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URL:  https://boards.fool.com/i39m-certainly-no-expert-on-bac-but-the-34053207.aspx

Subject:  Re: Maystery purchase Date:  11/4/2018  10:59 AM
Author:  mungofitch Number:  239434 of 243205

I'm certainly no expert on BAC but the rearview mirror may not be very helpful in this case. In the last quarter ROA was 1.23%, ROE 11% and ROTCE 15.5%.

True, those are good numbers for a bank these days.
I guess it depends on whether you think a single quarter is a sufficient sample.
First three quarters, all of the data with the tax cut, ROA 0.85% and ROE 7.43%. That I wouldn't buy.

The optimist: bad one-off things happened in Q1 and Q2 and/or things are improving rapidly, so Q3 better represents the new normal.
The pessimist: Q3 was a short term lucky blip.

I find it interesting that so much of the improvement in net interest margins in the last year or two
among large US banks is not from a steepening [government] yield curve, nor even (much) from rising loan rates.
In effect, they've mainly been putting the screws to depositors like a monopoly/oligopoly---despite not being one.
Policy short term rates have risen, but the rates paid out on accounts have barely budged at big banks.
They seem to be wagering that people are used to lending them money for free and will continue do to so forever even if there are alternatives.
Some on line (FDIC insured) banks are paying 1.98%, and "bricks and mortar" are still paying paying a national average of 0.09%, difference 1.90%.
Typical gap 1.6-1.8%.
The gap has doubled since 2014, so competition isn't working they way you might expect it to.
They are really seriously betting on the stickiness of deposits (customers=chumps), and that there will be no tipping point of customers wising up.
Anybody in the US with cash on deposit at a bank should check out MaxMyInterest.com or similar.

From Goldman's new Marcus division for Nov 4: they're offering 2.05% APY with $1 minimum.
Their site says Oct 30 rates for WFC = 0.01%, BAC 0.06%, Citi 0.04%, Chase 0.04%, data for $2500 balance.
So, which bank is treating their clients as "muppets" now?
Let's hear it for the vampire squid.

Jim
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