Profits rose by double-digits percentage points at Bank of America in the first quarter of 2019, the firm said on Tuesday, underscored by a bustling consumer banking operation amid what its top executive called solid U.S. economic growth.
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Net income at the Charlotte, North Carolina-based company rose to $7.3 billion, or 70 cents per share, higher than Wall Street expectations. Revenue in the three months through March was $23 billion, slightly less than analyst estimates.
Overall, average deposits grew 5 percent to $1.4 trillion, while average loans rose 4 percent to $897 billion.
“Economic growth and consumer activity in the U.S. continue to be solid, businesses of every size are borrowing and driving the economy, and asset quality is strong,” CEO Brian Moynihan said.
On top of higher earnings in some of its key business segments, the firm also trimmed costs by 4 percent, or $500 million, in the three months through March.
Deposits in its consumer banking division grew 3 percent to $697 billion, spurring a 7 percent rise in revenue to $9.6 billion. Sector-wide, profits rose 25 percent to $3.2 billion. The increases helped offset losses in the investment banking division, which saw revenue drop slightly to $4.8 billion due to lower trading fees.
The company previously announced it would raise its minimum wage to $20 per hour. It is also adding 350 financial centers by 2021, according to Moynihan.
“Our network will provide coverage for more than 90 percent of the U.S. population,” he said in a statement.
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Moynihan faced pressure from Republican lawmakers earlier this month over the bank’s decision to restrict its activity with gun manufacturers.
"There’s a lot of Americans who you serve [that] would greatly disagree with that policy," Rep. Sean Duffy, R-Wis., said at a hearing in the House Financial Services Committee. "It might play well in the east coast, it might play well in California, [but] your bank is not the Bank of New York or California, it’s the Bank of America."
Bank of America is the latest bank to report earnings, after Goldman Sachs on Monday, along with Wells Fargo and JPMorgan Chase on Friday.