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Bank of America earnings fall on oil exposure, trading
[NEW YORK] Bank of America earnings fell Wednesday as the hit from the energy bust and weak securities trading more than offset gains in consumer banking.
Net income in the first quarter was US$2.2 billion, down 18.1 per cent from the year-ago period.
Revenues were US$19.5 billion, down 6.7 per cent.
The US banking giant boosted its reserves in case of energy defaults by US$525 million to US$1 billion, as clients in the oil services and exploration and production sectors continue to struggle with the effects of persistently low oil prices.
Volatility in financial markets also weighed on results, with revenues from fixed income and equities trading down 17 and 11 per cent, respectively.
But BofA enjoyed a solid performance in its consumer banking business, where revenues and profits rose thanks to higher total deposits and loans. Net income for this division rose 22.2 per cent.
"In a challenging and volatile environment, we stayed true to our strategy this quarter," said chief financial officer Paul Donofrio."
We grew loans and deposits, increased core net interest income and improved an already strong and highly liquid balance sheet."
Earnings translated into 21 cents per share, meeting Wall Street expectations.
Shares of BofA dipped 0.5 per cent to US$13.74 in pre-market trade.