Bank of America sees surge in bond trading

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Bank of America reported its best third quarter for fixed-income trading in five years, becoming the third major U.S. bank to blow past analysts’ estimates for the business.

Bloomberg News reports that bond-trading revenue surged 39% in the period, driven by rates trading and benefits from the firm’s debt-underwriting strength Bank of America said Monday. The gains helped fuel a 7.3% jump in profit.

“The revenue beat came mostly on the trading side, which was nearly $1bn better than expected,” Chris Kotowski, an analyst at Oppenheimer, said in a note to clients.

Bank of America’s report adds to early signs on Wall Street that a multiyear slump in fixed income might have touched bottom. Citigroup said last week that its bond-trading revenue surged 35%, and JPMorgan posted $4.33bn from the business, $1bn more than estimates. The banks attributed some of the improvement to pulling share from Deutsche Bank, which has said it’s losing out on business as it battles to retain confidence amid mounting legal charges. JPMorgan singled out products linked to rates.

To access the complete Bloomberg News article hit the link below:

BofA Bond-Trading Surge Mirrors Gains at JPMorgan, Citigroup

Goldman Says U.S. Bondholders Risk a $1.1 Trillion Hit if Rates Spike

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