Bank of America trumps estimates despite drop in profits
Bank of America’s profits slumped almost 20 per cent in the third quarter of this year, but its shares rose on a better-than-expected performance.
The lending giant’s share price climbed almost two per cent in premarket trading after three of the firm’s four main divisions posted a rise in revenue.
Read more: Banks struggle with PPI claims after deadline surge
Quarterly profit at the second largest US bank by assets tumbled from $7.17bn (£5.6bn) to £5.78bn year-on-year.
However, the drop in profits was driven by a one-time $2.1bn charge from the end of a partnership with First Data.
Net income excluding an impairment charge rose four per cent to $7.5bn.
Boss Brian Moynihan said: “In a moderately growing economy, we focused on driving those things that are controllable.”
The firm also reported a six per cent rise in average loans and leases from businesses.
The slight rise in profits, excluding the impairment charge, comes despite mounting concerns over the recent fall in interest rates.
Read more: African bank confirms plans to list in London
Bank of America, which is one of the most exposed US banks to changes in interest rates, has been hit by the Federal Reserve’s recent interest rate cuts.