(New York) Bank of America doubled its net income in the first quarter thanks to the reduction in reserves set aside during the pandemic and the good health of its merchant banking business.
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The group posted a net profit of 7.6 billion dollars over the period, details a statement Thursday.
Reported per share and excluding exceptional items, the benchmark on Wall Street, it stands at 86 cents, more than the 66 cents expected by analysts.
Its turnover stabilized over one year at $ 22.8 billion. Here too, it is higher than expected.
Like all major banks, the establishment had set aside billions to deal with possible defaults from its customers.
But the bankruptcies having finally remained limited and the economic situation improving little by little, the bank decided to reduce a little the protective cushion it had built up and released $ 2.7 billion in reserves.
“We believe that progress on the health crisis front and on the economic front will fuel an acceleration of the recovery,” company CEO Brian Moynihan said in the statement.
Revenues from consumer and small business banking services fell 12% due in part to low interest rates, which eat away at the money the bank can make by lending to its customers.
Bank of America has also seen customers pay off credit card debts faster, reducing total loan amounts by 8%, and putting more money into their checking accounts.
Many individuals were supported by government aid and, in the face of the restrictions, generally spent less.
Bank of America also benefited from the risk appetite of companies and investors as, thanks to the policies of the US central bank, money poured into the markets.
The fees collected for its advisory services to large companies in mergers and acquisitions or fundraising transactions in the markets jumped 62% to a record high.
Income from the brokerage of stocks, commodities, currencies and other financial assets increased 11%.
Bank of America stock was up 1.2% in electronic trading leading up to the opening of the session.
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