On Wednesday, Jan. 19, Bank of America (BAC) published its fourth-quarter 2021 financial results. Earnings for the quarter beat market estimates. As of 10:12 am EST today, BAC stock gained 1.76% in value.
Fourth-Quarter 2021 Results
Bank of America reported $7.01 billion in profit (a 28% increase) for its fourth quarter, with earnings coming out to $0.82 per share, beating estimates of around $0.76 per share. Revenue of $22.17 billion was slightly below forecasters’ predictions of around $22.2 billion.
Release of Pandemic Loan Loss Reserves
Bank of America released pandemic loan loss reserves of $851 million during the quarter as well, which helped boost income. The loan loss reserves had been built up to deal with the economic effects (like possible defaults) stemming from the COVID-19 pandemic.
Interest Rate Challenges
The company managed to grow loans and deposits — despite a challenging rate environment (due to the Federal Reserve lowering interest rates because of the pandemic) — increasing “net interest income by $1.2 billion versus the year-ago quarter…” according to CFO Alastair Borthwick
CEO Comments
“Our fourth-quarter results were driven by strong organic growth, record levels of digital engagement, and an improving economy. We grew loans by $51 billion and added $100 billion of deposits during the quarter, further strengthening our position as the leader in retail deposit,” Chairman and CEO Brian Moynihan remarked in an earnings release.