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US banks 'to see profits rise in 2012'

4 January 2012

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US banks 'to see profits rise in 2012'
America's largest banks are set to enjoy increased levels of profit throughout 2012, a new study has suggested.

Research published by Bloomberg today (4 January) - which involved questioning 184 economic experts - found that, on average, there is an expectation for the country's six biggest financiers to experience a profit rise of 57 per cent this year.

This represents an upturn on the 32 per cent predicted this time 12 months ago, despite the fact the likes of the Bank of America, Goldman Sachs and JPMorgan Chase saw their earnings per share decline over this period.

Even though pressures such as the ongoing eurozone debt crisis remain prevalent, factors like a growth in investment banking deals will lead banks to heightened earnings, the experts believe.

Chris Kotowski of Oppenheimer & Co observed: "The banks could get some positive operating leverage in 2012 from trading normalizing and expenses normalizing."

This comes after it emerged that Bank of America is set to be the worst performing bank in the Dow Jones Industrial Average for 2011.

By Asim Shah

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