Bank of America (NYSE:BAC) reported third-quarter fiscal 2025 financial results on Wednesday, and its stock gained after the report.
The bank reported a net income of $8.5 billion (up from $6.9 billion a year ago) and EPS of $1.06, beating the analyst consensus estimate of $0.94.
Revenue, net of interest expense, increased 11% year-over-year (Y/Y) to $28.24 billion, beating the analyst consensus estimate of $27.50 billion.
Net Income
The Consumer Banking segment reported a net income of $3.44 billion, compared to $2.69 billion year-over-year. Global Wealth and Investment Management generated $1.27 billion, up from $1.06 billion year-over-year. Global Banking achieved $2.13 billion, compared to $1.9 billion year-over-year. Global Markets recorded $1.64 billion, up from $1.55 billion year-over-year.
Also Read: Is The Market Missing Bank Of America’s Strong Earnings Growth?
Net interest income was $15.2 billion (up 9% Y/Y), driven by higher NII related to Global Markets activity, fixed-rate asset repricing, and higher deposit and loan balances, partially offset by the impact of lower interest rates.
Noninterest income was $12.9 billion (+13% Y/Y). Provision for credit losses declined 16% Y/Y to $1.3 billion.
The Investment Banking fees rose 43% to $2.0 billion.
The efficiency ratio for the quarter was 61.39%, compared to 64.64% Y/Y. The bank reported a Common Equity Tier 1 (CET1) ratio of 11.6%, compared to 11.8% a year ago. The book value per share of $37.95 improved by 7%.
The average loan and lease balance was $1.15 trillion (+9% Y/Y). Average deposits are up 4% Y/Y to $1.99 trillion, marking the ninth consecutive quarter of sequential growth.
The tangible book value per share of common stock was $28.39, up from $27.71 in the last quarter.
It paid $2.1 billion in dividends and repurchased $5.3 billion of stock.
Chair and CEO Brian Moynihan noted that revenue increased by 11%, while robust loan and deposit growth, along with effective balance sheet management, drove record net interest income.
Market-facing businesses delivered strong fee performance, and revenue growth outpaced expenses, achieving operating leverage and an efficiency ratio of less than 62%.
Outlook
In the fourth quarter, Bank of America expects a net interest income of $15.6 billion to $15.7 billion, up roughly 8% Y/Y.
Price Action: BAC stock is trading higher by 4.49% to $52.34 premarket at last check on Wednesday.
Read Next:
Photo by Veroniksha via Shutterstock
