Bank of America profit up

Bank of America Corp, the No 3 US bank, on Monday said first-quarter profit surged 75 percent to a record, on increased consumer and commercial lending, higher trading income, and the acquisition of FleetBoston Financial Corp Net income rose to $4.7 billion, or $1.14 per share, from $2.68 billion, or 91 cents per share, a year earlier. Excluding merger and restructuring charges of $112 million, profit was $1.16 per share. Results also included $659 million of one-time gains on the sale of debt securities and a $437 million increase in trading profit.
Analysts polled by Reuters Estimates on average expected a profit of 97 cents per share.
"It was an excellent quarter," said Stephen Berman, a portfolio manager at Stein Roe Investment Counsel in New York. "They had respectable growth in revenue and net interest income, and had very good trading results."
Berman estimated core profit at $1.01 per share. His firm's $7 billion of assets include Bank of America shares.
Shares of Bank of America, based in Charlotte, North Carolina, rose 40 cents to $44.68 in early trading on the New York Stock Exchange.
Revenue increased 47 percent to $14.22 billion, topping analyst forecasts for $13.79 billion.
Lending income increased 35 percent to $8.07 billion, while fee income jumped 65 percent to $6.15 billion. Noninterest expense rose 30 percent to $7.06 billion. Compared with the fourth quarter, lending and fee income increased, while expenses fell.
Bank of America added a net 759,000 savings and 610,000 checking accounts, both records, and 1.34 million credit card accounts.
"We saw the strongest commercial loan growth in many quarters across our company and deposit growth continues to be robust," Chief Executive Kenneth Lewis said in a statement.
Merger-related savings totalled $437 million, and Bank of America eliminated about 1,000 jobs in the quarter. The quarter was the last when year-earlier comparisons won't include results from Fleet, which Bank of America bought in April 2004 for $48 billion.
Consumer and small-business banking earned $1.9 billion, up 77 percent, on revenue of $6.96 billion.
Business and financial services banking nearly doubled to $1.12 billion on revenue of $2.73 billion. Profit from wealth and investment management, including mutual funds, more than doubled to $576 million on revenue of $1.79 billion.
The investment bank last quarter took in $721 million, up 59 percent, on revenue of $2.63 billion. Trading profit more than doubled to $704 million from $267 million.
Loans and leases rose 41 percent to $529.5 billion, deposits rose 45 percent to $630 billion and assets increased 52 percent to $1.21 trillion.