(Businesshala) – Bank of America Corp beat estimates for third-quarter profit on Thursday, as it issued reserves of $1.1 billion and posted strong growth in its lending and equity-trading divisions.
Net income applicable to common shareholders rose to $7.26 billion, or 85 cents per share, for the quarter ended September 30, from $4.44 billion, or 51 cents per share, a year ago.
Analysts had expected an average profit of 71 cents per share, according to Refinitiv’s IBES estimate.
Revenue from the bank’s equity division increased 33%, driven by increased customer financing activities and strong business performance.
Net interest income (NII), a key measure of how much banks earn from lending, rose nearly 10% to $11.09 billion.
“Deposit growth was strong and loan balances grew for the second quarter in a row, leading to an improvement in net interest income despite a reduction in interest rates,” Chief Executive Officer Brian Moynihan said in a statement.
Bank of America set aside tens of billions of dollars last year to cover potential loan defaults, which are being released as the economic outlook improves.
Because of the structure of its balance sheet, BofA is most sensitive to changes in interest rates at large US banks.
Bank of America’s revenue jumped 12% to $22.8 billion.