Bank of America (NYSE:BAC) stock climbed 4.8% in Wednesday premarket trading after the bank’s earnings beat the consensus estimate by a wide margin, as every line of business demonstrated top- and bottom-line improvement, the company said.
Bank of America (NYSE:BAC) expects Q4 net interest income on fully taxable equivalent basis of $1.56B-$1.57B (vs. Visible Alpha consensus of $15.6B), lifting the lower end of the range slightly from its previous guidance of $15.5B-$15.7B.
Q3 EPS of $1.06, beating the average analyst estimate of $0.95, rose/fell from $0.89 in Q2 and $0.81 in last year’s Q3.
Net interest income (FTE basis) of $15.4B, topping the $15.2B Visible Alpha estimate, increased from $14.8B in the prior quarter and $14.1B a year ago.
“Strong loan and deposit growth, coupled with effective balance sheet positioning, resulted in record net interest income. We also saw strong fee performance from our market-facing businesses,” Chairman and CEO Brian Moynihan said. “As revenues grew at a much faster rate than expenses, we drove good operating leverage and an efficiency ratio below 62%.”
Noninterest income of $12.9B, vs. the $12.3B Visible Alpha consensus, climbed from $11.8B in the prior quarter and $11.4B a year ago.
Q3 provision for credit losses fell to $1.30B from $1.59B in Q2 and $1.54B in last year’s Q3.
Q3 noninterest expense of $17.3B edged up from $17.2B in the previous quarter and rose from $16.5B a year ago.
Bank of America’s (NYSE:BAC) return on average tangible common shareholders’ equity was 15.4% vs. 13.4% in the previous quarter and 12.8% a year ago.
Average deposits totaled $1.99T, up from $1.97T in Q2.
Average loans of $1.15T climbed from $1.13T in the prior quarter.
Consumer Banking revenue of $11.2B increased from $10.8B in Q2 and $10.4B in last year’s Q3. Average deposits fell to $947.4B from $952.0B in Q2. Combined credit/debit card spending of $245B rose 6% Y/Y.
Global Wealth and Investment Management revenue of $6.31B climbed from $5.94B in the prior quarter and $5.76B a year ago. Net income of $1.27B vs. $993M in Q2 and $1.06B in Q3 2024. Client balances of $4.64T grew 11% Y/Y, driven by higher market valuations and positive net client flows.
Global Banking revenue of $6.25B vs. $5.69B in the prior quarter and $5.83B a year ago. Net income of $2.13B increased from $1.70B in Q2 and $1.90B in last year’s Q3. Average deposits of $631.6B increased 15% Y/Y and average loans and leases of $388.5B B rose by 5%.
Global Markets revenue (ex-net DVA) of $6.21B grew from $6.03B in Q2 and $5.64B in Q3 2024. Net income (ex-DVA) was $1.64B vs. $1.57B in the prior quarter and $1.55B a year ago. Sales and trading revenue, excluding net DVA, of $5.3B rose 8% Y/Y.
Conference call at 8:30 AM ET.
Earlier, Bank of America GAAP EPS of $1.06 beats by $0.11, revenue of $28.09B beats by $630M