Big banks are raking in monster profits — and they can thank President Trump for their success. Trump’s corporate tax cuts helped fuel Wall Street’s blockbuster first-quarter results. Ditto for the recent market mayhem, which Trump played a starring role in at times. Morgan Stanley and Bank of America (BAC) both revealed record quarterly earnings this week. A critical measure of profitability at Goldman Sachs hit a five-year high. And banking king JPMorgan Chase (JPM) hauled in $8.7 billion during the first three months of 2018. That’s the largest quarterly profit by any US bank — ever. Big banks are also cashing in on the stronger economy, which has modestly increased demand for mortgages, car loans and business borrowing. “The results are certainly very impressive. The underlying fundamentals of banking is quite strong,” said Nicholas Colas, co-founder of DataTrek Research. The industry got a huge boost from the Republican tax law. Banks traditionally pay high tax rates, making them among the biggest winners from the corporate tax rate falling from 35% to 21%. Bank of America’s bill to Uncle Sam plunged by 26%, even though the No. 2 US bank earned 30% more. Morgan Stanley’s (MS) effective tax rate tumbled… Read full this story
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