Bank of America shares declined after the lender posted third-quarter results that missed on revenue.
The firm said Wednesday that it generated $20.45 billion in total revenue, missing the $20.8 billion estimate of analysts surveyed by Refinitv. Profit in the quarter slumped 16% to $4.9 billion, or 51 cents a share, edging out the 49 cents estimate.
Shares of the firm dropped 2% in premarket trading.
Bank of America’s revenue was under pressure by falling interest rates. It’s net interest income fell by $2.1 billion from a year earlier to $10.2 billion. CEO Brian Moynihan has said that the key figure will likely bottom out in the third quarter.
Here’s what Wall Street expected:
Earnings: 49 cents a share, 12% lower than the year earlier period, according to Refinitiv.
Revenue: $20.8 billion, 9.4% lower than a year earlier.
Net Interest Margin: 1.82%
Trading Revenue: Fixed Income $2.28 billion, Equities $1.2 billion
Will Bank of America join rivals by posting improving results as loan provisions subside?
Bank of America, the second-biggest U.S. lender by assets, has booked a total $9.8 billion provision for credit losses in the first two quarters of 2020. Analysts expect that figure to shrink in the third quarter, just as it has at competitors.
Like JPMorgan, the bank could also see a boost from its trading operations.
Shares of Bank of America have declined 29% so far this year, a slightly better performance than the KBW Bank Index.
This story is developing. Please check back for updates.