Bank of America Q1 2019 Earnings Breakdown

by EarningsCallsApp

 

  • Net income of $7.3 billion rose 6%, driven by continued strong operating leverage
  • Diluted earnings per share of $0.70 rose 13%
  • Pretax income of $8.8 billion rose 4%
  • Revenue, net of interest expense, remained relatively stable at $23.0 billion
  • Net interest yield (FTE basis) of 2.51%, up 9 bps
  • Provision for credit losses increased $179 million to $1.0 billion
  • Noninterest expense declined $618 million, or 4%, to $13.2 billion; efficiency ratio improved to 57%
  • Average loan and lease balances in business segments rose $33 billion, or 4%, to $897 billion
  • Consumer loans up 3%; commercial loans up 4%
  • Average deposit balances rose $63 billion, or 5%, to $1.4 trillion
  • Repurchased $6.3 billion in common stock and paid $1.5 billion in common dividends
  • Returned 112% of net income available to common shareholders

CONSUMER BANKING

  • Net income rose 25% to $3.2 billion
  • Loans up 5% to $292 billion
  • Deposits up 3% to $697 billion
  • Consumer Investment Assets up 16% to $211 billion
  • Efficiency ratio improved to 45%
  • 27.1 million active mobile banking users
  • Revenue increased $652 million, or 7%, to $9.6 billion. NII increased $629 million, or 10%, driven by higher interest rates and deposit and loan growth
  • Provision for credit losses increased $39 million to $974 million
  • Noninterest expense decreased $189 million, or 4%, to $4.4 billion as investments for business growth were more than offset by improved productivity and lower FDIC expense
  • Average deposits grew $23 billion, or 3%; average loans grew $13 billion, or 5%
  • Consumer Investment Assets grew $29 billion, or 16%, to $211 billion, driven by strong client flows and market performance
  • 15 new financial centers opened in 1Q19
  • 27.1 million active mobile banking users, up 9%
  • Digital sales were 27% of all Consumer Banking sales
  • 1.5 billion mobile logins in 1Q19
  • 5.4 million active Zelle® users, up 2.7x since launch in June 2017
  • Efficiency ratio improved to 45% from 51%

Global Wealth & Investment Management

  • Net income rose 14% to $1.0 billion
  • Pretax margin increased to 29%
  • Total client balances of $2.8 trillion
  • Loans up 3%; deposits up 8%
  • Record net new Merrill Lynch households, up 85%
  • Revenue decreased $36 million, or 1%, as higher net interest income was more than offset by lower asset management fees driven by lower market valuations as well as a decline in transactional revenue
  • Noninterest expense decreased 4%, as investments for business growth were more than offset by lower amortization of intangibles, revenue-related incentives and FDIC expense
  • Total client balances of $2.8 trillion up 4%, driven by net flows and higher end-of-period market valuations
  • Average loans and leases grew $5 billion, or 3%, driven by custom lending and mortgages
  • Pretax margin improved to 29%
  • Wealth advisors up 1% to 19,523
  • Strong wealth management household growth continues
  • Record net new Merrill Lynch households, up 85%
  • Private Bank net new households, up 39%

Global Banking

  • Net income rose 2% to $2.0 billion
  • Firmwide investment banking fees of $1.3 billion (excludes self-led)
  • Loans increased 5% to $370 billion
  • Deposits increased 8% to $349 billion
  • Efficiency ratio improved to 44%
  • Net income of $2.0 billion, up $39 million or 2%
  • Revenue of $5.2 billion, up $160 million or 3%
  • Provision increased $95 million to $111 million primarily due to a single-name utility client charge-off in 1Q19 and the absence of 1Q18 energy reserve releases
  • Noninterest expense decreased 1%, primarily due to lower FDIC expense, partially offset by continued investment in the business
  • Average deposits increased $25 billion, or 8%, to $349 billion
  • Average loans and leases grew $18 billion, or 5%, to $370 billion
  • Total Corporation investment banking fees of $1.3 billion (excl. self-led) declined 7%, driven by lower debt and equity underwriting fees

Global Markets

  • Sales and trading revenue of $3.5 billion, including net debit valuation adjustment (DVA) losses of $90 million
  • Excluding net DVA, sales and trading revenue down 13% to $3.6 billion
  • Equities down 22% to $1.2 billion
  • FICC down 8% to $2.4 billion
  • Revenue of $4.2 billion, down $631 million or 13%; excluding net DVA, revenue decreased 10%
  • Noninterest expense decreased $168 million, or 6%, to $2.8 billion driven by lower revenue-related expenses
  • Average VaR of $37 million remained low
  • Reported sales and trading revenue decreased 17% to $3.5 billion
  • Excluding net DVA, sales and trading revenue decreased 13% to $3.6 billion(B)
  • FICC revenue of $2.4 billion decreased 8% primarily due to lower client activity across most businesses
  • Equities revenue of $1.2 billion decreased 22% from a record year-ago quarter that benefited from higher client volumes and a strong performance in derivatives on elevated market volatility
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