Summary List Placement
The bank’s $20.3 billion in total Q3 2020 revenues marked a 9% drop from Q2 2020 and an 11% drop year over year (YoY), which it attributed to low interest rates and increased pandemic-related operating and litigation costs. But in a positive sign that BofA is expecting better times ahead for its consumer lending business, it set aside $1.39 billion for loan losses, which is far lower than the $5.12 billion it set aside in Q2 2020.
Digital and mobile consumer banking user growth YoY slowed relative to last quarter, but BofA’s continued digital investments appear to be paying off in terms of driving engagement. Digital (mobile and/or desktop) banking users grew just 3% YoY to reach 39.3 million, versus 5% YoY in Q2 2020.
And mobile users grew 7% YoY to 30.6 million, versus 9% YoY last quarter. This suggests that BofA may be nearing a saturation point when it comes to digital, and will need to double down on satisfying current users to keep them coming back. Robust digital engagement across several metrics points to success in that area so far. Here are two highlights:
Activity on digital channels remains strong, with 2.3 billion digital banking logins. This matches the number of logins from Q2. And while YoY growth in average logins per user (5%) declined from Q2 (14%), the continued growth suggests that the pandemic remains a good time for new product discovery: BofA reported a record high of 688,000 digitally scheduled appointments, as well as 813,000 new mobile check deposit users. Twenty percent of the latter were baby boomers, a demographic traditionally less inclined to use mobile banking—and ongoing interest (22% of Q2’s 1 million new mobile check deposit users were in the demographic) could translate to continued mobile banking usage.
Users of BofA’s virtual assistant Erica hit 15.9 million, up from 14.4 million last quarter. Pre-pandemic, Erica was primarily equipped to assist with budgeting. Those features could be especially useful amid the pandemic’s economic fallout. But in the past seven months, BofA has gone a step further to bolster Erica’s capabilities: It trained the assistant to recognize 60,000 pandemic-related terms and inquiries, and also upgraded Erica with the ability to provide information on Merrill Lynch portfolio balances and trading activity. The result is a more streamlined remote banking experience for customers who still want to limit branch visits, and the uptick in Erica’s usage makes clear that the upgrades are bearing fruit.
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Source:: Business Insider