After joining the Army in the movie Stripes, the legendary John Candy vowed to emerge a "lean, mean, fighting machine." After glancing at Bank of America's (NYSE:BAC) third-quarter earnings yesterday, it appears the nation's third-largest bank is on track to accomplish that. The integration with FleetBoston (which was acquired in April) continues to proceed on schedule, and the merger produced cost savings of $309 million for the quarter.

With continued strength in consumer banking, earnings jumped 29% to $3.76 billion from $2.92 billion a year ago, though quite a few shares were doled out ($48 billion worth) to complete the acquisition, and dilution dragged per-share gains down by a nickel to $0.91. The bottom-line results (which were aided by a $732 million gain from the sale of mortgage-backed securities) narrowly topped estimates, despite top-line growth that came up short. Revenues jumped 29% to $12.6 billion, with lending income and fee income rising 43% and 10%, respectively.

There has been little evidence of any large-scale customer defection arising from the merger, and new relationships are being added at a healthy clip. Nearly one-third of FleetBoston locations have been "re-branded," and most metrics are either meeting or exceeding internal targets. The number of consumer checking and savings accounts grew by 537,000 and 624,000, with both on pace to top their 2 million goal. The growing customer base helped lift retail deposits 11% (on a pro-forma basis) to $400 billion.

Furthermore, more than 1.6 million new credit card accounts were established, with the help of cross-selling and an effective targeted mailing campaign. Also, more customers are enrolling in Internet banking services, and Bank of America's 11.8 million users drove online bill payment volumes 10% higher through a partnership with CheckFree (NASDAQ:CKFR).

The consumer banking sector posted a 27% increase in revenues to $7.03 billion, representing more than half of the bank's total revenues. Rival Citigroup (NYSE:C) also reported strength from retail operations as profits from the company's global consumer division jumped 23% on a 15% rise in revenues. Bank of America's net segment income, however, was essentially flat at $1.68 billion as lower mortgage origination volume resulted in a $250 million loss from mortgage banking, versus a prior-year gain of $666 million.

Bank of America's other business segments helped pick up the earnings slack. Net income derived from commercial banking doubled to $824 million, while earnings from global corporate/investment banking and wealth management rose to $475 million (up 9%) and $469 million (up 83%), respectively. During the quarter, the company took the lead in the underwriting of mortgage-backed bonds.

Whether or not Bank of America overpaid for FleetBoston is open to debate, and merger-related charges are likely to linger in the near term. However, in the consolidating banking industry, bigger is better. And Bank of America's coast-to-coast geographic footprint, 33 million consumer accounts, and $1.1 trillion in assets stack up well next to giants such as Citigroup and J.P. Morgan Chase (NYSE:JPM).

Furthermore, reduced expenses from job cutbacks, streamlined operations, and other synergies are ultimately expected to yield $1 billion in cost savings. With continued momentum in consumer banking, signs of traction in commercial lending, improving credit quality, and a rising dividend, Bank of America, at less than 12 times trailing earnings, may be a good place to deposit your investing dollars.

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Fool contributor Nathan Slaughter owns none of the companies mentioned.