Bank of America (BAC) Q3 2024 results

Bank of America beat analysts' estimates for third-quarter profit and revenue on better-than-expected trading results.

Here's what the company reported:

• Earnings: 81 cents versus 77 cents LSEG estimate
• Revenue: $25.49 billion versus an estimate of $25.3 billion

The bank said Tuesday that net income fell 12% from a year earlier to $6.9 billion, or 81 cents per share, due to higher provisions for loan losses and rising expenses.

Revenue rose less than 1% to $25.49 billion as increases in trading revenue, asset management and investment banking fees offset a decline in net interest income.

The bank's shares ended the session up less than 1%.

Bank of America, led by CEO Brian Moynihan since 2010, demonstrated the benefits of being a massive and diversified financial institution. Analysts have focused on the bank's core business of taking deposits and lending to consumers and businesses as rising interest rates erode the company's interest income.

However, the quarter showed that the bank, like its peers, is benefiting from increasing activity on Wall Street through its trading and advisory activities JPMorgan Chase And Goldman Sachs did.

Fixed income trading revenue rose 8% to $2.9 billion, topping StreetAccount's estimate of $2.74 billion, driven by strong currency and interest rate activity. Stock trading rose 18% to $2 billion, beating the StreetAccount estimate of $1.81 billion on higher cash and derivatives volumes.

Investment banking fees also rose 18% to $1.40 billion, topping StreetAccount's estimate of $1.27 billion.

While net interest income fell 2.9% year over year to $14.1 billion, beating StreetAccount's estimate of $14.06 billion.

This NII value was higher in the third quarter than in the second quarter, a sign that the performance of this key metric is improving. The lender said in July that a recovery in net interest income was imminent in the second half of the year.

Bank of America “appears to be turning the corner” on the NII turnaround, although the degree from here on depends on interest rates, Wells Fargo analyst Mike Mayo said in a note on Tuesday.

NII, one of the main ways banks make money, is the difference between what a bank earns from loans and investments and what it pays depositors for their savings.

The bank's provisions for loan losses were $1.5 billion in the quarter, slightly below the estimate of $1.57 billion.

JPMorgan Chase and Wells Fargo reported earnings that beat estimates on Friday, helped by their investment banking operations. Goldman Sachs And Citigroup also reported results on Tuesday, during Morgan Stanley will announce the results on Wednesday.