independent

Sunday 20 April 2014

Bank of America's profits up by 63pc

Bank of America, the second biggest US lender, saw profits rise 63pc, beating analysts' estimates as the company kept expenses in check.

The company, which has 1,800 Irish staff, said second-quarter net income climbed to $4.01bn (€3.05bn), or 32 cents a share, from $2.46bn a year earlier.

Chief executive officer Brian Moynihan has said he'll eliminate $8bn in annual costs by the end of 2014 and $10bn tied to troubled mortgages a year later.

The biggest banks are focused on curbing expenses amid new regulations, higher capital requirements and sluggish lending.

Revenue rose 3.5pc to $22.7bn from a year earlier.

Expenses fell to $16bn from $17bn a year earlier as the staff shrank, litigation costs dropped by more than half and the division handling troubled mortgages provided less of a drag.

Profit from global markets excluding adjustments climbed 57pc to $935m. Higher equity sales and trading revenue helped boost revenue along with an increase in debt and equity issuance. (Bloomberg)

BANK OF NY MELLON PROFIT UP BY 79PC

Bank of New York Mellon, which employs more than 1,000 staff in Ireland, reported second-quarter profit rose 79pc, as the stock-market rally boosted assets and fees for overseeing them.

Net income rose to $833m (€633m) from $466m a year earlier. Profit in this year's second quarter included an after-tax gain of $109m related to an equity investment.

Chief executive Gerald Hassell has been focused on increasing the assets the bank oversees, cutting costs and raising prices to existing customers to combat the impact of lower interest rates.

In 2011, Hassell trimmed jobs and set a target to save as much as $700m by 2015 through operational improvements. "They put up a very solid quarter," said Gerard Cassidy, an analyst with RBC Capital Markets.

"Rising rates moving forward will be positive for them." (Bloomberg)

SALES BOOST PROFIT AT ABBOTT BY 16PC

US global pharmaceutical giant Abbott Laboratories said second quarter profit climbed 16pc on expanding sales in emerging markets.

The company, which has an extensive presence in Ireland, saw profit from operations rise to $476m (€362m), from $411m a year earlier.

Sales in emerging markets rose 13pc, helping revenue increase to $5.45bn from $5.31bn a year earlier.

The emerging-market revenue of $2.3bn represented more than 40pc of Abbott's total.

"We still expect Abbott's sales and earnings per share growth to outpace its MedTech and diversified peers," said Glenn Novarro, an analyst at RBC Capital Markets in New York.

"Abbott is the fastest-growing large cap company in our universe. As such, a premium valuation is justified." Abbott gained less than 1 percent to $35.70 yesterday in New York. (Bloomberg)

Irish Independent

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