BAC Bank of America Corporation

By Rachel Louise Ensign 

Bank of America Corp. said first-quarter profit rose as a healthy U.S. economy led to a strong performance in its massive consumer business.

Quarterly profit at the Charlotte, N.C.-based bank, the second largest in the U.S. by assets, was $7.31 billion, compared with $6.92 billion a year ago. Per share, earnings were 70 cents. Analysts polled by Refinitiv had expected 66 cents per share.

First-quarter revenue was $23 billion, roughly flat from $23.07 billion a year ago, the bank said Tuesday.

Profit rose 25% in the bank's consumer business due to higher interest rates, deposit and loan growth. It was also up in wealth management and global banking, though investment-banking revenue fell nearly 7% in the first quarter from a year earlier.

Three years of interest-rate increases have allowed banks to charge borrowers more without significantly increasing what they pay depositors, but that era may be coming to an end. The Federal Reserve in March opted to keep interest rates steady and indicated it was unlikely to raise them at all this year. Some have suggested the Fed could cut rates if economic conditions worsen.

Bank of America managed to keep a lid on interest-rate increases to customers. It paid 0.73% on U.S. interest-bearing deposits in the first quarter, compared with 0.63% in the fourth quarter.

Net interest income rose 5% from a year earlier but fell 1% from the prior quarter.

Loans at Bank of America grew 1% from a year earlier, while deposits were up 4% over that period. Expenses were down more than 4%.

Bank of America, like other big banks, felt the effects of quiet markets in the first quarter. Trading revenue fell 13%.

Write to Rachel Louise Ensign at rachel.ensign@wsj.com

(END) Dow Jones Newswires

April 16, 2019 07:55 ET (11:55 GMT)

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