Brian Moynihan, Chairman and CEO of Bank of America, speaks with David Rubenstein, President of the Economic Club of Washington, during an event at The Ritz-Carlton in Washington, DC, on February 25, 2025.
Anna Moneymaker | Getty Images
bank of america The company on Wednesday posted a sharp drop in profits after being fined $1.2 billion by U.S. regulators, but its revenue also disappointed, with revenue from its trading business about $750 million less than expected.
The bank’s shares fell about 7% in early trading.
Here’s what the company reported:
Earnings per share: 91 cents, which may not compare to LSEG’s estimate of $1.10 Earnings: $30.12 billion vs. LSEG’s estimate of $30.69 billion
The bank’s third-quarter profit fell 17% to $6.93 billion, or 91 cents per share. Excluding the penalty, which took away 17 cents of revenue, EPS would have been $1.08 per share.
Companywide revenue for the quarter rose 3.2% FTE to $30.12 billion, about $570 million less than expected, primarily due to failures in Wall Street trading operations.
Fixed income trading revenue fell 17% to $2.55 billion due to weaker mortgage, municipal and credit activity. That’s about $450 million below StreetAccount estimates.
Equity trading revenue rose 10% to $2.51 billion, also nearly $300 million less than analysts expected.
The trading disappointment comes after CEO Brian Moynihan told analysts last month that trading revenue would be roughly flat. Instead, combined bond and stock trading results fell by 5%.
Investment banking revenue fell 11% to $1.8 billion, roughly in line with expectations and Mr. Moynihan’s September outlook.
“The worst in the class”
In a research note published Wednesday, Wells Fargo analyst Mike Mayo said the company’s capital markets performance was “by far the worst” of the quarter.
Bank of America’s net interest income, a key factor investors watch for profitability, rose 7.9% to $16.6 billion, slightly above Street estimates of $16.53 billion.
The episode, in which the Treasury Department said the company failed to report billions of dollars of suspicious transactions to U.S. regulators, is bound to raise questions about whether Mr. Moynihan is in control of the nation’s second-largest bank by assets.
Moynihan took office in 2010 and spent his early years in office making amends for mortgage-related abuses after the 2008 financial crisis. Now, the question arises whether there are further risk management issues waiting to be discovered.
The Treasury fines announced on Tuesday added an 11th-hour intrigue to what had been a routine banking week. on tuesday, JP Morgan Chase, goldman sachs, citygroup and wells fargo For the first time in several years, JPMorgan reported mixed results, with EPS and sales coming in below expectations.
Correction: Bank of America reported third-quarter revenue of $30.12 billion on an FTE basis, while LSEG’s estimate was $30.69 billion. Previous versions incorrectly stated the comparison.
