Bank of America announced on Wednesday that its profit increased by 12% in the fourth quarter of last year. The bank attributed this growth to rising consumer spending and a slight decrease in credit card delinquencies.
Spending on debit and credit cards rose 6% during the quarter, according to the bank. Delinquencies of over 90 days on credit cards fell to 1.27%, compared to 1.35% a year earlier.
"All of the metrics that we can see tell us the consumer remains resilient and is in great shape," said Alastair Borthwick, the bank's chief financial officer, during a call with reporters. Borthwick made these remarks as major U.S. banks are reporting their quarterly financial results this week.
On Tuesday, JPMorgan CEO Jamie Dimon stated that consumers were still spending and businesses remained healthy, while also warning of risks from geopolitical conditions. JPMorgan similarly reported higher spending on credit and debit cards and a lower 90-day delinquency rate on credit cards.
President Trump recently called for a one-year 10% cap on credit card interest rates as part of efforts to address Americans' cost of living. Industry groups have warned that such a cap could lead to a broad rollback of access to credit for consumers.
When asked about the proposed cap on Wednesday, Borthwick declined to comment directly. "We're obviously supportive of what the administration is looking to do around affordability," he said.
For the fourth quarter, Bank of America reported earnings of $7.6 billion, or 98 cents per share. Analysts had expected earnings of 96 cents per share. The bank's full-year profit was $30.51 billion, representing a 13% increase from the previous year.
Total revenue for the fourth quarter rose to $28.37 billion, exceeding analysts' expectations. Net interest income, a key profitability indicator, increased by 10% to $15.8 billion.
Provisions for credit losses were $1.3 billion, down from the previous year. Sales and trading revenue from the markets division reached $4.52 billion, up 10% from a year ago. Investment banking fees also edged higher to $1.67 billion.