07:27 AM EDT, 07/16/2014 (MT Newswires) -- Bank of America (BAC) reported Q2 profit and revenue that fell from a year earlier due to litigation expenses, but earnings topped estimates and revenue on a non-GAAP basis was in line.
Net income was $2.3 billion, or $0.19 per diluted share, down from $4.0 billion, or $0.32 per diluted share, in the year-ago period, but above the $0.07 expected by analysts polled on Capital IQ.Revenue, net of interest expense, declined 4 percent from the second quarter of 2013 to $22.0 billion. Analysts were looking for $21.7 billion. The results include a pre-tax charge from litigation of $0.22 a share. On a GAAP basis revenue was $21.7 billion compared with $22.7 billion a year ago.
"The economy continues to strengthen, and our customers and clients are doing more business with us," said Chief Executive Officer Brian Moynihan. "Among other positive indicators, consumers are spending more, brokerage assets are up by double digits and our corporate clients are increasingly turning to us to help finance business expansion and merger activity. We are well positioned for further progress."
Bank of America on July 15 reached a settlement with AIG (AIG) resolving all outstanding litigation related to mortgage backed securities. The AIG settlement amount of $650 million was covered by litigation reserves as of June 30, 2014. Bank of America has now resolved approximately 95 percent of the unpaid principal balance of all RMBS litigation, it said.
The shares are edging lower in pre-market trading, down 0.4% at $15.75.
Price: 15.75, Change: -0.06, Percent Change: -0.38
For those that are listening to chicken little headlines check Bloomberg to quote"Net income fell to $2.29 billion in the second quarter, or 19 cents a share, from $4.01 billion, or 32 cents, a year earlier, the Charlotte, North Carolina-based firm said today in a statement. Earnings excluding litigation costs were 41 cents a share. The average estimate of 24 analysts surveyed by Bloomberg was 29 cents"