Bank of America beats estimates on strong investment banking revenue
Bank of America reported third-quarter results on Wednesday that surpassed analysts’ expectations, driven by stronger-than-anticipated investment banking revenue.
The bank posted earnings per share of $1.06, exceeding the LSEG estimate of 95 cents. Revenue came in at $28.24 billion, above the projected $27.5 billion, News.Az reports, citing CNBC.
The second largest U.S. bank by assets said that profit rose 23% from a year earlier to $8.5 billion, or $1.06 per share. Revenue rose 10.8% to $28.24 billion.
Like its peers, Bank of America’s Wall Street businesses helped fuel the quarter’s results.
Banks including JPMorgan Chase and Goldman Sachs reported strong gains in trading and investment banking revenue on heightened activity among both institutional investors and corporations looking to acquire companies or raise capital.
Bank of America said investment banking fees surged 43% from a year earlier to $2 billion, about $380 million more than analysts surveyed by StreetAccount had expected.
Equities trading also contributed to the quarterly beat; revenue there rose 14% to $2.3 billion, roughly $200 million more than the StreetAccount estimate.
Fixed income trading rose 5% to $3.1 billion, matching expectations.
Bank of America also benefited from an improved outlook around credit losses in the quarter. The company said its provision for credit losses fell about 13% to $1.3 billion, which is below the $1.58 billion StreetAccount estimate.
Net interest income rose 9% to $15.39 billion, about $150 million more than the StreetAccount estimate.
“With continued organic growth, every line of business reported top and bottom-line improvements,” CEO Brian Moynihan said in the release. “Strong loan and deposit growth, coupled with effective balance sheet positioning, resulted in record net interest income.”
Shares of the bank have climbed roughly 14% this year before Wednesday.
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