{"id":27065,"date":"2017-04-18T12:55:19","date_gmt":"2017-04-18T12:55:19","guid":{"rendered":"http:\/\/www.biphoo.com\/bipnews\/?p=27065"},"modified":"2017-04-18T13:00:54","modified_gmt":"2017-04-18T13:00:54","slug":"bofas-profit-boosted-by-surge-in-trading-investment-banking","status":"publish","type":"post","link":"https:\/\/www.biphoo.com\/bipnews\/business\/bofas-profit-boosted-by-surge-in-trading-investment-banking.html","title":{"rendered":"BofA’s profit boosted by surge in trading, investment banking"},"content":{"rendered":"

\n\tBofA's profit boosted by surge in trading, investment banking<\/strong><\/span><\/span>
\n<\/h2>\n

\n\tBank of America (BAC.N) reported a higher-than-expected jump in quarterly profit as bond trading surged and the lender earned more<\/span><\/span>\n<\/p>\n

\n\tfrom advising on debt and equity offerings and deals.<\/span><\/span>\n<\/p>\n

\n\tWall Street banks have been vitalized by increased market activity prompted by the so-called "Trump trade". Investors also changed<\/span><\/span>\n<\/p>\n

\n\ttheir positions around the Brexit vote and the Federal Reserve's interest rate hikes, boosting trading revenue for the big U.S. banks.<\/span><\/span>\n<\/p>\n

\n\tCustomers also borrowed more as the economy expanded, though the pace of loan growth has slackened somewhat recently.<\/span><\/span>\n<\/p>\n

\n\t"We saw good client activity in our balanced portfolio of businesses … The U.S. economy continues to show consumer and business<\/span><\/span>\n<\/p>\n

\n\toptimism, and our results reflect that," BofA Chief Executive Brian Moynihan said in a statement.<\/span><\/span>\n<\/p>\n

\n\tThe second-largest U.S. bank's total revenue rose about 7 percent to $22.45 billion in the three months ended March 31, handily<\/span><\/span>\n<\/p>\n

\n\tbeating the average analyst estimate of $21.61 billion.<\/span><\/span>\n<\/p>\n

\n\tRevenue from BofA's trading activities, excluding special items, rose 21.2 percent to $4 billion, helped by a 29 percent increase in<\/span><\/span>\n<\/p>\n

\n\tfixed-income trading revenue.<\/span><\/span>\n<\/p>\n

\n\tJPMorgan Chase & Co (JPM.N) and Citigroup Inc (C.N) last week also reported better-than-expected quarterly profit, driven by strong<\/span><\/span>\n<\/p>\n

\n\ttrading activity.<\/span><\/span>\n<\/p>\n

\n\tBofA's shares, which have risen about 34 percent since the presidential election on Nov. 8, were up 1.4 percent at $23.13 in<\/span><\/span>\n<\/p>\n

\n\tpremarket trading on Tuesday.<\/span><\/span>\n<\/p>\n

\n\tThe bank's investment banking income jumped 37.4 percent to $1.58 billion, riding on the back of a strong recovery in global<\/span><\/span>\n<\/p>\n

\n\tinvestment banking services, which includes M&A advisory and capital markets underwriting.<\/span><\/span>\n<\/p>\n

\n\tNet income rose about 44 percent to $4.35 billion. Earnings per share rose to 41 cents per share, topping the average analyst<\/span><\/span>\n<\/p>\n

\n\testimate of 35 cents per share. (bit.ly\/2px3E6G)<\/span><\/span>\n<\/p>\n

\n\tHigher interest rates increased the amount of money banks can earn from their various loans, known as net interest income. BofA<\/span><\/span>\n<\/p>\n

\n\tmade $11.06 billion as net interest income in the quarter, up 5.5 percent from a year earlier.<\/span><\/span>\n<\/p>\n

\n\tThe lender relies heavily on higher interest rates to maximize profits as it has a large stock of deposits and rate-sensitive mortgage<\/span><\/span>\n<\/p>\n

\n\tsecurities.<\/span><\/span>\n<\/p>\n

\n\tThe lender's non-interest expenses was nearly flat at $14.85 million.<\/span><\/span>\n<\/p>\n

\n\tMoynihan said last year he would make trimming costs a top priority and would shrink annual expenses by about an additional $5 billion<\/span><\/span>\n<\/p>\n

\n\tby 2018.<\/span><\/span><\/p>\n

\n\t\t\t
\n\t\t\t <\/div><\/div>\n\t\t