Bank of America beat forecasts in the second quarter

Bank of America reported a sharp jump in second quarter profits despite only a moderate pick-up in income.

Net interest income grew 4.8% to $10.72bn, while expenses decreased by 4%.

The lender’s net profits surged by 132% during the period to reach $5.3bn or the equivalent of 45 cents per share.

That was well ahead of the 19 cents per share achieved in the comparable period one year ago.

Analysts had forecast EPS of 36 cents.

“Solid core loan growth, higher mortgage originations and the lowest expenses since 2008 contributed to our strongest earnings in several years, as we continued to build broader and deeper relationships with our customers and clients,” said Chief Executive Officer Brian Moynihan.

Revenues, net of interest expense, on an FTE basis, increased by 2% from the second quarter of 2014 to reach $22.3bn.

“Revenue trends were positive with NII 5% ahead of consensus and NIR 2% ahead, along with expenses 4% lower. This resulted in a solid 19% pre-provision profit beat. Loan loss provisions were also slightly lower than consensus” analysts from SocGen wrote in a research report e-mailed to clients.

Return on average tangible common equity printed at 12.8%.

As of 15:37 shares in Bank of America were 2.92% higher to $17.64.