Bank of America Says Zelle Users Have Grown 24% YoY

Bank of America’s third-quarter earnings results showed a continued increase in customers using digital and mobile channels for their banking needs, while $1.1 billion in reserves released helped boost the bottom line.

Combined credit and debit card spend, the company said, was $201 billion in the most recent quarter, having gained 21% from last year. In a sign that green shoots in credit spending have proven durable, Bank of America said credit spending gained 26%, outpacing debit’s 17% growth.

Average deposits in the consumer banking division stood at $1 trillion, gaining ground from the $979 billion seen last year.

Management said on the call with analysts that the consumer segment’s rebound has accelerated, as net checking accounts have grown by more than 700,000 year to date. More than 90% of those are primary accounts with an average balance of more than $10,000.

Credit card net loss rate was 1.7%; pre-pandemic, that percentage was more than 3%, management noted.

In terms of headline numbers, the company’s 85 cents per share in earnings was better than the 71 cents expected by the Street, while revenues of $22.9 billion were above the consensus at $21.8 billion.

Digital Active Users Surge

Drilling into the company’s supplemental materials, Bank of America said that digital active users in the most recent quarter stood at 40.9 million, up 4% year on year. The company also said that total digital unit “sales” in the most recent period were 43% of total sales.

Erica, the virtual financial assistant on offer from the bank, had 22.9 million users, up from 15.9 million users in the previous year’s third quarter.

Zelle had 15.1 million users in the quarter, up 23.7% from 12.2 million users a year ago.

Digital wallet enrollment for commercial cards was up 13% as measured on a year-over-year basis, the company said.  Management stated that during the quarter, 70% of households had at least some digital engagement with the bank within the past 90 days, logging in more than 2.6 billion times.

“Digital engagement has become foundational to maintaining our customer satisfaction,” said CFO Paul Donofrio. That comes as clients are increasingly logging in to check balances and originate loans, among other activities.