A huge surge in trading and investment banking revenue helped boost Bank of America's quarterly profit. Fred Katayama reports.
Bank of America bucking the trend among big U.S. banks reporting so far, producing an increase in quarterly profit that easily beat estimates. The 5 percent rise was the first gain in three quarters. But driving that profit were the same factors as the others: a huge surge in trading and investment banking revenue, especially fixed income. Bank of America says the momentum in bond trading strengthened as the third quarter progressed and that trend is continuing into the current quarter. An increase in debt underwriting boosted investment banking results. KBW analyst Brian Kleinhanzl said, "Better markets make the third quarter better than expected." The bank managed to cut costs by more than 3 percent. It's a key part of CEO Brian Moynihan's strategy, for he has pledged to slash annual expenses by another $5 billion by 2018. Bank of America shares rising in early trading, chipping away at their nearly 5 percent loss this year.