Bank of America posts profit as loan-loss provisions dropWednesday 16 October 2013 18.48
Bank of America today reported a third-quarter profit of $2.22 billion, compared with a loss a year earlier, as provisions for credit losses and expenses fell.
The second-largest bank in the US earned 20 cents per share in the three months to September 30, beating the average analyst estimate of 18 cents, according to Thomson Reuters.
The bank had recorded a net loss attributable to common shareholders of $33m due to accounting adjustments, litigation expenses and tax charges the same time last year.
Total revenue fell marginally to $22.19 billion in the latest quarter from $22.53 billion a year earlier, excluding accounting adjustments.
The bank said its provisions for loan losses fell 83% to $296m as credit conditions improved, while operating expenses dropped to $16.39 billion from $17.54 billion.
Sales and trading revenue for the bank's fixed income, currency and commodities business, excluding an accounting adjustment, fell by $501m to $2 billion, due to lower bond-trading volumes for much of the quarter.
Fixed-income traders were inactive for several weeks leading up to the Federal Reserve’s meeting in mid-September in the expectation that the Fed would announce a winding down of its stimulatory bond-buying programme.
"This quarter, we saw good loan growth, improved credit quality and record deposit balances," chief executive Brian Moynihan said in a statement.
Bank of America's shares have risen about 23% this year. The bank sold its remaining stake in China Construction Bank for $1.47 billion in September, contributing $750m pre-tax to its bottom line.