Bank of America earnings beat as legal costs drop

Brian Fonzie Moynihan

Bank of America earnings topped expectations, reversing a year-earlier loss related to a settlement with the U.S. government over mortgages.

The banking giant posted third-quarter adjusted earnings of 37 cents per share, reversing a year-earlier loss related to a multibillion-dollar settlement with the U.S. government over mortgages.

Total revenue on a fully taxable equivalent basis fell 2.4 percent to $20.91 billion.

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Analysts expected the company to post earnings per share of 33 cents on revenue of $20.77 billion, according to a Thomson Reuters consensus estimate.

"The key drivers of our business — deposit taking and lending to both our consumer and corporate clients — moved in the right direction ... and our trading results on behalf of clients remained fairly stable in challenging capital markets conditions," Chief Executive Brian Moynihan said in a statement.

BofA's noninterest income, which includes revenue from equity and bonds trading and mortgage banking, rose 1.6 percent to $11.17 billion.

BofA, which has paid more than $70 billion in legal fees since 2008, said those costs fell for the third straight quarter, dropping to $231 million from $6 billion a year earlier.

The company's shareholders voted down the splitting of the chairman and CEO positions on Sept. 22.

Shares of the banking giant have lagged considerably this year when compared with those of other major banks. Bank of America's stock has fallen more than 10 percent in that time, while shares of Well Fargo and Citigroup have both dropped about 5 percent, according to FactSet.

Reuters contributed to this report.

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