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NIM Down at BoA


Tyler Durden, Zero Hedge, Bank of America Profit Tumbles 19% As NIM Hits Record Low, EPS “Beat” On Surge In Cost-Cutting, here.

The problem observed with other banks, namely the collapse in Net Interest Margin was evident at BofA too, which reported a Net Interest Yield of only 2.03%, the lowest on record. As a result, net interest income fell 12% to $9.21 billion from $10.46 billion a year ago.

BofA, however, is hopeful that long-end rates will rebound, and reported that a +100 bps parallel shift in interest rate yield curve is estimated to benefit NII by $7.5B over the next 12 months. Now if only long-yield were to rebound.

Something else BofA did that was also observed at JPM: increasing total loans – which rose to $900 billion – to offset the decline in margins, coupled with another increase in total deposit.


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