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The
bank reported a 7% rise in investment banking fees to $1.2
billion. That contrasts with peers whose earnings suffered from
a dealmaking drought that has persisted for months.
Some industry executives held out hope, saying they had seen
early signs of recovery in parts of those businesses.
JPMorgan Chase's chief financial officer, Jeremy Barnum,
highlighted "green shoots" in trading and investment banking in
the bank's earnings last week, but said it was too early to call
a trend.
BofA shares rose nearly 1% in premarket trading after the
results. The stock is down more than 11% so far this year,
through the previous close.
The lender, alongside rivals JPMorgan Chase and Wells Fargo,
earned a windfall from charging clients higher interest rates as
the Federal Reserve raised borrowing costs to rein in stubborn
inflation. BofA's net interest income (NII) rose 14% to $14.2
billion in the second quarter. "We continue to see a healthy
U.S. economy that is growing at a slower pace, with a resilient
job market," CEO Brian Moynihan said in a statement, echoing
comments from his peers.
The financial health of consumers underpins BofA's consumer
banking unit, whose revenue rose 15% to $10.5 billion.
However, banks are grappling with stress in their commercial
real estate lending businesses, particularly office loan
portfolios, which are taking a hit from higher financing costs
and a permanent shift towards remote work.
To account for a gloomy backdrop, provision for credit losses
rose $602 million to $1.1 billion in the quarter.
Deposits at U.S. banks have become a focus for analysts and
investors in recent months after regional bank failures in March
prompted the biggest bout of banking turmoil since the 2008
financial crisis.
Average deposit balances fell $18 billion, or 1%, from the prior
quarter to $1.9 trillion.
Net income applicable to common shareholders rose to $7.10
billion, or 88 cents per diluted share, for the three months
ended June 30, compared with $5.93 billion, or 73 cents per
diluted share, a year earlier, the second-largest U.S. bank
reported on Tuesday.
(Reporting by Manya Saini in Bengaluru and Saeed Azhar in New
York; Editing by Lananh Nguyen and Anil D'Silva)
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