NEW YORK (TheStreet) -- Bank of America (BAC) reported fourth-quarter earnings on Wednesday before the opening bell. TheStreet's Jim Cramer explains why it's a top pick going forward. 

Bank of America beat on top- and bottom-line estimates, just as Wells Fargo (WFC) and JPMorgan Chase (JPM) did Tuesday. 

And although the Action Alerts PLUS portfolio, which Cramer co-manages, is long JPMorgan and Bank of America, Cramer prefers Bank of America.

He explained that Bank of America's net-interest margins (NIM) are on the rise, along with noninterest income (fees). 

Furthermore, the banking giant is offering its five-year CD at 0.8%. Subsequently, it can invest those funds at a much higher rate, Cramer said. 

He suggested the unusual spike in litigation "will go down" and found nothing in the earnings report that "perturbed" him. 

For all of these reasons, Cramer made Bank of America his top in the sector. He concluded that investors should not expect a big dividend increase, however, because he said that is up to the Federal Reserve, not management. 

-- Written by Bret Kenwell in Petoskey, Mich.

At the time of publication, Action Alerts PLUS, which Cramer co-manages as a charitable trust, was long JPMorgan Chase and Bank of America.

Bret Kenwell currently writes, blogs and also contributes to Robert Weinstein's Weekly Options Newsletter. Focuses on short-to-intermediate-term trading opportunities that can be exposed via options. He prefers to use debit trades on momentum setups and credit trades on support/resistance setups. He also focuses on building long-term wealth by searching for consistent, quality dividend paying companies and long-term growth companies. He considers himself the surfer, not the wave, in relation to the market and himself. He has no allegiance to either the bull side or the bear side.

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