(Reuters) -Robinhood Markets reported a profit in the first quarter on Wednesday compared with a loss last year, helped by strong trading volumes and rate hikes that boosted its net interest revenue.
The company reported a profit of $157 million or 18 cents per share for the three months ended March 31, compared with a loss of $511 million or 57 cents per share a year ago.
Policy tightening by the Federal Reserve has allowed companies to increase earnings from their cash deposits and their portfolio of bond investments.
Brokers like Robinhood, which offers traders the ability to borrow against their investments, can now charge higher interest rates on these loans.
The company’s net interest revenue jumped 22% to $254 million.
The prospect of a soft landing also spurred retail traders to re-enter the market, leading the Menlo Park, California-based company to achieve a 59% increase in transaction-based revenue.
(Reporting by Sri Hari NS and Niket Nishant in Bengaluru; Editing by Tasim Zahid)
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