Bank of America Profits Drop Less Than Expected

Bank of America’s first-quarter profit fell less than anticipated, with a drop in international deal-making offset by robust consumer lending.

As Reuters reported Monday (April 18), Bank of America showed a 9% increase in revenue for consumer banking revenue, which reached $8.8 billion for the quarter.

Read more: Wells Fargo Posts Declines in Revenue, Home Lending

“First-quarter results were strong despite challenging markets and volatility,” Chief Financial Officer Alastair Borthwick said in a statement.

“Net interest income increased by $1.4 billion versus the year-ago quarter supported by strong loan and deposit growth. Going forward, and with the forward curve expectation of rising interest rates, we anticipate realizing more of the benefit of our deposit franchise.”

Meanwhile, the bank saw its total investment banking fees drop to $1.5 billion — a 35% fall – during the quarter, while its global banking business, showed $165 million of provisions for credit losses, chiefly because it built reserves tied to its exposure to Russia and a rise in loans.

“With very minor direct exposure to Russia-based companies, our teams were able to assist clients and navigate through the complexities of the sanctions,” Borthwick said.

Reuters notes that Bank of America’s balance sheet is composed in such a way that it is the most sensitive of the big U.S. banks to interest rate changes, and is thus expected to benefit when interest rates climb.

See also: US Banks Expect Q1 Earnings Dip as Ukraine Conflict Chills Investment

Last week saw Wells Fargo release its first-quarter earnings report, showing a drop in revenue — a 20% reduction in profit from last year — and a 33% decline in home lending. Other big banks — JPMorgan Chase, Citigroup, Goldman Sachs and Morgan Stanley — posted profit declines as well.

Earlier this month, Refinitiv I/B/E/S, the global provider of financial markets data, projected that net income for the six largest U.S. banks will dip by more than a third versus 2021.