Bank of America Corp (BAC.N) reported a smaller-than-expected 13% fall in first-quarter profit on Monday, as strong growth in its consumer lending business helped cushion the blow from a slowdown in global deal-making.
The bank reported a 9% rise in consumer banking revenue to $8.8 billion in the quarter ended March.
"First-quarter results were strong despite challenging markets and volatility," Chief Financial Officer Alastair Borthwick said in a statement.
Investment banking businesses have taken a hit
However, total investment banking fees plunged 35% to $1.5 billion in the quarter.
Big U.S. banks benefited from a deal-making boom last year after the Federal Reserve pumped liquidity into capital markets to mitigate the economic impact of the COVID-19 pandemic.
Bank of America's global banking segment, which houses the investment banking business, reported $165 million of provisions for credit losses, primarily because it built reserves tied to its exposure to Russia and a growth in loans.
The second-largest U.S. bank by assets released $362 million from its reserves it had set aside for bad loans.
Profit applicable to common shareholders fell nearly 13% to $6.6 billion, or 80 cents per share, for the quarter ended March 31 from $7.56 billion, or 86 cents per share, a year earlier.
The earnings number for the latest quarter had tough comparisons, as the year-ago period included profits from record deal-making activity and large reserve release.
The bank reported an 8% rise in pre-tax, pre-provision earnings, which strip out reserves.
Analysts on average had expected a profit of 75 cents per share, according to the IBES estimate from Refinitiv.
Shares of the bank were up 1% in premarket trading.
Bank of America rounds out a mixed earnings season for Wall Street banks with peers JP Morgan Chase (JPM.N), Goldman Sachs (GS.N), Wells Fargo (WFC.N), Morgan Stanley (MS.N) and Citigroup (C.N) posting profit declines.