The profits of the U.S. banks continue to rise, but the trend is due largely to fewer resources allocated to cover potential losses announced by the federal Agency for Deposit Insurance. The banking sector gained 28.8 billion dollars in the second quarter of 2011, which is 7.9 billion dollars over the same period last year. The agency warned again that this increase in profit can not be supported simply by reducing the resources allocated against losses.
“Since the levels of reserves against losses approaching historic levels, the prospects for increasing profits thanks to lower reserves further decreased,” said acting chairman of the board of directors of the agency Martin Gryunbarg in his note. The revenues of banks continued to decline. In the second quarter operating income decreased by $ 3 billion or 1.8% compared to levels from the same period of 2010, by the agency. The positive signal for the sector is that part of the credit balance is increased for the first time in three years by 0.9% to 64.4 billion dollars.
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The rapid jump in oil prices early this year and improved returns from refining are probably brought solid gains of major oil companies in the first quarter. It is not excluded that the profits of American oil companies for this year can compete with record levels for the industry since 2008, said publication. Then oil prices reached $ 147 a barrel, marking its highest levels in history. In the first quarter price of a barrel of oil rose to an average $ 100, which is about 20% more than a year ago. The reason for this were mostly concerns about breaches of its exports because of political unrest in the Arab world. The recovery of world economy at the same time intensify speculation about higher oil demand, which also supported the price of the black gold. The jump in oil prices expected to rise by about 50 per cent profit on the largest U.S. oil company Exxon Mobil in the first quarter. For the second and third largest U.S. oil companies Chevron and ConocoPhillips this growth is estimated to be about 33% annually. Of course, the year is still in its beginning and forecasts for record profits is too early to judge. Prices of U.S. light crude hover over 112 dollars a barrel in New York and about 124 dollars a barrel Brent crude in Europe. This unusually large difference in oil prices, sold in the U.S. and Europe, however, can support the profits of U.S. oil companies in two ways.
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The yield on corporate bonds goes up for the fourth consecutive quarter that has not happened since 2004, cited by Bloomberg. Their return will be increased by 2.6 percentage points in the first quarter of this year after record profits by 16% in 2009. The increase was the largest since the U.S. bank Bank of America Merrill Lynch results statistics for return on corporate bonds. Rally of the debt markets worldwide to enhance the appearance of first signs of recovery in the economy. As a result, companies worldwide have issued debt for 730 million dollars in this quarter, which is 25% more than the same period of 2009 interest rates in the U.S. and many developed economies fell near zero a year ago, and this has led investors to seek riskier assets and bring them higher returns. In this week showed that sales of high-risk corporate bonds rose to a record 38.9 billion dollars within the first three months of the year. These are corporate debt securities rated below Baa3 by the system of Moody’s.
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The U.S. company Kraft Foods, which is the largest producer of food products in the U.S., please their shareholders with news that its profits had tripled in the last quarter of 2009, a primary source of this impressive growth is the increase in the volume of its sales in developing countries and the rise in the prices of its products forward AP. Its net profit increased to 710 million dollars, or 48 cents a share, in the last quarter of 2009 compared with a positive result of 178 million, or 12 cents per share for the same three months of 2008, Kraft Foods is the second largest food company in the world and one of the 30 largest U.S. companies entering the index of blue chip Dow Jones IA. Market Analysts forecast lower earnings per share from 45 cents. Kraft Foods sales increased by 3.2 percent annually to 11 billion dollars in the quarter in question, which was close to the projected revenue from the market. Company sales in Europe increased by 8% annually, while revenues from sales in developing countries have risen by 11 per cent. The company management plans to turn into Kraft’s largest producer of confectionery in the world. In January, Kraft Foods has been able to obtain the approval of the shareholders of British chocolate maker Cadbury to absorb the company against the amount of 11,5 billion pounds.
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The biggest French car company PSA Peugeot Citroen announced that a loss of 1.16 billion euros after tax last year. Leadership expected to come out of operating profit in the first half of 2010, although the company will face serious challenges over the next few years forward Financial Times. The largest of them will be shrinking car market in Europe, according to the French group for the production of cars will fall by around 9% this year. To overcome this, Peugeot Citroen plans to market a new model by which to increase its market share. The net loss for the French company has tripled in comparison to the negative financial result of 363 million euros for 2008, its sales decreased by 7.2% yoy in 2009, which forced the company to seek more than 3 billion . EUR rescue assistance from the French state last year. The negative financial result of the first half of last year was positive in the second half thanks to government programs worldwide, including France, to stimulate purchases of new cars. Peugeot Citroen has a positive net cash flow In 809 million euros for 2009. Leadership trusts that the successful implementation of the plan for sales management, cost reduction and better utilization of capacity will support the company’s financial performance this year, along with the launch of new models on the market. Our presentation of the financial unit Banque PSA Finance also contribute to profit in the first half.
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