NEW YORK (CNN/Money) -
Lehman Bros. and Bear Stearns both reported Wednesday that profits soared for the latest quarter, trouncing forecasts on Wall Street, as the brokerages got a lift from low interest rates and strength in the bond business.
New York-based Lehman reported net income of $481 million, or $1.71 a diluted share, for its fiscal fourth quarter, compared with $187 million, or 69 cents a share, a year earlier.
Analysts had forecast net income of $1.57 a share, according to analysts polled by Reuters.
Low interest rates helped buoy Lehman's debt underwriting and trading businesses.
Revenue from transactions for its own account nearly doubled to $1 billion, Lehman said, while investment banking revenue rose 19 percent.
Shares of Lehman (LEH: Research, Estimates) jumped $2.16 to $74.56 on the New York Stock Exchange Tuesday.
Separately, Bear Stearns Cos. reported quarterly profit soared 51 percent, helped by strength in its bond business and a jump in securities underwriting.
The New York-based brokerage reported fourth quarter net income of $288 million, or $2.19 a share, up from $190.5 million, or $1.36 a share, a year earlier.
"Our fixed-income division continues to deliver exceptional results with strong performance across our mortgage, credit and interest rates products areas,'' Chairman and CEO James Cayne said in a statement.
Wall Street analysts, on average, had expected the firm to report net income of $1.81 a share, according to analysts polled by Reuters.
Low rates also helped Bear Stearns, which is one of the biggest underwriters of debt, much of it in a mix of residential mortgage debt, asset-backed debt, emerging markets debt and corporate debt -- both high-grade and high-yield.
Revenue from the fixed-income unit rose 40 percent to $649 million.
A one-time gain of about $34 million from the sale of an investment in clothing chain Aeropostale Inc. helped the results.
-- Reuters contributed to this report
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