects that banks will exhibit continued increases in loan delinquencies, non-performing assets and, in many cases, net-charge offs for at least several quarters as the economic outlook remains uncertain
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.