Bank of America
Bank of America (BAC) – Bank of America Corp on Monday reported second-quarter results that fell short of expectations, as a drop in investment banking outpaced solid net interest income.
Bank of America said earnings per share for the three months ended June were 73 cents, down 2.7 percent from a year earlier and 7 cents below the Wall Street consensus forecast of 80 cents per share. Net income of $6.2 billion
Consolidated revenue rose 6% from a year earlier to $22.7 billion, roughly in line with analysts’ expectations, as net interest income, a key measure of bank earnings, rose 22% to $12.4 billion and the Federal Reserve’s rate hikes expanded, the bank said. Investment banking fees fell 47% due to a decline in global business execution.
“Our strong organic growth engines are again reflected in new checking, consumer investing and small business account openings, as well as net new Merrill Lynch and private banking households and new commercial banking customers,” CEO Brian Moyney Brian Moynihan said. “This solid client activity in our business, coupled with higher interest rates, drove strong net interest income growth and enabled us to perform well in a weak capital market environment.
“We grew revenue 6% and achieved operating leverage for the fourth consecutive quarter. Our U.S. retail customers remained resilient due to continued strength in deposits and spending,” he added. “Credits across our franchises continue to grow, and our markets team helps clients navigate significant volatility reflecting economic uncertainty.
Shares of Bank of America fell 1.3% in premarket trading after the results, opening at $31.83.
Bank earnings last week as JPM – Get JP Morgan Chase & Co. reported second-quarter earnings fell 27% to $8.6 billion, missing Wall Street’s forecasts and set aside $1.1 billion in reserves Start shaking. Recovering bad loans and loan losses is partly related to a “deteriorating” economic outlook.
JPMorgan Chief Executive Jamie Dimon said geopolitical tensions, high inflation, declining consumer confidence, interest rate uncertainty and the war in Ukraine “are likely to adversely affect the global economy at some point.”
However, Citigroup C posted one of its best earnings gains in more than a decade on Friday after sales hit $19.64 billion.
The bank also offered $375 million to cover potential bad loan losses, a much smaller amount than rivals Wells Fargo & Company (WFC) – Get Wells Fargo & Company Report and JPMorgan Chase & Co.