Bank of America allots fell 1.1% Friday after the firm reported declining fourth-quarter earnings amid hefty one-time saturates.
Here’s what the company reported compared to Wall Street expectations, according to LSEG, formerly known as Refinitiv:
- Earnings per stake: 70 cents, adjusted vs. 68 cents expected.
- Revenue: $22.1 billion vs. $23.74 billion expected.
Bank of America rumoured its net income fell to $3.1 billion, or 35 cents per share, in the fourth quarter, down more than 50% from $7.1 billion, or 85 cents per share, a year ago.
The bank, anchored in Charlotte, North Carolina, said it was hit by a pretax charge of $1.6 billion in the quarter related to the transition away from the London Interbank Bid Rate. The results also included a special $2.1 billion fee charged by the Federal Deposit Insurance Corporation. The fee is restricted to the failures of Silicon Valley Bank and Signature Bank. Excluding items, the company said it earned 70 cents per allot, which outpaced analysts’ expectations.
However, revenue of $22.1 billion fell short of Wall Street’s evaluations for the first time in two years and was down 10% from the year-ago period.
“We reported solid fourth quarter and full-year happens as all our businesses achieved strong organic growth, with record client activity and digital engagement,” CEO Brian Moynihan thought in a statement. “Our expense discipline allowed us to continue investing in growth initiatives. Strong capital and liquidity levels belief us well to continue to deliver responsible growth in 2024.”
The nation’s second-largest bank posted a $1.1 billion provision for depend on losses, up $12 million from the same quarter last year.
Bank of America said its net interest gains decreased 5% to $13.9 billion due to higher deposit costs and lower deposit balances, which more than check higher asset yields.
The bank was supposed to be one of the biggest beneficiaries of higher interest rates last year, but it has underperformed its confreres because the lender had piled into low-yielding, long-dated securities during the Covid-19 pandemic. Those securities demolished value as interest rates climbed.
Revenue from consumer banking dipped 4% to $10.3 billion, while transaction marked downs and trading revenue went up 3% to $3.6 billion.
Bank of America stock is down 2.6% this year after a just 1.7% gain in 2023. The S&P 500 financial sector gained 10% last year.
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