Bank of America’s wealth management unit reported a modest increase in profits and a surge in advisor productivity, but the bank suffered a net loss for the quarter as litigation expenses related to the financial crisis rose to $6 billion.

"The cost of resolving more of our mortgage issues hurt our earnings this quarter,” said CEO Brian Moynihan in a statement. “But the earnings power of our business and customer strategy generated solid results and we continued to return excess capital to our shareholders."

The bank’s Global Wealth & Investment Management unit, also known as GWIM, reported profits of $729 million for the first quarter of 2014, an increase of 1.1% over the $721 million for the same period a year earlier.

GWIM’s revenues also rose to $4.5 billion from $4.4 billion for the year-ago period, a 3% increase.


Assets under management grew 13% to $841 billion from $745 billion. Return on allocated capital decreased to 24.7% from 29.38%.

The number of financial advisors remained unchanged from the previous quarter at 15,323, but was down compared to the same period a year earlier when GWIM employed 16,065


However, GWIM’s advisors are generating more revenue. Average advisor productivity surged to $1.056 million in revenue for the quarter from $971,000 for the same period a year ago.

Ultra-high-net worth brokerage U.S. Trust, part of GWIM, had its highest advisor headcount at 282 advisors since 2009. U.S. Trust’s revenue grew to $768 million, a 6.5% increase year-over-year and the highest revenue reported for the unit since the fourth quarter of 2008.

GWIM, which also includes Merrill Lynch Wealth Management, was the third most profitable business segment for the Charlotte, N.C.-based company, following Bank of America’s Consumer & Business Banking and Global Banking units.


Bank of America reported a net loss of $276 million for the quarter, down from $1.4 billion for the year-ago period due to litigation expenses and sagging mortgage originations. The company’s total revenues fell 2.7% to $22.5 billion from $23.1 billion.

Revenue for Bank of America’s consumer real estate unit fell to $1.192 billion from $2.312 billion for the year-ago period.

Earnings-per-diluted share fell to $0.05 per share from $0.1.

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