BofA Plods Toward More Basics, Less Risk
Bank of America continues its steady plod toward a more boring future focused on banking basics, rather than the risky behaviors that drove profits during the high-flying years.
But don't take our word for it – here's Bank of America CEO Brian Moynihan discussing the company's third quarter earnings with investors on Wednesday: "Consistent with prior quarters, our company continues to show progress on the areas we've been focused upon: capital generation, managing risk, achieving cost savings, addressing legacy issues and driving our core growth strategies in our core lines of business."
Those core lines of business include a nine-percent increase in customer deposits and a 26 percent boost in the number of people banking via mobile phone compared to last year.
Fewer people defaulted on their credit cards, too. But the-once-lucrative home loan market continues to be far-less-so. Bank of America has managed to offset some of the slow revenue growth by cutting expenses, including some 40,000 full-time positions in the last three years.
As a result, BofA's third quarter income narrowly beat analyst expectations at $2.5 billion dollars, or 20-cents a share. This time last year, the bank barely broke even after spending more than $2 billion to settle a shareholder lawsuit over the acquisition of Merrill Lynch.