Bank Earnings Continue to Impress

Bank of New York and BB&T come in solid.
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The list of midsized banks reporting solid first-quarter earnings got longer Thursday with

Bank of New York

(BK) - Get Report

,

BB&T

(BBT) - Get Report

and

PNC Financial

(PNC) - Get Report

joining the parade.

Bank of New York, the nation's oldest bank, reported an 11% gain in net profits. In the quarter, the bank earned $422 million, or 55 cents a share, up from $379 million, or 49 cents a share, in the year-ago period.

Revenue rose 23% to $2.34 billion, fueled by strong gains in securities servicing fees, which is one of the bank's core businesses.

Analysts surveyed by Thomson Financial were looking for earnings of 54 cents a share on revenue of $1.8 billion.

Securities servicing fees rose 11% to $831 million. Net interest income rose 7% to $488 million.

Net interest income is the revenue a bank makes from its lending and deposit operation.

Earlier this month, Bank of New York announced it would sell its retail branches to

JPMorgan Chase

(JPM) - Get Report

in a $3.1 billion asset-swap. The deal, in which Bank of New York will get JPMorgan's corporate trust business, is expected to close later this year.

Southeastern regional lender BB&T also announce strong first-quarter profits on Thursday. The bank reported a 9% gain in net income, outshining Wall Street expectations.

In the quarter, the bank earned $431.5 million, or 79 cents a share, compared to $395 million, or 71 cents a share, in the year-earlier period. The Thomson Financial estimate had the bank earning 76 cents a share.

Net interest income rose a modest 6% to $898 million. But the bank posted an impressive 18% gain in noninterest income to $608 million. The bank attributed the rise in noninterest income to "improved revenues from insurance operations, trust services, investment banking and brokerage fees and commissions.''

Not every bank posted big profit gains on Thursday. Pittsburgh-based PNC Financial said first-quarter profits were unchanged from a year ago.

In the quarter, PNC earned $354 million, or $1.19 a share, compared to $354 million, or $1.24 a share, in the year-ago period. Revenue rose 17% to $1.75 billion.

PNC's results, however, looked better on an operating basis. The year-ago quarter included a $45 million after-tax gain, which added 16 cents a share to earnings.

The bank's first-quarter earnings also came in ahead of analyst expectations. The Thomson Financial estimate had PNC earning $1.17 a share on revenue of $1.68 billion.

Later this year, PNC said it expects to record a $1.6 billion after-tax gain stemming from the deal between

Merrill Lynch

(MER)

and

BlackRock

(BLK) - Get Report

to merge their asset-management businesses. PNC currently is BlackRock's largest shareholder. After the deal, the bank's stake in BlackRock will be sharply reduced.In the first quarter, income from BlackRock accounted for 20% of PNC's earnings.