Boston, MA 10/15/2014 (wallstreetpr) – Bank of America Corp (NYSE:BAC) is seen inching up by nearly 1% during pre-market hours after it succeeded in beating analysts’ expectations in its third quarter financial performance. The cost control measures reflected some positive on the bank’s performance, despite the burden of large legal charges.
Cost Control In Play
The Earnings per share of Bank of America Corp (NYSE:BAC) came in at minus $0.01, which is far better than the Street’s expectation of a loss of $0.09 per share. Despite a litigation related charge of $5.6 billion, the bank was able to pull itself a profit of $168 million. The same compares to the bank’s performance in the same quarter previous year, when it reported $2.5 billion profit. The legal charge back in the previous year was just $1.1 billion. However, the revenues of the bank fell by 1.5% to 21.21 billion, not satisfying the estimate of $21.36 billion.
Over the last few quarters, the legal charges have taken a toll on the performance of Bank of America Corp (NYSE:BAC). It has paid out billions of dollars to settle various cases pending against it. The latest of the settlement is valued $16.65 billion that the bank agreed to pay the Justice Department for its role in selling faulty mortgage securities during the financial crisis. Other than the legal charges, the bank continues to confront trading weaknesses in its currencies, commodities and fixed income arms.
Change Of Focus
Since the revenue scenario remains weak, the banks have been employing various cost control measures to stay afloat. Bank of America Corp (NYSE:BAC) to reduced its workforce by 2% over the previous quarter. The full-time employees count of the bank in the third quarter is 229,538, reflecting a 7% decline year-over-year. Off late, the bank’s CEO and Chairman, Brian Moynihan, has been taking steps to simplify the bank operations and make it more profitable. The strategy stands in sharp contrast to its predecessors, who undertook aggressive expansion plans.