Bank of America (NYSE:BAC) beat analyst expectations when it announced its third quarter turned profitable on better revenue, improving credit quality, and one-off gains.
Bank of America’s (NYSE:BAC) stock has been pummeled over 50% this year under the stewardship of CEO Brian T Moynihan, who has vowed to downsize and cut costs at the bank. Net income was $6.23 billion as compared to a loss of $7.3 billion a year earlier, with total revenues rising 6% to $28 billion, handily beating most analyst estimates.
The numbers were bolstered by one-off gains on revaluations of structured liabilities, a sale of its stock in China Construction Bank Corp, and debt value readjustments. Improved credit quality was reflected in lower provision for losses on loans, down to $3.4 billion from $5.4 billion. But troubles continue at the bank’s mortgage unit, which posted a $1.1 billion loss and faces claims arising from faulty mortgages and foreclosures. Bank of America (NYSE:BAC) was also hit by a credit downgrade earlier this year.