Bank of America’s (BAC) Q3 2017

Brian Moynihan – Chairman and Chief Executive Officer

Moderate economic growth projected

“We expect moderate economic growth to continue this year and we expect the US to grow a little faster next year above 2% and outside of US is growing in the mid-3s.”

Consumers are spending

“in our consumer payments we are seeing consumer activity pickup. Consumers are spending, whether it is checks written, cash taken out of the ATM’s, P2P payments, and all the debit and credit cards, 5% more through the first nine months of 2017 than they did in the first nine months of 2016. That’s up faster growth rate than it has been in prior years.”

Optimism persists

“Our commercial clients continue to perform well. They continue to remain optimistic. They continue to look forward to continue implementation of a pro-growth agenda, particularly focused on meaningful tax reform. Housing starts home prices continue to remain on positive trends. Employment is strong and employers continue to search for skilled workers. So that leads to a solid atmosphere and we see no near-term indications of any change to it.”

Paul Donofrio – Chief Financial Officer

A rate hike would be beneficial

“If we get a late 4Q hike, as expected by the market, this should mostly benefit NII in Q1 2018. With respect to asset sensitivity as of 930 [ph] an instantaneous 100 basis point parallel increase in rates is estimated to increase NII by 3.2 billion over the subsequent 12 months. This is largely unchanged from June 30 and continues to be predominantly driven by our sensitivity to short-end rates.”

Citigroup 3Q17 Earnings Call Notes

Michael Corbat – CEO

Macro environment remains positive

“The macro environment remains a largely positive one, growth while not as high as we would like remains consistent and we don’t see too many economies in distress. However, while geopolitical tensions don’t seem to have weighed on growth at least as of yet, I don’t know how long that can continue. And while tax reform remains a question mark we do like the direction the administration is going in terms of regulation which we see as just a course to accommodate higher growth rather than a full scale regulatory repeal agenda.”

Near term challenges from natural disasters

“We’ve obviously also had the near-term challenges of a lot of natural disasters. And whether that’s been hurricanes or earthquakes or flooding damages that it comes as a result of some of those things, those things will have a near-term impact in terms of what growth will look and feel like. But probably as we’ve seen historically in some ways those actually end up being a stimulus in the longer-term in terms of those monies that come back in the form of aid and investment and in rebuilding. And that’s our expectation that we would probably see that occur again.”

John Gerspach

Consumer health pretty good

“I would say it is not just in the U.S. but as we look around the world we would rate the health of the consumer right now is pretty good. And again so you touched on a number of the most important things, so when you look at a consumer what are the things you look at, does the consumer have a job. If they have a job are they going to keep it, if they don’t have a job how difficult is it to get one. And I think as you look across the world unemployment, slow employment is high. Probably the bigger challenge to the consumer or to the worker has been the lack of wage growth and again not just in the U.S. but in many places. And we’re beginning to see some of that and again that’s helping to the consumer.”

No sign of deterioration

“Obviously we are a long way or we’re a long way from the last credit cycle and so we’re always challenging ourselves in terms of where we are. But a lot of the signs we looked for in terms of the deterioration of the consumer I got to say right now, we just don’t see and if you go and look at our NCL rates and look at our delinquency rates around the globe from the document we’ve given you, again the numbers don’t point to it.”

Goldman Sachs at Barclays Conference Notes

Harvey Schwartz – President and Co-Chief Operating Officer

The environment could get better

“We also know that the environment could get better. For example, both interest rate and volatility could increase from near record levels. The yield curve could steepen. Our investing clients could post better performance and have more conviction. There could be more clarity on economic policy and the global economy could grow at a higher rate. Any or all of these factors could drive greater client activity and a better opportunity set for the firm. That would provide even more potential revenue upside to both our initiatives and the firm more broadly.”

JP Morgan at Barclays Conference Notes

Jamie Dimon – Chairman and Chief Executive Officer

US economy doing fine

“The U.S. economy is doing fine, it’s been chugging along at 2%, less than 2% on average probably for the last seven or eight years. It’s the longest – one of the longest recoveries we’ve ever had, 10 years is the longest, I don’t think that has end to not end. I would say a very important factor is it’s been half of a normal recovery.”

Synchronized recovery

“I think the question that then comes to me is, why is it half of a normal recovery and if you do a quick turnaround the world by the way, Europe is doing better than 2%, Japan is doing 1.5% to 2%, China is going to make is 6%, Brazil has gone from negative 4% to 0%. So you kind of have for the first time called synchronized, the first time like 12 years, just about everything is starting to grow a little bit, which I think is a plus for everybody.”

Regulatory environment not changed a lot because don’t have people in their jobs

“I think the regulatory environment has not changed a lot because we don’t have the people in their job, so you now have the OCC head which was passed by the Senate, Randy Quarles, Fed Chair, Vice Chair just passed by the senate. You don’t have an FDIC person yet, so you are not going to have these huge changes in regulations. We don’t expect to have any regulatory legislative changes so that’s not our hope or belief. We do think the treasury laid out a very good math of issues that that should be looked at all calibration.”

Hoping that QE reversal is seamless but who really knows

“The QE is still going on, so like even in the last couple months something like several $100 billion of purchased securities, all you hear now is talk about reversing that….QE, I’m hoping, I think the circumstance which they reverse it are important, so if you have a healthy economy and they are kind of raising rates and reversing QE that is very, very different than if something else is going wrong. I think it’s a little bit of wishful thinking, so I’m not predicting bad things, but you don’t really know, it is going to be a multi-year plan. We hope it’s seamless, we hope it’s painful, the hope the economies are good, what is the chance if not? We never had QE therefore we never had the reversal of QE and it will have some consequences when people reverse it.”

My view is hold onto your hats

“So my view is, hold onto to you hats, it’s not clear and we are going to be sitting here from a year some might get hurt, things might be more volatile of the economy…So, I think that we can’t expect serendipity forever, so as a company while I’m not predicting bad things, we’re always prepared for it.”

One day people will panic

“It’s definitely cyclical folks, I mean you have a volatile market one day again, markets and markets people panic, people panicked in 2008 and 2009, they panicked in the 1989, they panicked in 1994, they panicked in Asia in 1997, they panicked in the Internet thing in 2000, the people will panic, you will panic. You will all be running through the door like everybody else and regulators will panic and – come on, and I just said, the government support $12 trillion securities that has to have some effect on depressing volatility, particularly around all the benchmark, all the benchmarks. Remember the benchmarks do affect the non-benchmarks and stuff like that. So market will become more normal again one day and again I think the most important thing to keep in mind is the why”

Credit is almost the best it’s ever been

“Well, it’s not credit. You know if you look at credit, it’s almost the best it’s ever been ever, so also my credit card, middle market, large corporate, there are tools, there is exception of subprime, I do think somebody get hurt leasing in subprime, but it’s not systemic, there is problems to lending, but it’s owned by the government which means you’ll never know about it, though you will pay for.”

Bitcoin is a fraud

“The currency isn’t going to work okay you can have a business where people can invent a currency and that’s in air. And think the people who are buying it are really smart. It’s worse than two of the balls okay it won’t end well. And it won’t end well for two reasons. One is someone’s going to get killed and then the government is going to come down. The second is you just saw in China governments like to control their money supply. The first thing a nation does when it forms itself literally the first is form a currency they have a bank and it has some kind of support legal support legal tender sometimes support like gold or silver that is a currency. So whatever and where think that bad that is this one is worse. So it will blow up China just kicked them out it’s selling through its money somewhere else it will be but I don’t ask me if it is short I’m not going to it could be 20,000 for this happens, but it will eventually blow up it’s a fraud okay. And honestly I’m just shocked anyone can see it what it is.”

BB&T at Barclays Conference Notes

Kelly King – Chairman and Chief Executive Officer

Loan growth lower because higher payoffs amid lower rate environment

“When we announced our second quarter earnings in July, things were actually moving at a pretty good pace, and we were more optimistic. So we had a higher guidance for loan growth at 1% to 3% from the third quarter. We’re now revising that to be slightly down for the third quarter. And here is why. So, obviously, you will not to see – not like to see average loan growth go down. But in this case, after analyzing, what happened is loan production, loan pipelines have continued. It’s just that in late July, early August, when we saw a material reduction in long-term rates, there was a huge spike in payoffs. And so that’s kind of an uncontrollable event.”

Not concerned about loan growth

“What I think the importance is, as rates begin to creep backup and as those payoffs exit the systems, you’ll see a more return to more kind of normalized loan growth in this period of time. So we’re not concerned about loan growth. We believe it will be steady and solid as we go forward. Hard to know exactly what it will be for the fourth quarter right now, because it’s hard to predict those level of payoffs. But certainly as we head into 2018, we think those payoffs will subside and we will continue to have a good solid loan growth.”

Main street is coming back

“Main Street is beginning to come back. When I travel around, I just completed my tour of our 26 regions, visiting with business people and our lenders in those marketplaces. I’ll tell you that small and medium-sized business people are much more confident, much more optimistic, they’re beginning to make replenishment type investments and that is beginning to cause more activity for us in that marketplace. ”

Digital is happening even faster than it was

“The digital focus is a really big deal today for all of us in banking. Frankly, it is changing really fast and a bit faster frankly than a few years ago. I might have guessed, but it is moving in a very, very fast and positive direction. The key there is for banks to be investing properly in their digital platform, in the digital marketing, and all aspects on digital interaction with our clients and BB&T is doing.”

Small business has been more optimistic since the election but still waiting to make expansion investments

“Consistently what I have found is, after the election they immediately became more optimistic and started moving towards investing what I call passive or replenish investment. These companies will tell you consistently that they have been driving folks with 350,000 miles, they’ve using 20 year old computers, and they just been scared to death laying, because all of the taxes, all the health reform, all the regulations are just in place. So after the election they became more optimistic, they started making replenishment, replacing their fleet, now they are not doing expansion or investment, yes they are not building expanding the plant, they are not adding a lot of new products and services. In that case, that – they are waiting on I think mostly tax reform. I think when you see tax reform, I personally believe will happen by the first quarter or so of next year, and I’m saying that will move then from just passive or replenishment investing to expansion oriented investment, which will call the GDP to kick up from the 2% kind of range to 2.75% to 3%.”

WR Berkley 2Q17 Earnings Call Notes

Robert Berkley

A ground swell of competition

“Without a doubt there is a grown ground swell of competition. You can see it manifesting itself in a couple of difference ways. A couple of macro observations will be the standard markets, particularly national carrier seems to be expanding their appetite and spilling over into what a while had been viewed as specialty market exposure. We also are seeing a state-assigned risk plan beginning to depopulate, again as carriers are I guess expanding their appetite if you will.”

Insurance Tech has become the flavor of the day

“Few other macro comments from my perspective on the marketplace, overall. Certainly over the past several years we have seen more and more progress and to a certain extent chatter and buzz around data and analytics. More recently there have been new technologies that are developed and Ensure Tech has become sort of the flavor of the day to a certain extent. Having said this, we think all of these tools have great value and we are users of them and quite frankly we are investors in some Ensure Tech opportunities. Having said that for our perspective, when the day is all done these are just tools and ultimately how effective they are, how helpful they are will be determined by the people who are using them and the expertise that they have”

Moelis & Co 2Q17 Earnings Call Notes

Kenneth Moelis – Chairman and CEO

Companies waiting to see what happens with tax before inverting

“there’s a hold waiting to see what happens with tax. I think there were some industries that felt like the U.S. tax rate was not competitive and they were looking to do inversions for a few years. I think there’s a feeling now and a hope that’s worth waiting for. It’s sizable enough that we may solve our own tax problem. So not to do an unnatural act here while waiting to see what happens. Look, if that goes on another year, maybe they will run out of patience. But I think, for the time being, there is a feeling that, that particular problem might get solved.”

Outlook for retail and restructuring

“I think there’s a fundamental need to rationalize. People want to get larger to fight online and to fight Amazon and retail specifically. And there’ll be restructurings as well. Now the last time I was asked this, this would retail step in for energy? And the answer is I don’t believe it’s going to be as big an opportunity as energy. Energy was a very, very large user of capital in the leverage world. So I think retail will undergo both, but I don’t think it’s worth — I don’t think it’ll be so large that it’ll step in and replace things like energy in the restructuring world. But it will be — yes, there’s a lot of restructuring going on in the retail business, but a lot of those are smaller companies who are just kind of closing stores and shutting down, in some cases. So yes, I do think you’ll see some of both.”

I’m sensing an upturn in the European business

“Yes, I’m sensing a bit of an upturn in European business. I think some of it’s, us, doing better as a group. So I always like when you guys ask us these questions, we only have — we have a small portal into it. But we do — we feel like the general market is getting more upbeat on doing things and we feel like we’re having a better year and have organized Europe and feel much better about our activity there. So yes, I think it’s steady — I wouldn’t expect a spike, but I think — I feel like there’ll be a steady improvement in European corporate activity”

Moodys 2Q17 Earnings Call Notes

Raymond W. McDaniel, Jr.

Certainly has been some pull forward financing

We certainly think that there has been pull-forward into the first half, including the second quarter. How much opportunistic financing is still going to occur in the second half pulling forward from 2018, we’ll just have to see, but borrowing conditions do remain good, rates are low, spreads are narrow. So, that’s all positive.

Robert Fauber

Broad base of issuers

“we saw very strong issuance from issuers who are typically infrequent issuers rather than issuers on relationship based arrangements with us. As Ray mentioned, U.S. bank loans, we saw a very healthy activity there. And we benefitted from issuance that was a bit more broad-based than last year where we had several kind of super-jumbo transactions included in the volume. So, this broader issuance generally leads to better revenue yield. We had very strong growth in first time mandates also contributing to that favorable mix. And as Ray mentioned, some pockets of very strong issuance growth, particularly outside the United States, EMEA bank loans, Asian corporate finance, Canada, to spotlight three.”

Capital One 2Q17 Earnings Call Notes

Richard Fairbank

Exceptional opportunity has run its course, now just a good opportunity

“we believe the opportunity to grow continues in the card business. What I would say is the exceptional opportunity has mostly run its course and now there’s a more just there is just a good opportunity let’s talk about the exceptional opportunity for a second while a lot of people were not — they weren’t as heavily marketing and not as seeing the growth opportunity that we saw, we pretty much captured several years of outsized growth and I think that it served us very well even though we all know of course the upfront costs of that in terms of credit and allowance have been little rough on the P&L. What I think has happened over time, the competition has definitely intensified but it’s not irrational. ”

Banks have to do a better job of taking the impact of disruption into account

” even before the day finally comes when we down the road we’re all doing our work in the back seat and there is no driver long before that I think we all have to be very vigilant about what is the impact of technology change is there come to be I mean generally the quality of technology has sometimes allowed cars to last longer and has been a good guy in the auto business. But the question is will there be a tipping point where the old cars just don’t cut it and the new ones are so much better. So this in fact I just want to pause for a second and just kind of seize the moment that one of the — one of the things that I don’t I think banks don’t do that well I think Capital One did not do that well on things like Uber story is pull way up across all of our lending businesses and ask what is the impact given that industry after industry is being revolutionized, what is the impact especially I think in the commercial C&I business of the revolution that’s going on in our clients’ businesses and if we just go and make one loan at a time and do our nice underwriting standards we could wake up and have a lot of rude surprises like we did in the taxi kind of business.”

BB&T 2Q17 Earnings Call Notes

Kelly King – Chairman and Chief Executive Officer

Main street continues to rebound

“I just want to mention to you again that Main Street continues to rebound. Our confidence is up. I’ve been in 23 of our 26 regions in the last few months. Every single region is reporting in terms of – and I’m talking to the people that are making the loans, everyone is talking about increased optimism on the part of small- and medium-sized businesses. Main Street, as I’ve talked about over the years, has been kind of dead in the water for the last seven or eight years.”

Using AI and robotics to reduce costs

“Finally, with regard to expenses, we are laser-focused on expenses. We have a number of expense initiatives. We are using, for example, artificial intelligence, AI, robotics and moving across our backroom. Just to give you a flavor for that, Daryl did a really nice job earlier this year in taking just one project, one smaller project where we have in the accounting area, account reconciliation one person with a computer, one software reconciling account that took two hours. We put robotics on top of that. And in a virtual period of time, the new robotics software could do it in 15 minutes. So we now have six or seven more substantial projects that we are moving through to further improve the case, after which we will be going enterprise-wide in terms of finding ways to take these repetitious activities and apply good digitization and artificial intelligence to find more efficient and effective ways to reduce our cost.”

Regulatory pressure is lifting

“We believe we have been through eight years of having to deal with an extreme amount of micro management regulatory pressure. We believe that is lifting. And we are going to be focusing on how to run our business based on what makes sense to us. And so I’m challenging everybody to go back and reconceptualize their business and, frankly, be prepared to run their businesses with less resources.”

Our current portfolio is clean as a whistle

“There are no credit issues. Our current portfolio is clean as a whistle. We just have these two portfolios, about $30 billion in mortgages and about $10 billion in auto, that are sub-optimizing in terms of performance. And so in a rising rate environment, you don’t exactly want to keep growing real fast your mortgage fixed rate portfolio, and I think everybody understands that. And the auto portfolio, we started 1.5 years so ago changing the nature of how we have our revenue-sharing arrangement with these dealers. We are an outlier in the industry, but it is a better, more consumer-friendly approach that we are taking.”

People are optimistic

“Everything we’re seeing in terms of commentary from the client, this is I’m getting from talking to our lenders. I’m getting it from talking to the business people. I’ve had 23 lunches where I’m sitting and talking to six to eight business people over the last few months. I’ve gotten this across our entire footprint. I’ve got a pretty good feel what the clients are directly saying. I’ve got a really good feel of what our production people are saying. And I’ve got a good feel for what the actual pipeline shows.

Can’t guarantee that Washington wont derail it but people not focusing on it. People are expecting a tax deal though

All of that is very, very positive. And can I guarantee that all the craziness in Washington will not derail that? No. But I’ll be honest with you as I’ve talked to business people out there, they’re not worried about all this craziness going on in Washington. They’re just focusing on growing their business. Now I will say I think they are expecting a tax reduction deal and, to a lesser degree, they’re counting on infrastructure. But if we get the tax reduction deal, they’ll continue.”