Bank of America (NYSE: BAC) stock fell over 3% in intraday trading Tuesday following the release of first-quarter financial results.
Bank of America (BAC) recently reported its first-quarter results, beating analysts’ estimates and outperforming its peers in key profitability metrics, including net interest income.
The United States’ second-largest bank reported an adjusted net income of $7.20B, or 83 cents per share for the first quarter. This figure has outperformed analysts’ estimates of 76 cents, according to LSEG. Revenue, net of interest expenses, saw a slight decline of 2%, amounting to $25.80B.
The bank revealed a profit decrease of 18% to $6.67B, or 76 cents per share. Excluding a $700M FDIC assessment, profit stood at 83 cents per share. Meanwhile, revenue slipped by 1.6% to $25.98B, primarily due to a decrease in net interest income compared to the previous year.
Net interest income, which represents the difference between the income generated from loans and investments and the interest paid to customers for their deposits, amounted to $14.19B, surpassing the StreetAccount estimate of $13.93B. This achievement stands in contrast to rivals such as JPMorgan Chase (JPM) and Wells Fargo (WFC), whose NII fell short of expectations last week.
Bank of America’s total deposits increased by around 1% to $1.95T from the fourth quarter, while loans remained relatively stable at $1.05T.
In a conference call with analysts on Tuesday, Bank of America CFO Alastair Borthwick indicated that the bank anticipates net interest income to decline in the second quarter to around $14 billion due to decreases in wealth management and market interest income. However, he expressed optimism that it could rebound in the second half of the year.
NII has experienced a downward trend in recent quarters due to rising funding costs amid increases in interest rates.
Bank of America (NYSE: BAC) Stock Movement
At the time of publication, BAC stock has dropped 3.53% compared to the previous trading session, trading at $34.68. The traders have exchanged hands with 95,566,096 (95.56 million) shares versus the average daily trading volume of 40.33 million.
Edward Cooke is a financial analyst, freelance writer, and editor. He has six years of experience in financial journalism. He has an in-depth understanding of equities markets, tracking major indices and providing real-time analysis on stock price movements, corporate earnings, and market sentiment.
