CNNMoney reports that Bank of America (NYSE: BAC) reports that its earnings fell 41% in the second quarter to 72 cents a share. In response, its stock is up 11% in pre-market. Why the celebration? Analysts expected Bank of America's earnings to tumble 48% to 53 cents, so it beat those expectations by 19 cents a share.

According to CNNMoney. Bank of America's revenue was up 14.6% to $20.32 billion during the quarter due to "wider net interest margins, loan growth and higher income from mortgage banking and the company's investment and brokerage services." Thomson Reuters surveyed analysts who expected revenue of $18.37 billion -- 10% lower than its actual results.

I am wondering whether some investors will think we have bottomed out of the banking crisis. I think it's too early to break out the champagne, but the coming rally could be a good time for nervous investors to bail out. That's because credit losses could keep rising -- Bank of America added $5.8 billion to reserves for bad loans and its Countrywide purchase could boost those reserves far more in coming quarters.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned.

Citigroup Inc. (NYSE:C) is expected to cut 15,000 jobs and take a $1 billion charge as part of a restructuring plan it will announce in the next few weeks, according to media reports.

The company, which is also looking at big acquisitions including Japan's Nikko Cordial and reportedly ABN AMRO, is due to announced first quarter results April 16, the day before its annual meeting. The Wall Street Journal (subscription required) is reporting that the company wants to unveil its restructuring plan before then.

Chief Executive Charles Prince has a big challenge. As the Journal points out, Prince can't cut too deeply because morale could suffer and if he's too conservative big shareholders will be angry. Citigroup also needs enough offices and people to meet its goal of boosting international revenue to 60 percent of total sales from about 44 percent, the paper said.

Citigroup. whose shares have underperformed its peers, is going in a million different directions at the same time.

How can the company go on an acquisition binge and undertake a restructuring at the same time? It doesn't make any sense.

This plan doesn't seem to address the concerns of Prince Alwaleed bin Talal, Citigroup's biggest individual share older who last year called for big cuts to expenses.

Something is going to have to give here.

Either Citigroup will have to cut a lot more jobs or give up on huge acquisitions for a while. Until the dust settles, shareholders are going to stay on the sidelines.