Bank of America

Corp.’s traders posted a record second quarter as the company reaped the benefits of volatile markets and net interest income topped analysts’ estimates.

Revenue from fixed income, currencies and commodities trading jumped 19 per cent to US$3.25 billion in the three months through June, the company said in a statement Wednesday. That helped Bank of America top analysts’ estimates for per-share earnings. Equity trading rose 9.6 per cent to US$2.13 billion, also topping expectations.

Volatility has whipsawed global markets since U.S. President Donald Trump announced tariffs on trading partners around the world in April. That’s been good news for the markets businesses at Bank of America and its rivals across Wall Street as they have benefited from a surge in client activity while also thwarting expectations for a strong rebound in mergers and acquisitions.

The second-largest U.S. bank also said that net interest income, a key source of revenue for the company, rose 7.1 per cent to US$14.7 billion. Analysts had expected a 6.5 per cent increase for NII, the revenue collected from loan payments minus what depositors are paid.

“Consumers remained resilient, with healthy spending and asset quality, and commercial borrower utilization rates rose,” chief executive officer Brian Moynihan said in the statement. “In addition, we saw good momentum in our markets businesses.”

Overall, Bank of America’s second-quarter profit rose, with net income up 3.2 per cent to US$7.12 billion, more than the US$6.56 billion analysts had predicted.

Bank of America’s results offer a further look at how the biggest U.S. banks fared at the beginning of Trump’s second term. Investors are also eager to hear details on the national economy from executives whose firms cater to large swaths of American consumers and businesses.

On Tuesday, JPMorgan Chase & Co. and Citigroup Inc. reported earnings that beat analysts’ estimates, with trading and investment-banking activity boosting results. Executives at both banks expect the momentum in trading to continue and the investment-banking pipeline to build as corporate clients get more comfortable with geopolitical tensions.

Shares of Charlotte, N.C.-based Bank of America have gained 5.1 per cent in the past 12 months, less than the 19 per cent increase in the S&P 500 Financials index.

Bank of America’s top-line revenue came in at US$26.5 billion, marking the second-highest quarter on record and just missing the analyst consensus of US$26.6 billion. Adjusted earnings totaled 89 cents a share, beating the 85-cent average estimate.

Investment-banking revenue fell seven per cent from a year earlier, signaling tepid recovery in dealmaking for the firm, but fared better than analysts expected. Fees for advising on mergers and acquisitions dropped 11 per cent, and revenue from equity and debt issuance fell 8.1 per cent and 4.9 per cent, respectively.

April was a “difficult month,” but there was a pickup in May and June to “something more normal,” chief financial officer Alastair Borthwick said on a call with journalists after the results were announced. “We are encouraged by all of that” and expect a further improvement in investment-banking activity in the second half of the year, he said.

The company’s loan balances rose to US$1.15 trillion at the end of the second quarter, up 8.5 per cent from a year earlier and more than analysts’ estimates of US$1.12 trillion. Lending has been a key focus for investors, if lower interest rates eventually spur more borrowing and loans become less costly.

Bank of America’s noninterest expenses rose 5.4 per cent from a year earlier to US$17.2 billion. Charges and costs are another focal point for investors, with persistent inflation putting pressure on spending. Analysts had expected a 5.5 per cent increase.

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The company also maintained its guidance of US$15.5 to US$15.7 billion for NII on a fully taxable equivalent basis for 2025, expecting low-single-digit deposit growth and mid-single-digit loan growth, according to a shareholder presentation.

“We’re now seeing the second-half benefits start to kick in, and we’ll expect to get the kick in NII, pushing operating leverage back in the business,” Moynihan said on a call with analysts.

Bloomberg.com