U.S. consumers are spending more money while also growing savings in a positive sign for the economy, according to Bank of America CEO Brian Moynihan.
Moynihan told CNBC’s Jim Cramer on Wednesday that spending on Bank of America cards has jumped by as much as 20% from last year.
“When you look at the core spending levels of consumers, they continue to be very strong,” Moynihan said. “January’s up nearly 15 to 20% [from a year earlier]; we’re seeing that continue into February.”
Bank of America is the second-biggest U.S. bank by assets, after only JPMorgan Chase. Its relationships with U.S. households, small businesses and corporations give Moynihan a unique view into the health of the economy.
While there was concern that consumer bank account balances would plunge after government stimulus programs ended, that hasn’t been the case yet, Moynihan said. Instead, balances have risen for the “last six or seven months,” according to the CEO.
“The second thing is that consumers have more money in their account,” Moynihan said. “So in the month of January their accounts grew again, especially for consumers that carry lower balances.”
Moynihan said that his bank was poised to generate more earnings in a rising rate environment. The Federal Reserve is expected to start hiking its benchmark rate next month.
The wide-ranging interview covered the bank’s technology investments. As of last month, Bank of America had 16 million active Zelle users, and last year Zelle transactions exceeded paper checks for the first time.
This story is developing. Please check back for updates.
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