Bank of America (BAC) Q2 2024 earnings summary

Executive summary

• Net income for Q2 2024 was $6.9B ($0.83 EPS), down from $7.4B ($0.88) year-over-year, with revenue up 1% to $25.4B, led by noninterest income growth and offset by lower net interest income.

• CET1 ratio rose to 11.9%, book value per share increased 7% year-over-year to $34.39, and $5.4B was returned to shareholders via dividends and buybacks.

• Provision for credit losses increased to $1.5B from $1.1B year-over-year, with net charge-offs of $1.5B, reflecting higher credit card and commercial real estate losses.

• Board authorized a new $25B stock repurchase program effective August 1, 2024, and raised the quarterly dividend by 8% to $0.26 per share.

• Digital engagement remains robust, with 47M active mobile users and 53% of consumer sales conducted digitally.

Financial highlights

• Net income of $6.9B, EPS $0.83, revenue $25.4B (+1% YoY), noninterest income $11.7B (+6%), NII $13.7B (-3%).

• Efficiency ratio at 64%, return on average assets 0.85%, ROE 10.0%, ROTCE 13.6%.

• Book value per share $34.39 (+7% YoY), tangible book value per share $25.37 (+9% YoY).

• Average deposits $1.91T (+2% YoY), average loans and leases $1.05T (modest YoY growth).

• Net charge-off ratio 0.59% (up from 0.33% YoY), allowance for loan and lease losses $13.2B (1.26% of loans).

Outlook and guidance

• Net interest income projected to increase to ~$14.5B in Q4 2024, assuming three 25 bp rate cuts and fixed-rate asset repricing.

• Low single-digit growth expected in both loans and deposits for the remainder of 2024.

• Credit quality remains stable but is closely monitored, especially in commercial real estate and credit card portfolios.

• The new SCB and CET1 requirements will be effective from October 2024 through September 2025.

• BSBY cessation impact to be recognized in interest income starting November 2024 and through 2026.