US banking crisis is not over

Thursday 6 April 2023

I’ve lost count of how many times I’ve read Goldman Sachs and the iMSM declare the banking crisis “easing”. We’re only in the first innings. Next comes the credit crunch then the recession then the asset crunch for banks. Morgan Stanley has a much better take on it all.

1Q23 Earnings Preview: Resetting Expectations Lower

Uncertainty is high given lack of real-time data on individual bank deposit trends. But one thing is clear: Street estimates need to move down meaningfully. We cut 2023/2024 EPS 17%/27%. No one is immune, but favor banks with funding flexibility: MTB, WBS, CFG, CFR, HBAN.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.