Financial institution of America Stories 10% Revenue Enhance as CEO Moynihan Indicators Financial Warning
By Michael Richardson
April 15, 2025
NEW YORK — Financial institution of America reported a stronger-than-expected 10% enhance in first-quarter revenue on Tuesday, although CEO Brian Moynihan tempered the constructive outcomes with warnings about rising financial challenges.
The nation’s second-largest financial institution posted a quarterly revenue of $8.2 billion, or $0.96 per share, exceeding analyst expectations of $0.92 per share. Income rose to $25.8 billion, representing a 6% enhance from the identical interval final yr.
“Whereas we’re happy with our efficiency this quarter, we acknowledge we’re working in a altering financial system that requires vigilance,” Moynihan informed traders throughout Tuesday’s convention name. “We’re seeing shifts in client habits and enterprise funding patterns that counsel warning is warranted.”
The financial institution’s client banking division delivered notably sturdy outcomes, with income growing 7% to $10.3 billion, pushed by larger curiosity earnings and average mortgage progress. The wealth administration section additionally carried out nicely, posting a 9% income enhance.
Nevertheless, funding banking charges declined 3% in comparison with the earlier quarter, reflecting diminished merger and acquisition exercise throughout the trade. Buying and selling income remained comparatively flat, regardless of durations of market volatility.
Moynihan highlighted a number of financial indicators which have prompted the financial institution’s cautious outlook, together with moderating client spending progress, slowing housing market exercise, and indicators of restraint in enterprise capital expenditures.
“The patron stays in good condition general, however we’re beginning to see early indicators of stress in sure segments,” Moynihan defined. “Bank card delinquencies are trending upward, although nonetheless beneath historic averages, and we’re observing extra selective spending behaviors.”
The financial institution reported a modest enhance in its provision for credit score losses, setting apart $1.3 billion for potential defaults, up from $1.1 billion within the earlier quarter.
Financial institution of America shares initially rose 2% in pre-market buying and selling following the announcement however surrendered these features by mid-morning as traders digested Moynihan’s cautionary feedback.
Monetary analysts famous that whereas the outcomes reveal the financial institution’s sturdy basic efficiency, the management’s financial outlook aligns with rising consensus about potential headwinds.
“Moynihan’s feedback mirror the broader uncertainty many monetary establishments are navigating,” mentioned Jennifer Paterson, banking analyst at Morgan Stanley. “The financial institution’s elevated loss provisions counsel they’re making ready for potential financial softening whereas sustaining a robust capital place.”
Financial institution of America maintained its quarterly dividend at $0.26 per share and introduced it could proceed its beforehand approved share repurchase program.
