Banks in the US racked up strong second-quarter profits this year. Many, however, still plan job cuts.
Goldman Sachs made about US$1 billion (Dh3.67bn) for the quarter, up 77 per cent from the same period last year. But it plans to reduce its workforce by about 1,000. Wells Fargo, one of the country's four biggest banks, made $3.9bn, up 29 per cent. It is planning 1,900 job cuts.
Cutting jobs while enjoying big profits might appear irrational, but analysts say the banks are making sound decisions.
Many have done well only because they funnelled money set aside during the financial crisis back through their income statements. They were, in effect, taking money from their savings accounts, putting it into their current accounts and calling it income.
The reality is that even though profits are strong at some banks, revenue growth is less appealing.
Wells Fargo, for example, saw net revenues decline 5.8 per cent in the second quarter compared with the same period last year. Its profits were up, but the amount of money coming in the door was down.
The problem is partly that people are not borrowing as readily - or as much - as they did before the global downturn. That has hurt revenues and will trickle down to the bottom line once banks exhaust the cash reserves they can write back on to their income statements as profits. With benchmark interest rates near zero and almost sure to stay there for years, the prospect of higher revenues any time soon is dim.
Banks make less money on loans in low-interest-rate environments.
Compounding their problems, US banks are still feeling the effects of the four-year-old subprime mortgage crisis. Bank of America lost $8.8bn in the second quarter because of low interest rates and mortgage defaults. Europe's banks face the added risk presented by the continent's sovereign debt crisis. Against that backdrop, some lenders there are cutting jobs even as both profits and revenues climb.
HSBC, for example, made $5bn in the second quarter, up 23 per cent from a year earlier. Revenues also rose. But it still pledged to cut 30,000 staff - the largest round of layoffs announced this summer.
afitch@thenational.ae
Dark Souls: Remastered
Developer: From Software (remaster by QLOC)
Publisher: Namco Bandai
Price: Dh199
THE CLOWN OF GAZA
Director: Abdulrahman Sabbah
Starring: Alaa Meqdad
Rating: 4/5
Christopher Robin
Starring: Ewan McGregor, Haley Atwell, Jim Cummings, Peter Capaldi
Three stars
The specs: 2018 Jaguar F-Type Convertible
Price, base / as tested: Dh283,080 / Dh318,465
Engine: 2.0-litre inline four-cylinder
Transmission: Eight-speed automatic
Power: 295hp @ 5,500rpm
Torque: 400Nm @ 1,500rpm
Fuel economy, combined: 7.2L / 100km
Fixtures:
Wed Aug 29 – Malaysia v Hong Kong, Nepal v Oman, UAE v Singapore
Thu Aug 30 - UAE v Nepal, Hong Kong v Singapore, Malaysia v Oman
Sat Sep 1 - UAE v Hong Kong, Oman v Singapore, Malaysia v Nepal
Sun Sep 2 – Hong Kong v Oman, Malaysia v UAE, Nepal v Singapore
Tue Sep 4 - Malaysia v Singapore, UAE v Oman, Nepal v Hong Kong
Thu Sep 6 – Final
JUDAS AND THE BLACK MESSIAH
Directed by: Shaka King
Starring: Daniel Kaluuya, Lakeith Stanfield, Jesse Plemons
Four stars
Ads on social media can 'normalise' drugs
A UK report on youth social media habits commissioned by advocacy group Volteface found a quarter of young people were exposed to illegal drug dealers on social media.
The poll of 2,006 people aged 16-24 assessed their exposure to drug dealers online in a nationally representative survey.
Of those admitting to seeing drugs for sale online, 56 per cent saw them advertised on Snapchat, 55 per cent on Instagram and 47 per cent on Facebook.
Cannabis was the drug most pushed by online dealers, with 63 per cent of survey respondents claiming to have seen adverts on social media for the drug, followed by cocaine (26 per cent) and MDMA/ecstasy, with 24 per cent of people.
How it works
Each player begins with one of the great empires of history, from Julius Caesar's Rome to Ramses of Egypt, spread over Europe and the Middle East.
Round by round, the player expands their empire. The more land they have, the more money they can take from their coffers for each go.
As unruled land and soldiers are acquired, players must feed them. When a player comes up against land held by another army, they can choose to battle for supremacy.
A dice-based battle system is used and players can get the edge on their enemy with by deploying a renowned hero on the battlefield.
Players that lose battles and land will find their coffers dwindle and troops go hungry. The end goal? Global domination of course.
TOURNAMENT INFO
Opening fixtures:
Friday, Oct 5
8pm: Kabul Zwanan v Paktia Panthers
Saturday, Oct 6
4pm: Nangarhar Leopards v Kandahar Knights
8pm: Kabul Zwanan v Balkh Legends
Tickets
Tickets can be bought online at https://www.q-tickets.com/apl/eventlist and at the ticket office at the stadium.
TV info
The tournament will be broadcast live in the UAE on OSN Sports.
Our legal columnist
Name: Yousef Al Bahar
Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994
Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers
About RuPay
A homegrown card payment scheme launched by the National Payments Corporation of India and backed by the Reserve Bank of India, the country’s central bank
RuPay process payments between banks and merchants for purchases made with credit or debit cards
It has grown rapidly in India and competes with global payment network firms like MasterCard and Visa.
In India, it can be used at ATMs, for online payments and variations of the card can be used to pay for bus, metro charges, road toll payments
The name blends two words rupee and payment
Some advantages of the network include lower processing fees and transaction costs
Brief scoreline:
Wales 1
James 5'
Slovakia 0
Man of the Match: Dan James (Wales)
