Big Banks' Earnings Beats, Exclusive With BlackRock CEO Larry Fink 7/14/23

SPEAKER_1 (0:00)

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David Faber (0:31)

Market insight and analysis. You're listening to the opening bell of CNBC's Squawk on the Street.

Carl Quintanilla (0:36)

Good Friday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer, David Faber's back at Post 9 of the New York Stock Exchange. Bull's looking to wrap up the biggest weekly rally for stocks since March, and the banks will help out today. Some upside surprises on net interest margin, return on equity, import prices meantime, down six year on year. That's adding to this week's disinflation theme.

Our roadmap begins with the banks though quarterly beats from JPM, Wells and Citi.

David Faber (1:01)

And we're also gonna have an exclusive interview with BlackRock CEO Larry Fink. It is the world's largest asset manager and it posted a jump in earnings and net inflows.

Plus UnitedHealth is among the top gainers on the S&P 500 This after the company raised guidance, reported results above most analysts forecast. It was helped by higher premiums and a smaller than expected increase in medical costs.

Carl Quintanilla (1:24)

Let's begin with the big banks kicking off earnings season, Jim. We made note of their historic under-performance coming into this period.

Jim Cramer (1:31)

Well, except for the majors. JPMorgan was at its 52-week high yesterday, and it turns out to be, of course, justifying that because the numbers were outstanding. JPMorgan is a growth stock.

And what I'm talking about, they're doing everything right. They have efficiencies right.

There's credit card loans up 18%. I mean, these are just growth numbers. It's like a small-cap stock. So I just think you have to take notice of them and just say they are in a class by themselves.

David Faber (2:00)

You think so? Class by themselves.

Jim Cramer (2:02)

Class by themselves.

David Faber (2:03)

And all right, go through more numbers that would show that, or give me some sense as to why you say that.

Jim Cramer (2:08)

Okay, so when you look at what I would say is they're some, the money that they took it, okay, is just extraordinary. The average money that they had, 3.2 trillion, you see that up 16%?

That's the AUM, David, you can't do that. How about iBanking? 1.49 billion versus 1.3 billion. Who did any investment banking in this court?

David Faber (2:33)

Right, they actually had an investment.

Jim Cramer (2:34)

Where did they get this?

SPEAKER_5 (2:36)

Where did they get these?

Jim Cramer (2:39)

I mean, I'm not saying that they're fanciful, I'm just saying that this is just the return on common equity, do you see that?

David Faber (2:47)

Yeah, I did see the return on common equity was 23% after excluding a net after-tax gain of 1.8 billion. But you remember when we said- There was some movement here about, First Republic, as you know, gained some losses associated, more gains than not. But the analysts had that in mind, so it is a real beat, they did.

Jim Cramer (3:04)

And I want people to understand at home, I just gave you a series of numbers that I'm sure just gobbledygook, but what they really are is you have to compare apples to apples, and you just realize that all those categories I just gave you, these are substantially in excess of everybody else's.

So you can just say, well, what is this average unit? Whatever is the amount of money they have under management? They may sound like...

David Faber (3:27)

Well, listen, Wells Fargo and their piece, their quick update on the earnings, Goliath is so, so winning.

Jim Cramer (3:33)

Right. That's what it is. And Carl, one of the things that's so hard about today is you'll have all the major banks reporting, and they're really difficult because there's a lot of lines, like a return on common equity, and people say, well, what the heck is that? I just want people to realize, let's just say these were semiconductors. This is Nvidia.

It's just faster than anybody else.

Carl Quintanilla (3:55)

We're not getting guidance changes like that, but yeah.

Jim Cramer (3:58)

But I'm just, I want to say that there's Nvidia, and then there's everybody else. I have to say that when I look at JPMorgan, there's JPMorgan, and then there's everybody else.

Carl Quintanilla (4:07)

Charge-offs, obviously we were gonna look for it going in.