What a fantastic start to this year. Now forgive me. With best we've got to ask, can this really continue at this rate?
Oh, you just well, you just saw two statistics that I've watched carefully, which is the activity of consumer and then ultimately what the unemployment claims are. That's that people argue it's leading or trailing, but it's actually the indicator of the health of the employment market and the 4.2% unemployment rate with new claims at 1.8 on long term claims and 208,000. Everybody looks at this as well that's in line with 19. Remember that the workforce has actually grown a lot since 19 terms of size. And so you argue about 7160 million workers or something like that. So it's a pretty small number. It's an anomaly. It's a low number and percentage-wise it's a low number. And that's good news because that means a consumer spending what we see in our data as a consumer. So spending the consumer spend in America, that means economy is okay. And that probably means the rest of the markets in the construct and final demand is there.
The weather for the banking industry has been shining brightly. The sun is out, the backdrop's great. The environment has been good. I want to draw a distinction between the environment and execution because fees are up everywhere. What are you proud of after that quarter on execution where you kind of market share, every single business grew, the revenue grew, operating leverage, which is critical because that means the revenues grow faster than expenses and increase the returns.
Every single business, it grew, the customer bases and all those things. So what you're seeing us is the power that the engine, the Bank of America, is across all the businesses. So our consumer business made 3 billion after tax this quarter. Plus you know that's half as much as Wells Fargo made. And you know it's a big number. That's one of our four businesses that we disclose in the smallest of which made a billion and a half this quarter. So these are big businesses of scale. They're accumulating new clients, accumulating new activity. The markets business had a great quarter and investment banking had a great year over year comparison. But at 2.1 billion for the quarter or 2 billion last quarter, 2.1. It looks like a huge increase because last year, second quarter, we all thought the world was coming to an end with Liberation Day. This year it's different. But what's really important is the pipeline they have is strong. The deal in discussion are strong. And you're seeing deals announced every day across all the spectrums M&A strategy, financing, all of which is important.
Just elaborate on that a little bit more. How strong is this pipeline. Because things just look phenomenal. We've had a record IPO. Alphabet came out with a monster equity capital raise. We saw SK Hynix more recently do something similar. We're going to see more of that in the year ahead.
Yeah I think you know, so if you look at we and all our peers are deploying more balance sheets, our balance sheet to the markets business went up 00 billion for the quarter over what they thought they were going to be at. Just to give you a sense. And so we had that capital base and that capability just to meet the moment. But if you look at investment banking, the deal when you talk to CEOs, because if you think about this time and the amount of things they had to think about, we've added one, with the awards, but at that time it was. Taxes weren't set yet. The immigration policy was the people were trying to figure it out trade trading, tariff policy and then deregulation. You come to the fall. They felt that that was sort of working through whether the tax and the tariff policy kind of looked at and said, that's sort of 10 to 15% of countries willing to do business with United States, and 50 if they're not. I can figure that out. Let me go figure out how to run my business. That comes with a court decision. All the work that's gone around in circles a little bit. So we added some uncertainty. But on top of that, what you added is a year's worth of growth at a year's worth of belief that this year is going to grow 2% plus next year is going to grow 2% plus. That's creating people, convincing people that despite higher energy prices, despite inflation, despite the fed having to keep rates higher, despite all that, the economy is growing through it. That's the interesting part. And I think CEOs last year got cleared on taxes, got clarity on deregulation. Got cleared of the immigration and the now are thinking hard about. Wait. I can do things. I can see a little more distant future. Does that mean there's a parade of possibilities of the change that that's out there every day?
Let's talk about the parade of possibilities. Sorry, I'm a journalist, so I have to. There's this question about how market dependent some of this capital markets activity will be for the rest of this year. The idea that a lot of people are borrowing money they don't even need right now, because the market is so wide open to them. What are the potential thresholds, whether it's in rates or whether it's a selloff in equities that could potentially stymie some of the pipeline? So if we were here a year ago, you'd say
nobody is ever going to get a mortgage at 6.5%. Just to give you a sense, we were 30% up on production mortgages this quarter. So as people get used to environments, they start to behave differently. And so the consumer borrowing is strong. But there's a lot of capacity left. But mortgage production being up 30% is kind of an interesting statistic in a world where if you said rates were going to be a side, it'd be doing mortgage volume. If you go to the commercial side, which is where you were talking about, we're seeing good loan growth, high single digits year over year and a core middle market small business area where the largest small business lender, United States. That's good news because that means back to John's question. That's a little bit that if I'm not going to borrow, if I don't need the money, I'm not going to borrow if I don't need to do something. Despite what people talk about, you're not going to issue debt and increasing interest cost and have just sit there because the arbitrage if you don't issue below treasuries, which these guys no borrower does. You're going to pay 3 or 400 basis points to let money sit there. It's just not going to work. So people are borrowing because they see opportunity where it's equipment buying was hiring lots of building a plant, whether it's inventory build up. And so they're going to be more worried about can they get the margin on that. That's the question of inflation coming through the system later on. They're going to be more worried about will the final demand sit that's watching the consumer behavior of the consumer side driven or if they're in supply chains. Is the demand going to stay there? So I think it's the markets will stay there for a company, see opportunities whether small, medium or large size. And I'll stay there as long as they have something to do with the money. Nobody borrows money just to have a sit around. It's like when people think about Sky bikes and what just happened. I mean, one could say, we've got to have a view or they're going to do something, whether they just paid in the profit margins or whatever they're going to do with it, they're thinking about something.
One thing that you noted, the mortgages is something that Tommy Chau mentioned earlier, and he was saying that you've seen a lot of the traditional financial institutions gain market share back from alternative asset managers. And that's one of the reasons why the regulatory pullback has been so beneficial. Is that been your experience as well?
Well, I think also, the investor money going into the private capital funds and stuff has been slowed in. There's been withdrawals and people getting out. And that didn't slows down the activity. But I think also the questions are raised around how much leverage is too much. And I think if you looked at the average leverage of the different deals, that was different inside the banking system and out. So I think we've seen a little bit of pull push back to the system. And I think we also had to come with competitive responses. So we put together pools that we could we and our peers. And you know, it's to two different pools where we could, when the opportunity was there, hit the bid for the core differences. If we do a $5 billion transaction, we tend to syndicate and get five banks. And that takes time and effort and creates a little bit of uncertainty. The other players are saying, I'll give you all 5 billion, I'll bring you the equity. Plus I bring out that we build a practice where we can do more of that for our good mid-market companies. It's still will be laid off. It just when you lay it off up front or behind. And so we put a couple things between that and the efforts, the industry and the efforts our company, you're seeing some of the market share come back. It's just a lot of factors. But great commercial loans an 8% and that's a pretty good growth rate.
Brian, you continuously measure mention. If we were this time last year, Liberation Day, unsure about tax policy, where the deregulation was going on, immigration policy was going. Are you more focused on Washington now than you have been in the past, because of how pronounced this administration has been on policy? Well, I think where the company's been
around for 242 years. So we've been around through every, every administration that you can name pretty much. So it's so it affects the economy with effects, economy effects, CEO views of what they want to do, all that if that affects us. But I think, you know, so the interesting question is right now is that, you know, if you there's this the say do paradox is as high as ever been. If you read the consumer surveys, it says, I'm worried about the listed out. Look what you just saw in retail sales in the month of June, the money moving out of the Bank of America customer accounts was 7% high sixes. And in July, it was the same strength that's as strong as it was in May and April and March. That is counterintuitive to what the people are. So people are upset about high gas prices, are upset about affordability. That's a fact. That's a fact that may change their behavior. Right now the behavior hasn't changed. And I think that's sort of a parallel to all the things about policy. People talk about it and think about it. But if the underlying business conditions are fine, they just go to work and get through it. And so the question is when does it affect their things when supply chains become uncertain. Because for pricing, because of tariffs they had to slow down and wait it out. Now they've got a kind of figured out and they can pass it through. When the immigration policy meant they might not get workers, they had to think that through. They're used to that now and a lot less immigration. They've rearranged the work supply. You still hear that from our small businesses. That workforce availability is a big issue for, especially with new construction and things like that. And so I think we got to get that rational at some point. But right now there's enough momentum behind it that we're going through it.
