Bank of America’s Earnings Are Coming. What to Expect.

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Eyes are on

Bank of America

next to see if its first-quarter results match the better-than-expected reports from peers.

Expectations are somewhat mixed for Bank of America (ticker: BAC) headed into Tuesday’s print. Like

JPMorgan Chase

(JPM) and other banks that posted results Friday, Bank of America is forecast to see a surge in net interest income thanks to the Federal Reserve’s rate hikes over the past year. But predictions for Bank of America’s bottom line are more muted, with analyst forecasting a drop in the bank’s profits compared to JPMorgan posting a 52% gain.

Wall Street sees profit at the Bank of America totaling $6.7 billion or 81 cents a share, down from $7.1 billion in the year-ago quarter, according to analysts surveyed by FactSet. Revenue is projected to climb 8.6% to $25.2 billion, helped by an anticipated 23.3% jump in net interest income—to $14.3 billion—according to FactSet.

Bank earnings have taken the spotlight this quarter after runs at Silicon Valley Bank and

Signature Bank

caused them to collapse last month. JPMorgan Chase,

Citigroup

(C), and

Wells Fargo

(WFC) posted better-than-expected financial results last week, easing worries about the health of the banking system. 

Those large banks have held up reasonably well during the upheaval as they have seen a surge of deposits in the last weeks of the first quarter as savers looked for safer places to park their next eggs. Bank of America is expected to see a similar surge in deposits.

While large banks have been beneficiaries of the recent turmoil, they must also contend with an economy that is weakening. Other banks that have since posted results have seen year-over-year increases in net charge offs—or debts that have been written off—and have built up their reserves in anticipation of a wave of defaults as customers become strained by financial conditions.

Goldman Sachs

(GS) also posts results before the bell on Tuesday, followed by Morgan Stanley (MS) on Wednesday. 

Write to Carleton English at [email protected]