U.S. Banking Quarterly Comment: 1Q17 (Loan Growth Comes to a Halt)

...Net Income Generally Higher: Twelve of the 18 banks included in this report saw higher net income in 1Q17 than in 4Q16. Quarterly results were higher a year ago for all but four of the featured banks. Highlights during the quarter included improved capital markets results, lower taxes owing to new accounting guidance and modest improvement in spread income due to recent rate hikes. Partially offsetting this, loan growth came to a halt, expenses and credit costs rose and mortgage production-related revenues slowed, as expected following the rate hikes. New Accounting Guidance Benefits Some: During the quarter, several banks adopted new stock-based compensation accounting guidance, which produced one-time tax benefits for them. GS in particular saw a large benefit, with the accounting change responsible for 21% of its net income. The new guidance required all the tax effects related to share-based payments to be recorded through the income statement, which had previously run through capital....

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