Bank of American announced its fourth quarter earnings for 2013 this morning beats analyst estimates by $0.02 with an earnings per share of $0.29 and revenue at $21.7 Billion.
Analysts expected an earnings per share to come in at $0.27 with a revenue of $21.1 billion.
Shares are up 2% in premarket trading on this news.
There are two major things Wall Street is waiting to see in this report — how the 'New BAC' plan of cost cutting that Brian Moynihan has championed is going, and how Bank of America's mortgage business.
One crazy cost cutting fact for you — the number of employees at Bank of America is down 9% since New BAC started.
An yesterday, we got a look at how the mortgage business is doing at JP Morgan and Wells Fargo, and it wasn't great. Wells Fargo managed to get through it by cost cutting, but JP Morgan, weighed down with legal fees, disappointed the Street. Federal Reserve survey results showed weaker demand in both prime and on traditional mortgage loans this quarter, according to FactSet data, so this shouldn't be too surprising.
Here's what CEO Moyninhan said in his letter accompanying earnings.
Bank of America Corporation today reported net income of $3.4 billion, or $0.29 per diluted share, for the fourth quarter of 2013, compared to $732 million, or $0.03 per diluted share in the year-ago period. Revenue, net of interest expense, on an FTE basisA rose 15 percent from the fourth quarter of 2012 to $21.7 billion.
For the year ended December 31, 2013, net income increased to $11.4 billion, or $0.90 per diluted share, from $4.2 billion, or $0.25 per diluted share, in 2012. Revenue, net of interest expense, on an FTE basisA rose 7 percent to $89.8 billion.
"We are pleased to see the core businesses continue to perform well, serving our customers and clients," said Chief Executive Officer Brian Moynihan. "While work remains on past issues, our two hundred forty thousand teammates continue to do a great job winning in the marketplace."
“We enter this year with one of the strongest balance sheets in our company’s history,” said Chief Financial Officer Bruce Thompson. “Capital and liquidity are at record levels, credit losses are at historic lows, our cost savings initiatives are on track and yielding significant savings, and our businesses are seeing good momentum.”
Now check out BAC's the release below:
Income of $3.4 Billion, or $0.29 per Diluted Share, on Revenue of $21.7 Billion(A)
Fourth-quarter 2013 Results Included
Pretax Negative DVA/FVO Adjustments of $0.6 Billion due to Tightening of the Company's Credit Spreads
Pretax Litigation Expense of $2.3 BillionEffective Tax Rate of 10.6 Percent
Fourth-quarter 2013 Highlights Compared to Year-ago Quarter
Period-end Consolidated Deposit Balances Increased $14 Billion to Record $1.12 Trillion
Period-end Loan Balances Increased $20 Billion to $928 Billion
Combined Debit and Consumer Credit Card Spending Rose 4.0 Percent to $123 Billion
Period-end Commercial Loan Balances Increased $42 Billion to $396 Billion
Global Wealth and Investment Management Pretax Margin Increased to 26.6 Percent From 21.1 Percent
Record Global Banking Revenue of $4.3 Billion, up 9 Percent
Achieved New BAC and Legacy Assets and Servicing 2013 Cost Savings Targets
Credit Quality Continued to Improve With Net Charge-offs Down 49 Percent; Ratio at 0.68 Percent
Basel 1 Tier 1 Common Capital of $145 Billion, Ratio of 11.19 Percent
Basel 3 Tier 1 Common Capital Ratio of 9.96 Percent, up From 9.25 PercentD
Full-year 2013 Highlights Compared to Full-year 2012
Nearly $90 Billion in Residential Home Loans and Home Equity Loans Funded in 2013
More Than 3.9 Million New Consumer Credit Cards Issued in 2013
Record Earnings of $3 Billion in Global Wealth and Investment ManagementBank of America Merrill Lynch Gained Market Share and Maintained No. 2 Ranking in Global Investment Banking Fees
CLiquidity Remained Strong at $376 Billion; Parent Company Time-to-required Funding Improved to 38 Months From 33 MonthsInitiated Capital Return to Shareholders Through Repurchase of $3.2 Billion of Common Stock at an Average Price of $13.90 per Share
See Also:Bank Of America Just Confirmed The Fed's Fears About The US Mortgage MarketElizabeth Warren's Going To Call Out JP Morgan CEO Jamie Dimon On TV TonightChris Christie's Wall Street Supporters Aren't Worried About Bridgegate