Bank of America Stands Out From the Pack

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Bank of America has so far seen the biggest share-price boost from earnings among the megabanks. WSJheard explains why. WSJWhatsNow

on mortgages fell. The bank also put a good amount of deposits to work into the market at better rates than cash.

The bank’s expected sensitivity benefit to rising rates in the future is diminishing: It now estimates a $7.2 billion benefit from a 1 percentage-point-across-the-board jump in rates, compared with a $10.5 billion estimate at the end of last year. But like peers it is still growing its liquidity sources and is still comfortably above minimum capital requirements, giving it flexibility to continue to put money to work when the environment is even better.

Bank of America was willing on Thursday to give strong indications of its net interest income outlook next year. Chief Financial Officer Paul Donofrio told analysts on Thursday that if rates move as markets currently expect them to, and if deposits and loans continue to grow to some degree, the bank should see net interest income “well above” what it will have generated in 2021.

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