Bank of America (NYSE:BAC) posted profit that exceeded analysts’ expectations on strength in its sprawling retail arm.
The lender said Wednesday that it generated $7.3 billion in second-quarter profit, an 8% increase from a year earlier, or 74 cents a share, compared with the 71-cent estimate of analysts. It posted revenue of $23.2 billion, a 2.1% increase from a year earlier, matching analysts’ estimates.
Under CEO Brian Moynihan, the bank delivered record first-half profit, fueled by the company’s retail lending operations and Moynihan’s expense initiatives.
It was the 18th-straight quarter the company has managed to improve the firm’s operating leverage, meaning it has grown revenue while cutting or holding the line on costs.
"Our commitment to responsible growth resulted in the best quarter and first-half year of earnings in our company’s history," Moynihan said in the earnings release.
Profit in the firm’s biggest division, its consumer bank, rose 13% to $3.29 billion as revenue climbed 5% to $9.72 billion as it added deposits and loans, which led to higher net interest income. That was the strongest showing among the company’s four main businesses, followed by its wealth management division, where profit rose 11% to $1.07 billion.
Meanwhile, profit in its global markets division fell 7% to $1.07 billion amid a slowdown in trading activity across asset classes. Fixed income trading revenue dropped 8% to $2.13 billion, essentially matching estimates, while equities trading fell 13% to $1.15 billion, just below the $1.22 billion estimate.
Profit in its global banking division declined 9% to $1.93 billion on a drop in capital markets deals.
Shares were unchanged at Wednesday’s open at $26.60
