Bank of America (BAC) said early Thursday that its net income fell 11% in the fourth quarter of 2014 to $3.05 billion, or $0.25 per share, from $3.44 billion, or $0.29 per share, a year earlier. Its total revenue dropped close to 13% to $18.96 billion.
The results, which missed analysts’ estimates, included three one-time items tied to the valuation of debt and other underlying securities and reduced the Q4 earnings by $0.07. BofA’s fixed-income trading dropped dramatically to $1.5 billion from $19 billion a year earlier.
“In 2014, we continued to invest in our businesses while reducing expenses and resolving our most significant litigation matters,” said CEO Brian Moynihan, in a press release. “Last quarter, consumer deposits and loan originations were solid; wealth-management client balances grew to $2.5 trillion; we increased lending to middle-market and large companies; and we retained a leadership position in investment banking.
BofA’s stock traded down about 4.5% on Thursday afternoon, near $15.30.
Global Wealth and Investment Management boosted revenue 3% from a year ago to $4.6 billion, “driven by higher noninterest income with record asset management fees, partially offset by lower transactional activity,” according to BofA-Merrill Lynch. (Merrill Lynch revenue accounted for $3.8 billion, or 83%, of total wealth management sales.
Noninterest expenses, though, grew 5% to $3.4 billion, tied to higher revenue-related incentive compensation and support costs. This contributed to a 9% drop in net income for the unit to $706 million in Q4.
Merrill Lynch’s wealth unit had a 2014 pre-tax margin of 25%, according to its recent earnings report, and a 23% margin in Q4’14.