Bank of America released higher-than-expected third-quarter accounts. Both Profits and Revenues have exceeded expectations on fixed income trading.
According to the press release published by Bank of America, third-quarter profit fell 8% to $ 7.1 billion, or 81 cents per share, due to the provision of $ 898 million for possible non-performing loans. . Revenue after interest expense jumped to $ 24.61 billion on a non-GAAP basis.
The stock rises 3% in pre-market trading.
The bank led by CEO Brian Moynihan was supposed to be a major beneficiary of the Federal Reserve’s rate policy.
Lenders including Bank of America, JPMorgan Chase, and Wells Fargo are generating more revenue as rates rise, enabling them to generate more profits from their core deposit-taking and lending businesses.
“Our US clients remained resilient with strong, albeit slower growing, spending levels and still maintained high deposit amounts,” Moynihan said in the statement.
“We have increased loans by 12% in the last year as we have provided the financial resources to support our customers.”
The bank’s interest margin jumped 24% to $ 13.87 billion in the third quarter, surpassing StreetAccount’s $ 13.6 billion estimate, thanks to higher rates in the quarter and an expanding loan portfolio.
Net interest margin, a key profitability metric for banking investors, rose to 2.06% from 1.86% in the second quarter of this year, surpassing analysts’ estimate of 2%.
Fixed income trading revenues increased 27% to $ 2.6 billion, far exceeding the $ 2.24 billion estimate. Fixed income revenues offset equity income which fell 4% to $ 1.5 billion, below the estimate of $ 1.61 billion.