Bank of America Wednesday reported higher quarterly profits on lower expenses, although results in key lending operations were mixed.

Earnings for the first quarter were $3.4 billion compared to a loss of $276 million a year ago. The 2014 results were marred by a $6 billion charge for litigation.

Revenues dropped 5.5 percent to $21.42 billion, below the $21.50 billion projected by analysts.

Chief executive Brian Moynihan pointed to record deposits and a strong performance in investment bank advisory fees as positives in the quarter.

Mortgage production revenues were another high point, jumping from $10.8 billion to $16.9 billion thanks to an increase mortgages.

But net income for global markets sank 28 percent to $945 million, due in part to lower trading revenues. Revenues in the closely-watched fixed income trading category dropped seven percent.

Among other segments, BofA reported higher income in global banking, lower income in global wealth and investment management and essentially flat results in consumer banking.

Like other banks, BofA faces a challenge growing earnings in a low interest rate environment.

Total consumer loans fell 8.6 percent from a year ago to $474.5 billion, while total commercial loans rose 1.7 percent to $403.5 billion.

Chief financial officer Bruce Thompson said the results showed some clear signs of improvement in the US economy, such as the increase in mortgage originations and a trend of more companies increasing their borrowing.

But Thompson said the overall pace of growth was still restrained.

"There's a continual grind towards the improvement side," he said. "It's still not where we would like it to be."

Litigation costs in the most recent quarter were $400 million.

The bank cited lower non-interest expenses as a favorable point. Headcount is down nearly eight percent from last year to 219,700.

The results translated into earnings of 27 cents per share, two cents below analyst expectations.

Bank of America dipped 0.4 percent to $15.74 in pre-market trade.