(Reuters) – Bank of America (BofA) reported a fall in fourth-quarter profit on Friday due to a $3.7 billion charge to replenish a fund government deposit insurance.
The second-largest U.S. bank posted net profit of $3.1 billion, or 35 cents per share, for the three months ending Dec. 31, compared with $7.1 billion in the same period last year, or 85 cents per share.
Its quarterly net interest income (NII) – the difference between what banks earn on loans and what they pay for deposits – fell 5% to $13.9 billion, as the company spent more to hold customer deposits, while demand for loans remained weak due to high interest rates.
Several major banks are required to pay several billion dollars to replenish the Federal Deposit Insurance Corporation’s deposit insurance fund, which was gutted after the failure of Silicon Valley Bank and Signature Bank last year.
(Written by Mehnaz Yasmin in Bangalore, Gaëlle Sheehan, edited by Kate Entringer)
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