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Goldman, Morgan Stanley Mark Robust Earnings Week for Banks
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Good morning, CFOs. Stronger-than-expected profits for financial services firms, with latest results landing from Goldman, Morgan Stanley; Philly Fed President Paulson throws support to Powell; Warner Discovery doesn’t need to share Netflix deal details, judge rules.
Note: The Morning Ledger will be taking a break on Monday for the Martin Luther King Jr. Day holiday. See you back at this space on Tuesday.
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Goldman Sachs and Morgan Stanley capped off this week’s earnings results, which showed how banks are benefitting from a surge in dealmaking and optimism over IPOs, led by expectations for tech companies going public.
Goldman reported a stronger-than-expected profit in the fourth quarter and record annual revenue in the bank’s investment banking and markets division last year, while Morgan Stanley too reported better-than-expected profit and revenue to end the year, boosted by deals (along with a 47% jump in investment-banking revenue).
Industrywide dealmaking numbers are inching back to their all-time records. Globally, merger and acquisition activity increased 44% in 2025 from a year earlier, AnnaMaria Andriotis reported.
Some banks also expressed support for the Trump administration’s affordability efforts, including a call by Trump to limit credit-card rates to 10% for one year. The details of how that would be carried out weren’t immediately clear.
The following are some of the key CFOs quote we compiled from this week’s earnings calls:
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Citigroup CFO Mark Mason: “An interest-rate cap is not something that we would or could support,” Mason said on a call with reporters, noting that it would “restrict access to credit to those who need it the most, and frankly, would have a deleterious impact on the economy.”
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Wells Fargo CFO Mike Santomassimo said [a rate cap] would “have a negative impact on economic growth.”
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Bank of America Chief Financial Officer Alastair Borthwick, speaking about the U.S. consumer: “All of the metrics that we can see tell us the consumer remains resilient and in great shape,” he said on a call with reporters
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Goldman Sachs CFO Denis Coleman, on investment banking and IPO business: “If you look at sort of industry-wide volumes in the various categories of investment banking activities, compare it to the last five years, a number of them have started to trend above the average level. One that's decidedly below the averages remains the IPO business for equities. That's a lucrative business that we have a very longstanding leadership position in.”
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Morgan Stanley CFO Sharon Yeshaya: “Strategic activity is accelerating. Companies and sponsors are looking to access capital for growth investments and the reopening of the IPO market creates additional opportunities for clients.”
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Content from our sponsor: Deloitte
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Agentic Commerce: Strategic Implications for Retail Brands
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In the next stage of AI-powered shopping, AI agents may research products and make purchases on behalf of consumers. Retailers that adapt to agentic commerce early could gain an edge. Read More
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📆 Earnings
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M&T Bank
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PNC Financial Services Group
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Regions Financial
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State Street
📈 Economic Indicators
The National Association of Home Builders releases its Housing Market Index for January.
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What Else Matters to CFOs
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Philly Fed President Anna Paulson said she could favor cutting rates modestly later this year. HANNAH BEIER FOR WSJ
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Support keeps flowing in for Fed Chair Jerome Powell, after he disclosed on Sunday that he is facing a criminal investigation related to the renovation of the Fed’s Washington headquarters.
“So many people have been impressed by his leadership, myself included,” Philadelphia Fed President Anna Paulson told Nick Timiraos in an exclusive interview this week, her first with a national outlet since taking the job last July.
Key quote: “His statement was really strong. I think it really speaks for itself,” said Paulson, who supports holding interest rates steady at the coming meeting. Powell “has been a very effective chair,” as were his predecessors, she said. “We’ve had really strong leadership at the Federal Reserve for many decades, and I think that’s been to the benefit of the American people.”
✏️ Share your thoughts. What is most notable to you in Anna Paulson’s remarks? Join the conversation at the end of the story, or by hitting Reply to this newsletter.
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📰 Other headlines
📈 Earnings wrapup
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The WSJ CFO Council Summit
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This March 23–24, financial leaders will gather in Palo Alto for The WSJ CFO Council Summit to examine how CFOs are navigating market volatility, evolving trade and regulatory policy and the growing impact of AI on the future of the enterprise. Join the CFO Council and be part of the conversations shaping the future of finance and corporate leadership.
Request Invitation.
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Explore The Wall Street Journal Webinar: From Headlines to Action
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The Wall Street Journal helps your employees connect what’s happening in the world to your company goals. The Journal’s award-winning journalists interpret news and data to tell unbiased stories to help your employees stay informed and make confident decisions.
Join us on Jan. 29 for a deep dive into the challenges that CFOs and other top executives are working to overcome, including the impact of tariffs and geopolitical conflicts on corporate finance and private equity.
Register here.
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The Wall Street Journal's CFO Journal offers corporate leaders and professionals CFO analysis, advice and commentary to make informed decisions. We cover topics including corporate tax, accounting, regulation, capital markets, management and strategy. Follow us on X @WSJCFO. The WSJ CFO Journal Team comprises reporters Kristin Broughton, Mark Maurer and Jennifer Williams, and Bureau Chief Walden Siew. You can reach us by replying to any newsletter, or email Walden at walden.siew@wsj.com.
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