BofA Chairman & CEO Brian Moynihan Talks Deals

**SPEAKER_1** (0:02)
Bloomberg Audio Studios, podcasts, radio, news.

**Jonathan Ferro** (0:07)
Robust data, retail sales are good. That's a decent week of data for this market.

**SPEAKER_3** (0:12)
This is the exact kind of disinflationary productivity boom that everybody's been hoping for that can really be the cherry on top, and highlights how comforting it is to see that equities are a little bit lower, at least from some people's perspective, just because people aren't taking this and running away with it. This is a euphoria that's been built into the market. The question is, how long can we stay in this good kind of backdrop that can really benefit a lot of different businesses?

**Jonathan Ferro** (0:36)
The banks, the financials, are in prime position to leverage this moment.

**Brian Moynihan** (0:40)
Bank of America, the stock is sitting at record highs after delivering blockbuster results.

**Jonathan Ferro** (0:44)
Equity trading revenue rising 70% in the second quarter.

**Brian Moynihan** (0:48)
Fixed income trading climbing nearly nine, making a record first half of the year for the sales and trading division.

**Jonathan Ferro** (0:54)
The Bank of America CEO, Brian Moynihan, is saying against the healthy economic backdrop, resilient consumers and businesses are turning to Bank of America to spend, borrow and invest. Brian, I'm pleased to say, join us now for more. Brian, good morning.

**Brian Moynihan** (1:06)
It's great to be here.

**Jonathan Ferro** (1:07)
It's good to see you, sir. What a fantastic start to this year. Now, forgive me, we're journalists, we've got to ask, can this really continue at this rate?

**Brian Moynihan** (1:15)
Well, you just saw two statistics that I've watched carefully, which is what the activity of the consumer is and then ultimately what the unemployment new claims are.
People argue it's leading or trailing, but it's actually the indicator of the health of the employment market and the 4.2% unemployment rate with new claims at 1.8 on long-term claims and 208,000. Every looks at it and says, well, that's in line with 19 Remember that the workforce has actually grown a lot since 19 in terms of size. And so you argue about 7,000, 160 million workers or something like that, so it's a pretty small number. And so nominally it's a low number and percentage-wise it's a low number. And that's good news because that means a consumer spend. And what we see in our data is a consumer spending. The consumer spend in America, that means economy is okay and that probably means the rest of the markets and the construct and the final demand is there.

**Jonathan Ferro** (2:08)
The weather for the banking industry has been shining brightly. The sun is out, the backdrop is great, the environment has been good. I want to draw a distinction between the environment and execution. Because fees were up everywhere. What are you proud of after that quarter?

**SPEAKER_3** (2:20)
On execution, where are you gaining market share?

**Brian Moynihan** (2:23)
Every single business grew the revenue, grew operating leverage, which is critical, because that means your revenue has grown faster in expenses and increased your returns. Every single business. It grew the customer bases and all those things. So what you're seeing us is the power that the engine of Bank of America is across all the businesses. So our consumer business made 3 billion after tax this quarter.
Plus, that's half as much as Wells Fargo made. And it's a big number. That's one of our four businesses that we disclosed in the smallest of which made a billion and a half this quarter. So these are big businesses. They're scaled. They're accumulating new clients. They're accumulating new activity. The markets business had a great quarter. And the investment banking had a great year-over-year comparison. But at 2.1 billion for the quarter, we were 2 billion last quarter, 2.1. It looks like a huge increase because last year, second quarter, we all thought the world was coming to an end with Liberation Day. This year, it's different.
But what's really important is the pipeline they have is strong. The deals in discussion are strong, and you're seeing deals announced every day across all the spectrums, M&A, strategy, financing, all of which is important.

**SPEAKER_1** (3:30)
Just elaborate on that a little bit more.

**Jonathan Ferro** (3:31)
How strong is this pipeline? Because things just look phenomenal. We've had a record IPO. Alphabet came out with a monster equity capital raise.

**Brian Moynihan** (3:38)
We saw SK Hynex more recently do something similar.

**Jonathan Ferro** (3:41)
Are we going to see more of that in the year ahead?

**Brian Moynihan** (3:43)
Yeah, so if you look at, we and all our peers are deploying more balance sheets. Our balance sheet to the markets business went up $100 billion for the quarter over what they thought they were going to be at, just to give you a sense. And so we had that capital base and that capability just to meet the moment. But if you look at investment banking, when you talk to CEOs, because if you think about last year this time, and the amount of things they had to think about, we've added one with the wars. But at that time, taxes weren't set yet.