Upbeat Bank of America lifted by US recovery

 
Tim Wallace
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BANK of America Merrill Lynch (Baml) saw profits rise more than four-fold as the economic recovery slashed its bad debt costs, the bank said yesterday.

It made a profit of $3.4bn (£2.1bn) in the final quarter of 2013, up from $732m in the same period of 2012.

For the full year it made $11.4bn, up from $4.2bn in the previous 12 months.

Revenues surged 6.7 per cent to $88.9bn in the year, with investment banking, equities and trading account revenues all improving.

Meanwhile costs fell four per cent to $69.2bn.

The bank cut headcount to 242,117, a fall of nine per cent on the year, helping its compensation bill fall 2.6 per cent to $35.65bn.

The resurgence pushed the bank’s return on equity up from 2.6 per cent in 2012 to 7.13 per cent in 2013.

For the final quarter that return on equity came in at 8.53 per cent, up from 1.77 per cent in the same period of the previous year.

Bank of America Merrill Lynch’s fully phased in Basel III capital ratio moved to 9.96 per cent, up from 9.25 per cent a year earlier.

“While work remains on past issues, our 240,000 teammates continue to do a great job winning in the marketplace,” said chief executive Brian Moynihan.

Its shares jumped 2.62 per cent in the day.