Bank of America net income drops to $3.1 billion

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Bank of America net income drops to $3.1 billion
Credit: © Reuters.

NEW YORK - Bank of America Corporation (NYSE: BAC ) reported a significant drop in net income for the fourth quarter, with figures declining to $3.1 billion compared to $7.1 billion in the same period the previous year, primarily due to one-off charges amounting to $3.7 billion. Despite the initial stock price falling nearly 3% today, the adjusted earnings per share stood at 70 cents, marginally surpassing analysts' expectations.

The bank's executives remain optimistic about the future, projecting a recovery in net interest income (NII) later in the year, supported by strong loan growth observed in the last quarter. However, there has been a noticeable increase in consumer loan defaults, especially in credit card debt and office real estate loans, leading to a rise in net charge-offs.

On the brighter side, Bank of America's trading operations have seen a positive trend, with equities trading revenue jumping by 12%. This surge has contributed to an overall 1% increase in trading revenue, which now stands at $3.8 billion.

Additionally, the bank has experienced a 7% growth in investment banking fees, signaling a robust performance in this sector despite the broader income challenges faced this quarter.

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