Bank of America released its latest quarterly earnings results before opening bell this morning. The bank posted earnings of 41 cents per share on $21.6 billion in revenue, representing a 3% year over year increase, against the consensus estimates of 34 cents per share in earnings and $20.97 billion in revenue. In last year’s third quarter, the bank reported 38 cents per share in earnings.
Bank of America posts strong growth
Bank of America’s net interest income grew 3% to $10.2 billion on a GAAP basis; noninterest income also grew 3% to $11.4 billion. In the Consumer Banking division, Bank of America added $16.1 billion in loan and $60.4 billion in deposits. Brokerage assets grew 18%. The Global Wealth and Investment Management segment had almost $2.5 trillion in total client balances, while loans grew $9.2 billion and deposits increased $6.8 billion.
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Loans in the Global Banking division grew $20.5 billion, while deposits increased $3.4 billion. Bank of America’s Global Markets business recorded a 14% increase in sales and trading revenue and a 32% increase in fixed income. Equities declined 17% in what was a tumultuous third quarter for the stock market.
“Strong client activity and good expense discipline combined to drive positive operating leverage as we continue to optimize and strengthen our balance sheet,” said Chief Financial Officer Paul Donofrio in a statement. “With near-record levels of capital and liquidity, as well as robust underwriting standards, Bank of America is stronger, safer and better prepared to deliver for customers and clients than probably at any time in our history. We remain focused on delivering long-term value to shareholders.”
Bank of America improves capital ratios
The bank’s book value per share improved 8% to $24.19, while its tangible book value per share grew 11% to $17.14 billion. Bank of America’s Common Equity Tier 1 ratio transition stood at 11% at the end of September, up from 10.6% at the end of the second quarter. On a fully phased-in basis, the Common Equity Tier 1 ratio improved to 10.9% at the end of September from 10.5% at the end of June.
Bank of America shares rose by as much as 1.69% to $16.27 in premarket trading following this morning’s results