24 C
Port Moresby
February 26, 2021
Business

Brexit to hurt large U.S. banks’ 2016 earnings by 1-6 percent: KBW

Share the News

(Reuters) – Earnings of large U.S. banks would be hit by 1-6 percent this year if Britons vote in favor of leaving the European Union next week, according to brokerage Keefe, Bruyette & Woods (KBW).

Britain’s exit could increase costs and weaken capital market activity, hurting banks such as Goldman Sachs Group Inc <GS.N>, Morgan Stanley <MS.N>, JPMorgan Chase & Co <JPM.N>, Citigroup Inc <C.N> and Bank of America Corp <BAC.N>, KBW analyst Brian Kleinhanzl wrote in a note on Thursday.

Morgan Stanley and Goldman Sachs, with large exposure to the capital markets, are expected to be the worst hit, Kleinhanzl said.

“Banks may have a two-year transition period and they could experience both revenue and expense headwinds during the transition,” he wrote.

For 2017, the impact on these banks’ earnings per share would be 2-9 percent, he said.

U.S. mortgage lender Wells Fargo & Co <WFC.N> is likely to be least impacted by a “yes” vote on June 23, the brokerage said.

However, in the longer term, the impact of Brexit is expected to be “a wash for U.S. universal banks,” Kleinhanzl said.

(Reporting by Ankit Ajmera in Bengaluru; Editing by Kirti Pandey)

Related posts

ADB’s Assistance Programs

EMTV Online

Papua LNG given the green light to proceed

EMTV Online

Siassi, Finschaffen & Kabwum cocoa growers receive 100% freight subsidy

EMTV Online
error: Content is protected !!