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Bank of America Lifts Profitability Target, Maps Market-Share Push and Signals Succession at Investor Day

The bank used its first investor day since 2011 to couple higher ROTCE goals with continuity under CEO Brian Moynihan.

A Bank of America logo is seen on the entrance to a Bank of America financial center in New York City, U.S., July 11, 2023.  REUTERS/Brendan McDermid/File Photo
A Bank of America logo is pictured in the Manhattan borough of New York City, New York, U.S., January 30, 2019. REUTERS/Carlo Allegri/File Photo

Overview

  • Management set a medium-term return on tangible common equity goal of 16%–18%, above prior mid-teens guidance.
  • The plan calls for gaining 50–100 basis points of investment-banking fee share over three to five years and lifting earnings per share by more than 12%.
  • Trading ambitions include capturing about 9% of industry revenue, up from 7.6%, with net interest income projected to grow 5%–7% annually for five years.
  • Moynihan said he intends to remain through the decade as Dean Athanasia and Jim DeMare take co-president roles and CFO Alastair Borthwick becomes executive vice president.
  • Context for the push: BofA posted a 15.4% Q3 ROTCE versus JPMorgan’s 20%, its consumer unit earned $3.4 billion (about 40% of profit), and the stock drifted down roughly 2% during the event.