BofA profit rises on higher rates, lower

Gulf News - - INTERNATIONAL -

Bank of Amer­ica Corp, the sec­ond-largest US bank by as­sets, re­ported a 15 per cent rise in quar­terly profit as the lender kept a tight leash on costs and ben­e­fited from higher in­ter­est rates.

BofA’s shares rose about 1 per cent in pre­mar­ket trade.

The bank’s net in­come at­trib­ut­able to com­mon share­hold­ers rose to $5.12 bil­lion (Dh18.8 bil­lion) for third quar­ter ended Septem­ber 30 from $4.45 bil­lion in the year-ago pe­riod. Earn­ings per share rose to 48 cents from 41 cents. An­a­lysts on av­er­age had ex­pected earn­ings of 45 cents per share, ac­cord­ing to Thom­son Reuters. It was not im­me­di­ately clear if the re­ported re­sults were com­pa­ra­ble.

Ben­e­fit­ing from higher Fed­eral Re­serve in­ter­est rates, the lender’s net in­ter­est in­come rose 9.4 per cent to $11.16 bil­lion.

The Fed is widely ex­pected to raise rates again in De­cem­ber.

BofA’s large stock of de­posits and rate-sen­si­tive mort­gage se­cu­ri­ties make the lender par­tic­u­larly de­pen­dent on a rise in in­ter­est rates to boost prof­its.

Trad­ing rev­enue fell 15 per cent, with rev­enue from fixed in­come trad­ing down 22 per cent.

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