Brian Moynihan, CEO of Bank of America Corp., during a Senate Banking, Housing and Urban Affairs Committee hearing in Washington, D.C., Sept. 22, 2022.
Al Drago | Bloomberg | Getty Images
Bank of America on Tuesday posted second quarter profit and revenue that edged out expectations as the company reaped more interest income amid higher interest rates.
Here’s what the company reported:
- Earnings: 88 cents a share, vs. 84 cents a share Refinitiv estimate
- Revenue: $25.33 billion, vs. expected $25.05 billion
The bank said earnings rose 19% to $7.4 billion, or 88 cents a share, from a year earlier. Revenue climbed 11% to $25.33 billion, fueled by a 14% jump in net interest income to $14.2 billion, essentially matching the expectation of analysts surveyed by FactSet.
“We continue to see a healthy U.S. economy that is growing at a slower pace, with a resilient job market,” CEO Brian Moynihan said in the release. “Continued organic client growth and client activity across our businesses complemented beneficial impacts of higher interest rates.”
Bank of America was expected to be one of the top beneficiaries of rising interest rates this year, but it hasn’t played out that way. The company’s net interest income, one of the main drivers of a bank’s revenue, has been questioned lately as loan and deposit growth has slowed. Last week, rival JPMorgan Chase posted a far stronger jump in net interest income that helped fuel a 67% surge in quarterly profit.
Bank of America shares have declined about 11% this year before Tuesday, compared with the approximately 20% decline of the KBW Bank Index.
This month, the Consumer Financial Protection Bureau said it fined the Charlotte, North Carolina-based bank for customer abuses including fake accounts and bogus fees. Analysts may ask CEO Brian Moynihan if the problems have been resolved.
On Friday, JPMorgan, Citigroup and Wells Fargo each posted earnings that topped analysts’ expectations amid higher interest rates. Morgan Stanley is scheduled to release results later Tuesday, and Goldman Sachs wraps up big bank earnings Wednesday.
This story is developing. Please check back for updates.