NEW YORK – Bank of America Corp. (BAC), the No. 3 U.S. bank, on Tuesday said fourth-quarter profit rose 41 percent, helped by growth in consumer banking fees and its purchase of FleetBoston Financial Corp (search).
Net income for the Charlotte, N.C.-based company rose to $3.85 billion, or 94 cents per share, from $2.73 billion, or 92 cents per share, a year earlier.
Results included merger and restructuring charges of $181 million, or 4 cents per share, and reflect a recent 2-for-1 stock split.
Analysts polled by Reuters Estimates on average forecast profit of 92 cents per share.
Revenue rose 42 percent to $13.9 billion, as lending income rose 38 percent to $7.96 billion and fee income rose 47 percent to $5.96 billion.
Chief Executive Kenneth Lewis said Bank of America remains "on schedule" in integrating Fleet, which it bought for $48 billion last April.
He said he expects the bank in 2005 to meet the challenges of a flattening yield curve, or narrowing of the gap between long- and short-term interest rates, and integration of Fleet systems in the U.S. northeast.
The bank in the quarter added a net 729,000 savings accounts and 596,000 checking accounts, and added 1.53 million credit card accounts. It reported growth in credit and debit card transaction volumes and balances, trading and assets under management.
The bank, which employs nearly 176,000 people, is in the process of eliminating 17,000 jobs even as it invests more than $600 million to strengthen its investment bank.
In the fourth quarter, consumer and small-business banking earned $1.76 billion on revenue of $7.59 billion. Commercial banking earned $887 million on revenue of $1.95 billion. Wealth and investment management, including mutual funds, earned $477 million on revenue of $1.68 billion.
The corporate and investment bank earned $596 million on revenue of $2.2 billion, helped by a more than eight-fold increase in trading profit to $233 million.
Bank of America has been sued for $10 billion by the administrator of Parmalat SpA (search), the collapsed Italian food company and a former client.
Bank of America set aside $706 million for bad loans, up 21 percent. Nonperforming assets fell 19 percent to $2.46 billion. Loans and leases rose 40 percent to $521.8 billion, deposits rose 49 percent to $618.6 billion, and assets rose 54 percent.
Net interest yield fell to 3.26 percent from 3.4 percent.
Through Friday, Bank of America shares had risen 12 percent in the last year, from a split-adjusted $40.03, compared with a 1 percent increase in the Philadelphia KBW Bank Index.