Bank of America’s European banking unit in Dublin reported a 4.2 per cent dip in pretax profit last year to $1.76 billion (€1.63 billion) as it took an impairment charge against its loan book and staff costs rose.
Net interest income rose 13 per cent to $1.23 billion at Bank of America Europe in 2024, mainly as a surge in customer deposits led to it increasing the amount of excess cash it had stored, and earning interest, with central banks rose by a third to more than $23 billion.
Net fee and commission income also rose by a third, to $468 million, reflecting higher activity across its investment banking advisory business and organising corporate loans as part of a group of banks, or what is known as loan syndication.
However, the bank set aside $90 million of provisions to cover potential bad loan losses, more than reversing a $80 million release of such provisions in 2023.
Bank of America chose Dublin as its European Union (EU) headquarters in 2017. The unit, which had an average of 2,549 employees across the Continent last year, has two main divisions: global banking and markets, and a support services division. The US banking giant has had a presence in the Republic since 1968.
Fernando Vicario, who was born in Germany and is a Spanish citizen, is the chief executive of Bank of America Europe and its country officer for Ireland.
Staff costs rose by $29 million to $623 million at the unit last year, even as average employee numbers were unchanged, as an increase in the group’s share price in New York affected expenses on share-based remuneration plans.
Bank of America Europe’s loans to customers edged up to €32.3 billion from €32 billion on the year.
The wider Bank of America group reported earlier this year that its pretax profit rose 3.5 per cent last year to $29.3 billion as its investment bankers capitalised on resurgence in deal making in the fourth quarter while the lender predicted it would earn more interest income in 2025.
While Wall Street banks were predicting earlier this year mergers and acquisition (M&A) activity would rise globally against this year on the back of what they saw as pro-business polices of US president Donald Trump, the global trade war he has unleashed has soured such forecasts.
Bank of America’s share price has fallen by more than 6 per cent so far this year.
