Bank of America reported that its earnings and revenue exceeded analysts' expectations. The bank reported stronger-than-expected interest income. Brian Moynihan, CEO, pointed out that consumer spending had continued to decelerate.
Bank of America reported better-than-expected results for its third quarter on Tuesday, with a 10% increase in profit and higher-than-anticipated interest income. Earnings per share for the quarter were 90 cents, versus LSEG's estimated 82 cents, while revenue was reported at a healthy $25.32 billion, surpassing the anticipated $25.14 billion. CEO Brian Moynihan noted that, despite an economic slowdown, the bank was still able to acquire new customers, with consumer banking deposits down 8% but still posting a revenue increase of 6%.
The company had anticipated a higher yield from interest rates this year, but instead found its stock to be the worst performer among its peers in the wake of their investments into low-yielding, long-term securities during the Covid pandemic, resulting in $100 billion in paper losses on bonds. Net interest income (NII) is predicted to reach $57 billion in 2023, though the situation remains uncertain.
Prior to Tuesday, JPMorgan, Wells Fargo, and Citigroup had all reported better-than-anticipated profits for the same period, aided by lower credit costs. Morgan Stanley is set to release their results on Wednesday. Bank of America's stock rose 1% in pre-market trading while its rivals have seen a 10% gain. Further updates are expected.
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