HomeFinance NewsBofA's profit rises on higher interest rates, loan growth

BofA's profit rises on higher interest rates, loan growth

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By CNBC-TV18 April 16, 2018, 5:22:39 PM IST (Updated)

BofA's profit rises on higher interest rates, loan growth
Bank of America reported a 34% rise in first-quarter profit on Monday as it benefited from higher interest rates and loan growth.


The second-largest US bank by assets said net income attributable to shareholders rose to a record $6.49 billion in the three months ended March 31 from $4.84 billion a year earlier. Earnings per share rose to 62 cents from 45 cents.

Analysts on average had expected 59 cents per share, according to Thomson Reuters I/B/E/S. It was not immediately clear if the reported figures were comparable.

Total revenue, net of interest expense, rose about 4% to $23.28 billion.

In the bank's biggest business - consumer banking - revenue rose 9% to $9.03 billion, helped by strong deposit and loan growth.

"Strong client activity, coupled with a growing global economy and solid US consumer activity, led to record quarterly earnings," Chief Executive Brian Moynihan said in a statement.

Higher interest rates helped BofA charge more for loans while keeping deposit rates low. The lender relies heavily on higher interest rates to maximise profits as it has a large stock of deposits and rate-sensitive mortgage securities.

JP Morgan Chase & Co and Citigroup Inc last week also reported rise in quarterly profit, helped in part by higher interest rates.
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