Shares of Bank of America (BAC) closed 4.27% higher today after the company announced second quarter earnings of 63 cents a share, 6 cents a share above the Wall Street consensus. Revenue fell 0.9% year over year but at $22.6 billion it still exceeded the $22.5 billion consensus.
Net interest income rose 6% to $11.7 billion on higher interest rates and growth in loans and deposits. Total loans climbed 2%.
The bank continued to make progress on CEO Brian Moynihan’s goal to cutting expenses to $53 billion by the end of the year. Bank of America said it remained on track to meet that goal.
Thanks to higher earnings, lower expenses, and a clean bill of health on the Federal Reserve’s latest stress test, the bank confirmed that it will raise its quarterly dividend by 25% beginning in the third quarter. That, of course, is of special interest to dividend investors. Bank of America is a member of my Dividend Portfolio. (The share price is down 6.7% since I added the shares to the portfolio On January 23, 2018.)
“In the next 12 months, we plan to return $26 billion to shareholders through common dividends and share repurchases,” said CEO Moynihan.