Bank of America CEO Brian Moynihan said Wednesday that the banking giant's Street-beating earnings from last quarter didn't include the boost it expects once the Federal Reserve begins raising interest rates.
"Our driver of rate increases ... has not come through yet. That's ahead of us," the chairman and CEO of Bank of America (NYSE:BAC) told CNBC. "We'll get a lot of leverage."
The Fed is expected to raise interest rates aggressively in 2022 as the central bank looks to tamp down inflationary pressures. Banks, like BAC, tend to benefit from higher-rate environments.
Early Wednesday, Bank of America (BAC) announced a quarterly profit that topped analysts' expectations, boosted by 10% revenue growth. Expenses rose 6% during the quarter, but Moynihan attributed that increase to higher compensation at its markets-related businesses.
The BofA CEO added that he plans to keep expenses in line for 2022, projecting a flat result compared to the previous year.
Further detailing the outlook for 2022, Moynihan predicted "plenty of room to grow on the long side" of its business, as he sees a robust economy fueling demand for loans.
On his economic forecast, Moynihan pointed to Q4 credit-card spending patterns to buoy his projection of a strong growth year. He noted that consumers spent 30% more in terms of dollars during the quarter, with a 10%-15% increase in transactions.
"Consumers are out doing things. They're doing things a little differently ... [but] consumers continue to spend," he observed.
BAC edged slightly higher on Wednesday following the release of its earnings report. The stock finished at $46.44, a gain of 18 cents on the session.
Overall, BAC reached a 52-week high of $50.08 earlier this month but has come slightly off that peak headed into the earnings report.
Even as it has tailed off a bit recently, BAC remains an outperformer compared to the broader market. Over the past year, the stock has climbed about 40%, compared to a gain of about 23% for the S&P 500, as you can see from this chart.