Bank of America, one of the largest banks in the United States, reported mixed fourth-quarter earnings on Thursday, with profit declining due to $3.7 billion in charges related to taxes and restructuring. However, the bank also saw a resilient US economy and reported billions in earnings.
According to the bank’s earnings report, net income for the fourth quarter of 2023 was $4.2 billion, down 37% from the same period last year. This was primarily due to the $3.7 billion in charges, which included a $2.4 billion tax expense and $1.3 billion in restructuring costs.
Despite the decline in profit, Bank of America’s revenue for the quarter was $22.3 billion, up 2% from the same period last year. The bank’s net interest income, which is the difference between what it earns on loans and what it pays on deposits, was $12.6 billion, up 4% from the same period last year.
“We are pleased with our fourth-quarter results, which reflect the resilience of our clients and the strength of the US economy,” said Brian Moynihan, CEO of Bank of America. “We continue to make progress on our strategic priorities, including the efficient deployment of our capital and the transformation of our franchise.”
The bank’s shares were down 2% in pre-market trading on Thursday, as investors appeared to be disappointed by the decline in profit. However, the bank’s stock has risen 25% over the past year, outperforming the broader market.
Bank of America’s results were mixed compared to those of its peers. JPMorgan Chase, the largest bank in the US, reported a 14% increase in profit for the fourth quarter, while Wells Fargo, the fourth-largest bank, reported a 17% increase. Citigroup, the third-largest bank, reported a 21% increase in profit.
The bank’s results were also impacted by its consumer banking segment, which saw a 2% decline in revenue due to lower deposit balances and a decrease in credit card usage. However, the bank’s global banking segment saw a 10% increase in revenue, driven by higher investment banking fees and a 22% increase in equity underwriting.
Looking ahead, Bank of America expects to continue to benefit from the resilient US economy and its own strategic priorities.