Trending News

Blog Post


Bank of America profit beats on strength across businesses By Reuters 

© Reuters. FILE PHOTO: A Bank of America logo is pictured in the Manhattan borough of New York City, New York, U.S., January 30, 2019. REUTERS/Carlo Allegri

By Elizabeth Dilts Marshall and Niket Nishant

(Reuters) -Bank of America Corp beat estimates for third-quarter profit on Thursday, boosted by strong growth across its businesses which executives said they expected to continue next quarter.

Growth in loans and leases, higher spending on credit and debit cards, and strong equity-trading and M&A activity helped the bank record a 64% rise in earnings.

Net interest income (NII), which measures how profitably a bank can lend out depositors’ funds, rose nearly 10% to $11.09 billion. Bank of America (NYSE:)’s NII hit a low in the third quarter last year, but executives said they were optimistic it would continue to rise this year and next.

“We are expecting modest NII growth from the third quarter to the fourth quarter,” the bank’s Chief Financial Officer Paul Donofrio said. “(It) is going to depend on loan-to-deposit growth, and we expect both of those to continue to grow, consistent with a growing economy.

“One could expect, I think, robust improvement in NII in … the full year 2021 versus the full year 2022.”

Average loans and leases, excluding those from the government-backed Paycheck Protection Program (PPP), grew by 2.3% in the third quarter from the prior quarter, although that figure fell 4.3% from last year.

Still, nearly every loan product grew some in the quarter, and the bank issued around 1 million more credit cards, further fueling that growth.

“We had loan growth in every loan product at the company. It was very broad based,” “We are optimistic about future growth.”

BofA shares were up nearly 2.5% in mid-morning trading.

Combined spending on credit and debit cards was up 21% to $201 billion in the quarter, the bank said.

Revenue from its equities division rose 33%, driven by growth in client financing activities and strong trading performance.

The second-largest U.S. bank by assets released reserves of $1.1 billion in the quarter. It had set aside tens of billions of dollars last year to cover possible loan defaults, which it has steadily been releasing as the economic outlook improves.

Bank of America’s revenue jumped 12% to $22.8 billion.

Net income applicable to common shareholders rose to $7.26 billion, or 85 cents per share, for the quarter ended Sept. 30 from $4.44 billion, or 51 cents per share, a year earlier.

Analysts on average had expected a profit of 71 cents per share, according to the IBES estimate from Refinitiv.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Source link

Related posts

Leave a Reply

Required fields are marked *