It?s an improvement over last year, but not enough of a rebound for Wall Street: Bank of America reported first quarter earnings results Wednesday morning, and while the bank?s profit compared favorably to the $276 million net loss reported one year ago, the rebound wasn?t enough to match the Street?s expectations. BofA?s results fell short of the analyst consensus on both the top and bottom line, and as a result, shares of its stock have slipped into negative territory in early Wednesday trading.
Bank of America reported $21.4 billion in first quarter revenue, down 5.9% over the prior-year period and just missing the $21.5 billion Wall Street estimate. Net income for the quarter came in at $3.36 billion ? up sharply from the $276 million net loss that was driven by $6 billion in litigation expenses one year ago ? and resulted in earnings of 27 cents per share, up from a 5-cent per-share loss in the year-ago quarter. The analyst consensus, however, was calling for a per-share profit of 29 cents.
Bank executives attributed the quarter?s improvement to expense control, with CFO Bruce Thompson noting in the earnings release, ?We improved our liquidity, accreted capital and tightly managed expenses in a challenging interest rate environment.?
Speaking on the results as a whole, CEO Brian Moynihan said Wednesday morning, ?Continuing the trend from last quarter, we saw core loan and deposit growth, higher mortgage originations, and increased wealth management client balances.? He went on to add: ?We see continued encouraging signs in customer and client activity, with consumer spending increasing and utilization of credit by our commercial customers rising. This should bode well for the near-term economic outlook.?
The results from BofA?s individual business segments were a mixed bag: while revenue fell within most divisions, several were able to grow their profit. Consumer banking recorded $7.5 billion in revenue, down 3% year-over-year; net income grew marginally to $1.48 billion (from $1.47 billion). The segment originated $13.7 billion in first-lien residential mortgage loans and $3.2 billion in home equity loans during the quarter, up from $11.6 billion and $3.4 billion (respectively) in the fourth quarter of 2014 and $8.9 billion and $2 billion in the prior-year period.
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