BofA and Morgan Stanley saw record profits from stock trading amid war

One of Wall Street's largest banks, Bank of America and Morgan Stanley, were the beneficiaries of strong trading activity in the markets during the Iran crisis. On April 15, they reported strong results for the first quarter thanks to record revenue from equity trading.

Trading divisions of U.S. banks, which were already on the rise amid frequent changes in President Donald Trump's trade policies, benefited from volatility during a quarter during which war with Iran caused oil prices to spike and concerns about artificial intelligence and private lending sharply swayed quotes, Bloombergnotes.This trend was confirmed by other banks from the top ten, which reported earlier this week: Goldman Sachs, JPMorgan Chase and Citigroup also recorded record revenues from operations with shares.

- Bank of America, the second-largest bank in the U.S., beat revenue and profit expectations in the first quarter thanks to growth in income from equity trading. Amid heightened volatility, this area brought record revenue, allowing the bank's trading business to show its best quarter in 15 years, CNBC notes.

It was the revenue from stock trading that became one of the key factors that allowed the bank to beat Wall Street's expectations, the TV channel writes. It jumped 30% year-on-year to $2.83 billion. Investment banking revenues also exceeded forecasts, increasing by 21%.

Revenue from all BofA trading operations grew 13% to $6.4 billion.

- The bank's total revenue added 6% to reach $30.43 billion against expectations of $29.93 billion, CNBC reported.

- BofA's earnings per share amounted to $1.11 against LSEG's forecast of $1 and turned out to be the highest in almost two decades, the channel points out. Net income increased by 17% to $8.6 bln.

- Net interest income, a key source of revenue for banks, rose 9% to $15.9 billion, also exceeding expectations. The jump was driven by higher loan and deposit volumes, revaluation of fixed-income assets and activity in the markets, BofA explained.

"It's a very favorable environment for client activity right now," Chief Financial Officer Alastair Borthwick said in a call with reporters, noting particularly notable growth in the bank's international trading operations and commodities trading.

Shares of Bank of America jumped 2.8% in opening trading on April 15, before slowing down to remain up 0.7% at the time this text was published.

- Equity trading at Morgan Stanley also showed a record first quarter. Revenue from this area increased by 25% compared to the same period last year and amounted to $5.15 billion. Total revenue from trading operations reached $10.7 billion, they brought in $1 billion more than expected, notes CNBC.

- The key wealth management unit attracted $118.4 billion in net new assets - more than Wall Street had forecast, Bloomberg reports.

"We often get asked a lot of questions about 'good' and 'bad' volatility, said CFO Sharon Yeshaya, referring to market fluctuations, "This was primarily an opportunity for us to demonstrate our expertise in advising clients."

- In Investment Banking, revenues rose 36% to $2.12 billion on the back of increased M&A activity.

- Morgan Stanley's total revenue in the reporting period increased 16% year-over-year to a record $20.58 billion versus an expected $19.72 billion, CNBC writes.

- The bank's first-quarter earnings per share came in at $3.43 versus LSEG's forecast of $3, the TV station reported. Net income added almost 29% and reached $5.6 bln.

Morgan Stanley shares were up 4.5% in trading on April 15.

This article was AI-translated and verified by a human editor