Bank of America: Q2 profit up 27% to $9.1 billion, beating forecasts; revenue up 15.3%

(Il Sole 24 Ore Radiocor) - In the second quarter, Bank of America saw its profits rise (+27 per cent) and revenues increase (+15.3 per cent), thanks to strong performance in investment management, markets and global banking. In the three months to June, the Charlotte-based bank reported a net profit of $9.1 billion, or $1.21 per share, compared with $7.2 billion, or $0.90 per share, in the same period last year, and above the consensus estimate of $1.12. Revenue rose to $31.6 billion from $27.4 billion, again exceeding the forecast of $30.77 billion, thanks to an increase in net interest income (+9% to $16 billion), sales and trading revenue, and improved fees from wealth management and investment banking. Deposits grew by more than 2 per cent to $2,020 billion and loans by 8 per cent to $1,220 billion. Looking at capital ratios, the CET1 ratio stood at 11.2 per cent, above the minimum required by the regulatory authorities. Book value rose by 7 per cent to $39.34 per share. “We have delivered one of our best quarters ever, with every business segment reporting double-digit earnings growth and strong returns on capital,” said the CEO, Brian Moynihan, emphasising that “it was an exceptional quarter for our market-facing businesses, with investment banking fees up 50 per cent year-on-year. In the short term, the order book remains solid and corporate lending is recovering”. Disciplined cost management, combined with investments in growth, “helped generate an operating leverage of 6.6 per cent and an improvement of around 360 basis points in our efficiency ratio compared with a year ago”.
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