Bank of America posts Q1 rise

Bank of America reported higher first-quarter profit on April 15, beating Wall Street estimates as trading, investment banking and interest income all rose. (newsroom.bankofamerica.com) The bank said net income increased to $8.6 billion, from $7.4 billion a year earlier, and diluted earnings per share rose to $1.11 from $0.89. Revenue, net of interest expense, climbed 7% to $30.3 billion. (bankofamerica.com) Chief executive Brian Moynihan said the quarter showed “healthy client activity,” including solid consumer spending and stable asset quality, while adding that the bank remains “watchful of evolving risks.” Net interest income rose 9% to $15.7 billion. (bankofamerica.com) The results arrived one day after several large United States banks posted stronger first-quarter numbers, helped by volatile markets and a pickup in dealmaking. Bank of America’s equities trading revenue rose 17% to a record $2.2 billion, and investment banking fees increased 8% to $1.5 billion. (cnbc.com) That mix matters for Bank of America because the bank has spent the past two years trying to grow beyond plain-vanilla lending, which depends heavily on interest rates. In the first quarter, sales and trading revenue rose 11% to $5.7 billion, giving the bank another source of growth while the Federal Reserve’s rate path remains uncertain. (bankofamerica.com) The consumer side also held up. Average consumer deposits were $951 billion, credit and debit card spending rose 4% to $228 billion, and Moynihan said charge-offs and delinquency rates were still below pre-pandemic levels. (bankofamerica.com) Investors have been watching whether higher borrowing costs would crack household finances or force banks to set aside sharply more money for bad loans. Bank of America reported provision for credit losses of $1.5 billion, up from $1.3 billion a year earlier, while saying commercial reservable criticized exposure fell 12% from the fourth quarter. (bankofamerica.com) The bank also pointed to balance-sheet strength as regulators keep pressing large lenders on capital. Its common equity tier 1 ratio, a key capital buffer, was 11.8% at March 31, above the current regulatory minimum of 10.7%. (bankofamerica.com) Bank of America shares rose 1.6% in early trading after the report, according to Reuters. For now, the bank’s message was that consumers are still spending, markets are still active, and management is still bracing for a rougher turn if conditions change. (usnews.com)