BofA’s Moynihan Flags ‘Resilient’ Consumer As Trading Surge Powers Q1 Beat – BAC Stock Climbs 1%

• Revenue rose 7% to $30.3 billion, and came above Wall Street’s estimates of $29.74 billion, according to Fiscal.ai data.
• Global Markets revenue came in at $6.4 billion, with equities revenue surging 30%.
• Bank of America said it has about $20 billion in private credit exposure.

Healthy client activity and resilient consumer spending helped Bank of America (BAC) earnings exceed Wall Street expectations in the first quarter, driven by double-digit growth in its sales and trading revenue.

The lender’s results, which follow a strong showing from Goldman Sachs, highlight a broader trend across the U.S. banking sector: trading desks are once again doing the heavy lifting even as macro risks linger.

BAC shares were up 1.4% in pre-market trading on Wednesday.

Trading Boom Drives Revenues

Revenue rose 7% to $30.3 billion, and came above Wall Street’s estimates of $29.74 billion, according to Fiscal.ai data, boosted by strong performances across the board. The bank’s diluted earnings per share surged 25% to $1.11, compared to estimates of $1.02.

Growth Seen Across Segments

Consumer Banking generated $11 billion in revenue, up 5% from the prior year. Global Wealth and Investment Management brought in $6.7 billion, up 12% on stronger asset management fees.

In Global Banking, investment banking fees totaled $1.8 billion, up 21%, reflecting improved deal activity. Meanwhile, Global Markets delivered $6.4 billion in sales and trading revenue, climbing 13% year over year, with equities revenue surging 30%.

“We remain watchful of evolving risks. However, we saw healthy client activity, including solid consumer spending and stable asset quality, indicating a resilient American economy,” Chair and CEO Brian Moynihan said.

The results followed a strong showing from Goldman Sachs (GS) on Tuesday, as it delivered a strong first-quarter performance, led by a 27% growth in equities revenue.

Private Credit Exposure

Major U.S. banks are shedding more light on their growing exposure to private credit. Bank of America said it has about $20 billion in private credit exposure.

JPMorgan Chase reported roughly $50 billion. Wells Fargo disclosed $36.2 billion in the first quarter, and Citigroup reported $22 billion. Meanwhile, BlackRock CEO Larry Fink said institutional demand remains strong, with insurers increasing allocations to high-grade private credit.

However, retail investors are pulling back amid liquidity and risk concerns, leading to record fund redemptions and prompting some asset managers to impose withdrawal limits.

Meanwhile, retail sentiment on Stocktwits shifted to ‘extremely bullish’ from ‘bullish’ a day earlier, amid ‘high’ message volumes.

BAC shares have declined nearly 5% so far this year.

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