Profits for JPMorgan Chase (JPM) and Wells Fargo (WFC) surged in the second quarter while falling sharply at Citigroup (C), demonstrating a divide in how the banking world is faring as it recovers from a period of extreme turmoil.
JPMorgan and Wells Fargo showed that some giants can continue to make lots of money from consumer loans even as industry deposit costs rise, while leaning on their sprawling franchises to generate additional revenue.
What Citigroup revealed is that a number of problems continue to plague even the biggest institutions, especially those that rely heavily on dealmaking and trading.
Citigroup’s profit tumbled 36% in the second quarter, largely because of weaknesses in its Wall Street unit.
Other banks reporting next week, such as Goldman Sachs (GS) and Morgan Stanley (MS), could run into similar challenges.
“The long-awaited rebound in investment banking has yet to…
