The FINANCIAL — Bank of America announced their approximately 67 million clients made $294 billion in total payments during February, a 16% increase over February 2021. This follows a 5% increase in total payments in February 2021 when compared to pre-pandemic levels in February 2020. This marks a continuation of the strong consumer payments and spending observed in January, as well as a record $3.8 trillion in total payments in 2021.
“We saw a strong continuation of payment and spending trends in February, another positive sign of the strength of U.S. consumers,” said Mary Hines Droesch, Head of Consumer and Small Business Products at Bank of America. “Strong spending trends across a variety of sectors such as travel, restaurants, public transportation and gym memberships suggest more consumers are returning to the office and resuming more in-person activities.”
Additional February Payments Trends
Bank of America clients’ combined credit and debit card spending reached $63 billion in February, up 21% compared to February 2021.
Total credit and debit transactions were up 15% year-over-year, indicating continued strong demand for goods and services.
Travel spending on credit and debit cards was up 95% year-over-year, with airline spend up 153% year-over-year; and spending at travel agencies up 147%, led by Boomers and Seniors.
Increased spending at coffee shops, dry cleaners and public transportation indicated a greater return to the office in February after a seasonal winter slowdown exacerbated by Omicron. Combined, these categories saw 30% growth year-over-year in February, compared to 21% growth year-over-year in January, according to Bank of America.
Spending at restaurants and gyms was up 38% and 43% respectively in February 2022 vs. February 2021, as clients resumed more in-person activities, with Gen Z/Millennials driving growth.
Gen Z/Millennials spending on additional in-person activities, such as movie theaters, ticket agencies and amusement parks, strongly outpaced other generations – with spending on these activities up 162% year-over-year in February 2022, compared to an increase of 94% among Boomers and Seniors.
Clients continued to gravitate toward convenience when shopping – digital spending on credit and debit was up 22% year-over-year, and adoption of tap-to-pay grew, representing 19% of in-person transactions.
Healthy Deposit Balance Trends Continued in February
Even with the strong growth in spending, Bank of America clients’ deposit balances totaled over $1.4 trillion at the end of February, up 15% from February 2021.
We continued to see growth in deposit balances across all stratifications of deposit customers. Among consumers with an average deposit balance of less than $2,000 before the pandemic, balances were up five times their pre-pandemic levels on average, including an additional 2% growth in February 2022 compared to January 2022.
Deposit balance growth remained strong across all age demographics as well – Millennials were up 61% on average in February compared to pre-pandemic levels in February 2020; deposit balances among Boomers and Seniors were up 38% on average compared to the same period.
Bank of America is a provider of choice for individuals and businesses when paying for goods and services. The company’s award-winning and easy-to-use capabilities help clients budget, save, spend and borrow carefully and confidently. Bank of America reviews aggregate activity across its vast client base to discern important payments trends, including debit and credit spending.
This data represents aggregate spend and deposit balances from Retail, Preferred, Small Business and Wealth Management clients with a deposit account or credit card. Deposit balances include checking, savings accounts, CD/IRA and CMA. Total payments include credit card, debit card, ACH, wires, bill pay, person-to-person, cash and checks. Digital credit and debit card spend includes online and mobile transactions. Data is not adjusted for seasonality, processing days or portfolio changes, and may be subject to periodic revisions. Card transactions are categorized by proprietary methods and the Merchant Categorization Code (MCC) defined by financial services companies.
Certain statements contained in this news release may constitute “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent the current expectations, plans or forecasts of Bank of America based on available information. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. These statements often use words like “expects,” “anticipates,” “believes,” “estimates,” “targets,” “intends,” “plans,” “predict,” “goal” and other similar expressions or future or conditional verbs such as “will,” “may,” “might,” “should,” “would” and “could.” Forward-looking statements speak only as of the date they are made, and Bank of America undertakes no obligation to update any forward-looking statement to reflect the impact of circumstances or events that arise after the date the forward-looking statement was made.
Forward-looking statements represent Bank of America’s current expectations, plans or forecasts of its future results, revenues, expenses, efficiency ratio, capital measures, consumer payments and spending and future business and economic conditions more generally, and other future matters. These statements are not guarantees of its future results or performance and involve certain known and unknown risks, uncertainties and assumptions that are difficult to predict and are often beyond the Bank of America’s control. Actual outcomes and results may differ materially from those expressed in, or implied by, any forward-looking statements. You should not place undue reliance on any forward-looking statement and should consider all of the uncertainties and risks discussed under Item 1A. “Risk Factors” of Bank of America’s Annual Report on Form 10-K for the year ended December 31, 2021 and in any of the Bank of America’s other subsequent Securities and Exchange Commission filings.