Bank Of America Misses Revenue By $2 Billion As Trading Revenue Collapses; Fires Thousands

Tyler Durden's picture

Following disappointing results from JPM and Wells Fargo yesterday, it was Bank of America's turn to "surprise" investors with its disclosure just how bad its quarter was. And with the bank reporting a 50% collapse in its sales and trading from Q3, down $600 million from a year ago to just $1.7 billion in Q4, it should come as no surprise that the bank just reported Net Income, before the usual spate of amusing addbacks, of $0.25 well below the $0.31 expected. And while one may argue whether ot not BofA's EPS deserve non-GAAP adbacks, it was the Revenue of $18.96 billion, which missed expectations of $21.03 billion by over $2 billion (!) and down $2.7 billion from a year ago, that was truly a showstropper and shows that without the Fed's visible hand manipulating markets every day, banks are a ticking time bomb just waiting to blow.

In BofA's own words: "Bank of America Corporation today reported net income of $3.1 billion, or $0.25 per diluted share, for the fourth quarter of 2014, compared to $3.4 billion, or $0.29 per diluted share in the year-ago period. Revenue, net of interest expense, on an FTE basis(B) was $19.0 billion, compared to $21.7 billion in the fourth quarter of 2013."

And keep in mind that the $4.5 billion in pretax earnings included the usual piggybank accounting gimmick of adding back of $0.7 billion in loan loss reserve releases.

Here is the collapse in Sales and Trading, regardless of whether one observes it with or without DVA/FVA:

But here is the best indicator of what BofA's earnings truly were: its headcount. And after firing over 4K FTEs, or down 2.5% from the prior quarter, dropping the total FTE count to 207.9, one can see which way management is positioned.

The good news is that the criminal enterprise that is BofA only had to pay $393 million in litigation expenses, far below the $2.3 billion a year ago. Then again, putting in context, BofA paid up $16.4 billion and $6.1 billion in 2014 and 2013, respectively, in "cost of doing business as a criminal enterprise."

Finally, while JPM "forgot" to report its Net Interest Margin data, BofA was kind enough to provide it. One look at the chart below, which impact all banks, shows why JPM decided it could just do without this data in Q4.

And there you have it: lowest. NIM. Ever.

Q4 earnings presentation below

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ukspreads's picture

Another domino falls...

The Swiss news was the first and there'll be more to come...

Maybe the FED should fold their hand as well and let the Dollar plunge

ArkansasAngie's picture

Join me in saying ... There will be no bailout this time.


GetZeeGold's picture



John Boehner: On your knees bitch......start begging.

SumTing Wong's picture

I'm REALLY going to need a bigger tub of popcorn. 

Keyser's picture

First JPM misses, then the SNB decouples and now BoA missed BIG... One wonders what is next, GRexit? 

DavidC's picture

One can only hope the Greeks have the balls to do it.


PartysOver's picture

Or will the assume the position (Bent Over)?

BuddyEffed's picture

Maybe a bailout for BofA on their CDS and derivative positions throught the Cromnibus bill might help their bottom line.  The shareholders would just love that!

Ariadne's picture

The local movie house is now serving wine and beer to boost business. Bring your tablet & move in.

Debeachesand Jerseyshores's picture

Home Depot is having a sale on tubs and they have free delivery...

sunnyside's picture

Then bail-ins it will be.  Remember that the Treasury would sooner see you broke and with nothing than allow these guys to fail, and Washington wants you on the dole anyway.


Today is Jan 15.  Didn't feel good sending in that quarterly payment?  I feel so patriotic and shit.

Headbanger's picture

And my heart bleeds for these fucking shit balls!

Van Halen's picture

I bet that of the thousands BOA fired, they didn't fire the people who NEEDED firing.

One World Mafia's picture

They'll do whatever it takes to keep the wars going and get Jeb into office.  Hard to imagine they'd find someone worse than Hillary till Jeb threw his name in.

Charles Nelson Reilly's picture

Since QE's inception it's always been a choice, save the banks or save the dollar. Something is going to give.

The man with pointy horns's picture

The dollar will come first. It hast to come first for the FED.

Drummond's picture

I'm getting into fancy dress for today. 

GetZeeGold's picture



The fancy cufflinks too?

css1971's picture

Banks are leading indicators for the rest of the market BTW. Because of their effect on money creation.

ThisIsBob's picture

Look at the down volume the past few days.  Why its almost as if somebody knew.

JRobby's picture

What wooden nosed fuck does the FED like this season?

Bill of Rights's picture
Yes, the Federal Reserve has enormous power over who is president

WTFUD's picture

Got to make sure that us folks here on Z/H do not set our standards too low by using words like 'carnage ' to describe this full on Ponzi.
Carnage is when Jamie and Lloyd JUMP.

Van Halen's picture

WTF, respectfully, you're wrong.

PROGRESS is when Jamie and Lloyd jump.

j0nx's picture

Markets will be green by EOD. Bank on it bitches.

RushRoolz's picture

Remember the "red phone" direct to the Kremlin, purportedly to avert mutual nuclear destruction? That's been replaced by a phone to the PPT.

rsnoble's picture

And BAC is still above it's 52wk low.  The 'untouchables'.

Recall the mass panic evertime BAC got to the $5.00 level?? lol.

Bill of Rights's picture

Data deluge coming up

• At 8:30 AM ET, the initial weekly unemployment claims report will be released. The consensus is for claims to increase to 295 thousand from 294 thousand.

• Also at 8:30 AM, the Producer Price Index for December from the BLS. The consensus is for a 0.4% decrease in prices, and a 0.1% increase in core PPI.

• Also at 8:30 AM, the NY Fed Empire State Manufacturing Survey for January. The consensus is for a reading of 5.0, up from -3.6 last month (above zero is expansion).

• At 10:00 AM, the Philly Fed manufacturing survey for January. The consensus is for a reading of 18.8, down from 24.3 last month (above zero indicates expansion).


waterwitch's picture

Popcorn here! Get your popcorn!

wmbz's picture

As the shit gets deeper there will be bail outs, bail ins and anything else the un-fed can come up with.

These mother fuckers will take grannies last dime to keep their fraud going.

Jamie will be over at Obozo's house today telling him how it's gonna be. Just like Paulson went and bitch slapped Bush Jr.

FUBAR is not a strong enough term!


RushRoolz's picture

Ayup. There is ZERO interest in doing the right thing, thinking about the future, etc. Turns my stomach to think what my kids' generation is going to have to deal with.


Colonel Walter E Kurtz's picture

Don't worry Rush.'s what's for breakfast, lunch and dinner...soon. It's the only way for bankers/government to try to place blame elsewhere, instead of taking the pain themselves.

firstdivision's picture

Lol at Equity trading revenue barely moved, but FICC collapsed.  Guess all those bonds sitting on the Feds balance sheet, and not being moved has really killed FICC groups, and ETF's killed commodities trading for banks.  I cannot wait for the part where the snake eats its head.

venturen's picture

now we getting some place....let the last large banks die a horrible death and then the economy can heal. Anyone notice when the banks were forced to close the commodities trading units....oil is now based on supply and demand?

MalteseFalcon's picture

"Anyone notice when the banks were forced to close the commodities trading units....oil is now based on supply and demand?"

ZH didn't.

blown income's picture

Who the fuck injected oil with helium

Seasmoke's picture

Fuck You Brian Moynihan. And Ken Lewis too. Shut DOWN this criminal organization. 

Jethro's picture

$2 Billion?  That's less than one fat-finger trade.  Meh....

I'm sure the IRS will cut them a check for their losses.

Ban KKiller's picture

Continuing criminal enterprise....Fuck you AND your attorneys. Who, thank you, are almost all inbred idiots drowning in student debt. 

BofA continues to pay out on illegal foreclosures. You have to file counter CLAIM and become plaintiff, then they fold. You lose the home but get 250k and sign non disclosure.

waterhorse's picture

"According to Barofsky, the Home Affordable Modification Program (HAMP) did not have a goal of keeping struggling families and children in their homes.  It’s real goal, according to U.S. Treasury Secretary Tim Geithner, was to “foam the runway” for the banks.

Barofsky explains as follows in his book:

“For a good chunk of our allotted meeting time, Elizabeth Warren grilled Geithner about HAMP, barraging him with questions about how the program was going to start helping home owners.  In defense of the program, Geithner finally blurted out, ‘We estimate that they can handle ten million foreclosures, over time,’ referring to the banks. ‘This program will help foam the runway for them.’

“A lightbulb went on for me.  Elizabeth had been challenging Geithner on how the program was going to help home owners, and he had responded by citing how it would help the banks. Geithner apparently looked at HAMP as an aid to the banks, keeping the full flush of foreclosures from hitting the financial system all at the same time.  Though they could handle up to ‘10 million foreclosures’ over time, any more than that, or if the foreclosures were too concentrated, and the losses that the banks might suffer on their first and second mortgages could push them into insolvency, requiring yet another round of TARP bailouts.  So HAMP would ‘foam the runway’ by stretching out the foreclosures, giving the banks more time to absorb losses while the other parts of the bailouts juiced bank profits that could then fill the capital holes created by housing losses.”

CoolBeans's picture

So, the other night our mature-beyond-his-years young teen was spiking a fever of 103.8 and we had to layer another med to get it to come down.  He didn't want to take the dose.  I said jokingly, "Well, would you like to swallow it or would you prefer a suppository?"

He said, "Is that like a bank?" 

I replied, "No, that's a depository."

He chuckled and said, "Same difference."

Wise young man.

FreeNewEnergy's picture

Well, I did that and I'm only getting $9K, agreement complete with non-disclosure and non-disparagement.

It's the 11th commandment: Thou shall not disparage scheming, double-dealing, corrosive, fraudulent, insolvent banks.

Of course, my (actually, my dad's, I just inherited it) loan was only $85,000, and dad paiid on it for two years, but, by the time I will have moved out, the bank will have paid over $20K in taxes, and I will have lived here for free for Almost 6 years (5 years, 9 months). I figure I did OK.


Evil Bank: made $87,000 loan on house appraised at $116,000 (totally bogus). Dad paid about 15K over two years, then bank spent $5K on lawyers, $20K on taxes, $9K on settlement (folding like cheap suits that they are). House was last appraised at $81,500 (August, 2009) when dad passed away (RIP). Needs anywhere from $35-60K in repairs, upgrades, you name it. Will then be worth maybe $95K.

So, bank is out 87K + 5K + 20K + 9K = $121K - 15K paid = $106K on an $81.5K property. Genius.

If they sell it, it will go for maybe $65 tops. They'll only be out $41K, less RE agent commission (6%). Pure genius.

If they rehab it, and sell it for $95K, after, let's say $45K in improvements, they'll only be out $56K. Pure-er genius.

My guess is they'll just sit on it for 2-3 years, like many other properties around here. Rack up another $8-10K in property taxes.

I offered to buy it from them (and have them hold the paper) for $50K, which would have left them short about $47K. They wouldn't even discuss it. Priceless!

Equally Evil Inheritant (me): Tax free, rent-free living for 5 years, 9 months. Total costs of absolutely necessary repairs and maintenance, court filings (BTW: fuck lawyers, too) ~$3K. Monthly "rent" expense, ~$43.48.

But, I get $9K, no deficiency, no whack to credit score (not my property), but have to give up house. I'm ahead about $6K, or, about 1 year's rent.

So, who won?

I think they did. Honestly. Crime pays.

Xrated's picture

Banks are pussies since Obama came in office. Your mortgage should have been foreclosed after the 3rd missed payment, then you would not had haved the time to do $60k in damage. 

There are shitloads of abandoned houses and fucked up illegal rentals here in Florida, and the banks need to take a M4 carbine and law down some firepower. 

I am tired to watching the taxpayers gettting screwed, Joe Blow pension/union arenot losing a dime with Obama backed bailouts, its all about taxpayer strenght in numbers and stupid taxpayers like us. We need to purge Washington with term limits

waterhorse's picture

"When President Obama nominated former Citigroup executive, Jack Lew, to succeed Geithner as Treasury Secretary, the President said: “When the history books are written, Tim Geithner is going to go down as one of our finest secretaries of the Treasury.”


Thanks for saving us from tanks in the streets, Timmy.   I wonder what old Jackie boy has up his sleeve to help foam the runway for the banks this time?  /s

Xrated's picture

They are not called The Bank of Africa for nothing. 

All the unit and team leaders fired were white.

Tim Edwards's picture

Seeing as whitey was running it and has fucked up everything that can be fucked up and robbed everyone blind, it's whitey that needed (needs) to go.