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FACTBOX-Big U.S. banks fail to impress, Morgan Stanley stands out

(Adds BofA, Goldman Sachs and Morgan Stanley results)

July 14 (Reuters) - Most big U.S. banks reported better-than-expected quarterly profits but failed to enthuse investors who were looking for better results and a sunnier outlook.

However, Morgan Stanley, which wrapped up big bank earnings on Wednesday, managed to pull a rare feat in producing more trading gains than rival Goldman Sachs.

While trading and mortgage lending remained weak, the banks started to see some long-awaited benefits of higher interest rates.

A snapshot of the earnings of the banks that reported:

JPMorgan Chase & Co

* Earnings (beat) - EPS $1.71 vs est. $1.58

* Revenue (beat) - $26.41 bln vs est $24.96 bln

* Story - http://reut.rs/2tR3ISH

* Helped by: - Lower provisions for credit losses, down 13.3 pct to $1.22 bln - Loan growth; average core loan book grew 8 pct vs year earlier

* Hurt by: - Slump in mortgage banking income, down 26 pct - Jump in expenses, up 6.4 pct - Markets revenue falls 14 percent, led by 19 pct decrease in fixed-income markets revenue

* Forecast: - Smaller FY net interest income, +$4 bln vs

+$4.5 bln forecast previously - FY 2017 average core loan growth to be about 8 pct vs 10 pct estimated earlier - Expects credit card loss rates to go up as company makes more loans

* Comment: - Interest rate movements "a tale of two cities," in which Wall Street businesses change quickly, but Main Street customers are not yet demanding more money for their deposits - Chief Financial Officer Marianne Lake Bank of America Corp:

Earnings (beat) - EPS 46 cents vs est. 43 cents Revenue (beat) - $22.83 bln vs est. $21.78 bln Story - http://reut.rs/2tbjKUE Helped by:

- Rise in net interest income, up 8.6 pct to $10.99 bln

- Jump in profit from consumer banking business; up 21.4 pct at $2.03 bln

- Higher efficiency ratio, up at 59.51 from 62.73 y-o-y

Hurt by:

- 9 pct fall in trading revenue, mainly due to a 13.8 pct drop in FICC revenue

Forecast:

- Expect 3Q17 markets results to face tough comparison with exceptionally strong 3Q16 - CFO

- Expects higher net interest income in Q3 vs Q2, as long as 'forward yield curve is realized and we see some loan and deposit growth' - CFO

- Will hire 200 bankers in global banking unit by end of 2018 - CEO

- Still very confident about hitting $53 bln expense target for FY2018 - CFO

Comment:

- "Not interested in acquisitions to deploy excess capital: We just don't need the distraction" - Chief Executive Officer Brian Moynihan

Wells Fargo & Co:

* Earnings (beat) - EPS $1.07 vs est. $1.01

* Revenue (missed) - $22.16 bln vs est. $22.47 bln

* Story - http://reut.rs/2tRfooM

* Helped by:- Steep drop in provisions for credit losses, nearly halves to $555 million - Rise in net interest income, up 6.4 percent

* Hurt by:- Slump in mortgage banking income, down 18.8 percent- Higher expenses, up about 5 percent

* Forecast:- Expects litigation costs to rise by up to $1.3 billion at higher end of range - CFO- Auto loans to continue to decline in 2nd half - CFO- Mortgage income likely to be 'volatile' ahead due to more competition - CFO

* Comments:- "EPS looks a tad light as a lower-than-expected loan loss provision and tax rate was used to help offset weaker-than-expected fee income" - Jason Goldberg, Managing Director from Barclays Citigroup:

* Earnings (beat) - EPS $1.28 vs est. $1.21

* Revenue (beat) - $17.90 bln vs est. $17.37 bln

* Story - http://reut.rs/2tQVfPr

* Helped by:- Drop in trading revenue smaller than lender's forecast, 7 percent vs 12 percent decline projected by company- Growth in loans, up 2 percent

* Hurt by:- Rise in operating expense, up 1.3 percent- Declines in fixed income and equity trading revenues; fixed-income slips 6 percent, equity falls 11 percent

* Forecast:- We feel very good about meeting targets for return on equity - CEO Mike Corbat

* Comments:- "We are still hopeful that we will get some solid changes to boost economy" - Chief Financial Officer John Gerspach

Goldman Sachs Group Inc:

Earnings (beat) - EPS $3.95 vs est. $3.39 Revenue (beat) - $7.90 bln vs est. $7.52 bln Story - http://reut.rs/2vxLrbl Helped by:

- Dip in operating expenses, down about 2 pct at $5.4 bln

Hurt by:

- Slump in bond trading revenue, down 40 pct

- Drop in investment banking revenue, falls 3.2 pct

Forecast:

- To improve bond trading broadly, Goldman is looking for ways to do more business with existing clients - CFO Marty Chavez

Comment:

- "Commodities is a story of challenges on all fronts, it was lower client activity and difficult market making environment" - CFO

Morgan Stanley:

Earnings (beat) - EPS 87 cents vs est. 76 cents Revenue (beat) - $9.50 bln vs est. $9.09 bln Story - http://reut.rs/2uzslEO Helped by:

- Higher underwriting gains drive investment banking revenue

- Wealth management revenue up 9 pct at $4.2 bln

Hurt by:

- Bond trading falls 4 pct to $1.3 bln

Forecast:

- We are on track to complete project Streamline - CFO Jon Pruzan

- Uncertainty over taxes, regulatory reform likely to weigh on M&A activity - CFO

Comment:

- "This quarter's results reaffirm that our strategy is working...this quarter represented an important test of our model" - CFO

BREAKINGVIEWS:

BofA's progress fails to achieve escape velocity

Goldman's compass points in wrong direction

Morgan Stanley gives Goldman a lesson in diversity

Citi, JPMorgan and Wells show reliance on D.C.

(Reporting By Aparajita Saxena, Nikhil Subba and Sruthi Shankar in Bengaluru; Editing by Sriraj Kalluvila)