Bank of America earned $20.436 billion in the first nine months of the year, 2.1% less than in the same period in 2018, although in the last quarter it outperformed expectations thanks to its consumer and advisory business.
The second U.S. bank by volume of assets announced in a statement that in the third quarter obtained a net profit of 5,777 million, 24.1% less than in the same period last year to include the charge of 2,100 million linked to the end of a partnership with First Data.
The entity said it obtained a net profit per share of $2.01 until September, compared to $1.91 a year ago.
The banking group invoiced 68,895 million in the first nine months of the year, about 1% more than in 2018, when it had entered 68,343 million.
The Charlotte-based entity (North Carolina) earned 56 cents per share – analysts expected 54 cents – compared to 66 cents then.
The group’s turnover rose between July and September to 22,807 million, a year-on-year decline of 0.4%.
But Bank of America has been cutting its expenses steadily while revenues are rising. That has made it a favorite title for Warren Buffett’s Berkshire Hathaway, which has asked the Federal Reserve for permission to take its stake beyond the 10% level, according to local media.
In the past, Bank of America benefited from a series of Federal Reserve interest rate increases, which began in late 2015. But now the Fed is moving in the opposite direction: it cut interest rates twice in the third quarter.
This has weighed on the bank’s lending business, whose net interest income was up 1% from last year and was stable from the previous quarter.
The bank’s chairman and chief executive officer, Brian Moynihan, highlighted “strong shareholder earnings” in a Bank of America note.
“In a moderate-growth economy, we have focused on managing what we can control. We invested heavily in our capabilities to serve customers, more management teams, more branch and office renovations, and more digital capabilities, all at the same time,” the CEO recalled.
Brian Moynihan believes that “the expansion of our customer base and our ability to gain market share in most of our businesses in the quarter reflect responsible growth” of the entity.
The bank’s profits were above analysts’ expectations and at the opening of Wall Street its shares rose by 3.25% on the New York stock exchange, as did the day before the rest of the country’s major banks.