URGENT ALERT: Please beware of fraudulent WhatsApp groups and other groups across Social Media pretending to be affiliated with Anchor and Anchor staff members. Do not engage with these malicious and fraudulent groups in any way. Please direct all queries to invest@anchorcapital.co.za.

Bank of America Corp. 3Q18 earnings top estimates

Bank of America (BoA), in its 3Q18 results reported on Monday (15 October), indicated that its revenue stood at $22.78bn vs the $21.84bn posted in 3Q17, while diluted EPS came in at $0.66 vs $0.46 recorded in the same period of 2017. Thomson Reuters consensus forecasts had expected earnings of USc62 on revenue of $22.67bn. The bank reported a 35% YoY rise in quarterly profit as it benefited from tax cuts, while growth in lending helped BoA to offset lower bond trading revenue.Nevertheless,  Reuters writes that the bank’s loan growth lagged rivals and fees from advising on deals and underwriting bonds fell in 3Q18, weighing on its share price even as profit beat expectations.

The bank said its provision for credit losses decreased by $118mn to $716mn – well below the $964.2mn consensus estimate, while the firm’s net interest margin rose 4 bpts to 2.42 ppts, beating the consensus analyst estimate by 1-bpt. BoA also managed to cut expenses by 2% YoY to $13.1bn, matching consensus analysts’ expectations.

By segment, profit in consumer banking, its largest division, jumped 49% YoY to $3.1bn on the back of improving credit, expenses and lower taxes. That exceeded the improvements seen by wealth management, global banking and market divisions. Loans in the business rose 6% YoY to $285bn and deposits increased by 4% YoY to $688bn. BoA’sglobal markets division posted a 21% YoY rise in profit to $912mn, while fixed income trading revenue came in at $2.06bn and equities trading generated $1.01bn, roughly matching consensus expectations for the quarter.

The share price moved notably lower on Monday (15 October), slumping by c. 1.5%, despite the upbeat results. However, it closed c. 2% higher on Tuesday (16 October).




Submit your details and we’ll give you a call back to assist and advise you on your investment.


Subscribe to our newsletters to receive regular market commentary, research and updates from the Anchor team. Select between our Individual or Financial Advisor newsletters by selecting the relevant tab below.

WEBINAR | The Navigator – Anchor’s Strategy and Asset Allocation, 2Q24

Anchor CEO and Co-CIO Peter Armitage will host the webinar, provide an introduction to current global and local market conditions and give his thoughts on offshore equities. Together with Head of Fixed Income and Co-CIO Nolan Wapenaar, Pete will also discuss Anchor’s strategy and asset allocation for 2Q24, focusing on global equities and bonds. In addition, Fund Manager Liam Hechter will provide insights into local equities, highlighting some investment ideas; Global Equities Analyst James Bennet will discuss Ferrari and give an update on Tesla, and finally, Analyst Thomas Hendricks will participate in a Q&A with Peter, explaining the 10-year US Treasury to attendees.