BANK OF AMERICA CORP /DE/ (BAC): Results of Operations and Financial Condition
BANK OF AMERICA CORP /DE/ (BAC) filed an SEC Form 8-K — Results of Operations and Financial Condition. 1 3Q26 Financial Highlights3(C) 3Q26 Business Segment Highlights1,3,4(C) Consumer Banking • Net income of $3.5 billion • Revenue of $11.6 billion, up 4% • Average deposits of $949 billion, up $1 billion, were modestly higher and up 32% from pre-pandemic levels (4Q19); #1 in U.S.
How this was made
The 30-second read
Why it matters
The earnings miss and settlement charge are likely to trigger a short‑term sell‑off, while strong deposit growth and AI initiatives may mitigate longer‑term concerns.
Market read
First‑report earnings release for a major U.S. bank; immediate market relevance for traders and investors.
What to watch
AI investment progress and continued deposit growth may support longer‑term outlook despite the near‑term earnings miss.
Bank of America Reports 3Q26 Net Income of $6.9 Billion; EPS of $0.91
Revenue, net of interest expense, rose 3% and net interest income rose 8%, with loan growth across every business segment and improved credit metrics. Reported net income fell to $6.9 billion from $8.3 billion because of a $1.2 billion non-tax-deductible regulatory settlement charge, while Global Markets revenue and investment banking fees declined.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenue, net of interest expense, 3Q26GAAP | $30B | – | up 3% |
| Total revenue, net of interest expense, FTE, 3Q26non-GAAP | $30.1B | – | – |
| Net interest income, 3Q26GAAP | $16.4B | – | up 8% |
| Net interest income, FTE, 3Q26non-GAAP | $16.6B | – | up 8% |
| Net interest yield, FTE, 3Q26non-GAAP | 2.16% | – | increased 15 bps |
| Provision for credit losses, 3Q26GAAP | $1.3B | decreased from $1.4 billion in 2Q26 | relatively flat to 3Q25 |
| Noninterest expense, 3Q26GAAP | $19.7B | – | increased $2.4 billion |
| Adjusted noninterest expense, 3Q26non-GAAP | $18.5B | – | – |
| Pretax income, 3Q26GAAP | $9B | – | – |
| Adjusted pretax income, 3Q26non-GAAP | $10.2B | – | – |
| Net income, 3Q26GAAP | $6.9B | – | – |
| Adjusted net income, 3Q26non-GAAP | $8.1B | – | – |
| Diluted earnings per share, 3Q26GAAP | $0.91 | – | – |
| Adjusted diluted earnings per share, 3Q26non-GAAP | $1.08 | – | – |
| Return on average assets, 3Q26GAAP | 0.79% | – | – |
| Adjusted return on average assets, 3Q26non-GAAP | 0.93% | – | – |
| Return on average common shareholders' equity, 3Q26GAAP | 9.4% | – | – |
| Adjusted return on average common shareholders' equity, 3Q26non-GAAP | 11.1% | – | – |
| Return on average tangible common shareholders' equity, 3Q26non-GAAP | 12.6% | – | – |
| Adjusted return on average tangible common shareholders' equity, 3Q26non-GAAP | 14.9% | – | – |
| Efficiency ratio, 3Q26GAAP | 66% | – | – |
| Adjusted efficiency ratio, 3Q26non-GAAP | 62% | – | – |
| Net charge-offs, 3Q26GAAP | $1.3B | decreased $63 million from 2Q26 | decreased $18 million from 3Q25 |
| Net charge-off ratio, 3Q26other | 0.44% | decreased 2 bps vs. 2Q26 | decreased 3 bps vs. 3Q25 |
| Allowance for credit losses, period-endGAAP | $14.2B | – | – |
| Nonperforming loans and leases, period-endGAAP | $5.5B | decreased $207 million from 2Q26 | increased $197 million from 3Q25 |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Consumer BankingDriven primarily by higher NII. | $11.6B | – | up 4% |
| Global Wealth and Investment ManagementHigher asset management fees, up 16% to $4.5 billion, reflecting higher market valuations, strong AUM flows and higher NII. | $7.1B | – | up 13% |
| Global BankingHigher NII and treasury service charges were offset by lower investment banking fees. | $6.2B | – | relatively flat |
| Global MarketsLower sales and trading revenue and investment banking fees. | $5.9B | – | decreased 6% |
| All OtherAll Other primarily consists of asset and liability management activities, liquidating businesses and certain expenses not otherwise allocated to a business segment. | ($643) million | – | – |
Capital returns
- Returned $8.3 billion to shareholders
- $2.2 billion through common stock dividends
- $6.0 billion in common stock repurchases
- Dividends paid of $0.32 per common share in 3Q26
What drove it
- Higher loan and deposit balances, higher NII related to Global Markets activity and fixed-rate asset repricing supported NII.
- Average loans and leases increased 6%, with growth across every business segment.
- Consumer combined credit and debit card spend increased 8% to $266 billion.
- GWIM asset management fees rose 16% to $4.5 billion, supported by higher market valuations, strong AUM flows and higher NII.
- Global Banking average loans and leases increased 8%, while average deposits increased 6%.
- Equities revenue increased 11% to $2.5 billion, driven by increased client financing activity, particularly in Asia and the U.S.
- Asset quality continued to improve, with the credit card charge-off rate at 3.22% versus 3.46% in 3Q25 and 3.55% in 2Q26.
Concerns
- The Corporation recorded a non-tax-deductible regulatory settlement charge of $1.2 billion related to civil money penalties resulting from regulatory consent orders.
- Reported net income was $6.9 billion versus $8.3 billion in 3Q25.
- Global Markets sales and trading revenue decreased 5% to $5.1 billion.
- FICC revenue decreased 17% to $2.6 billion.
- Total Corporation investment banking fees, excluding self-led, decreased 11% to $1.8 billion.
- Global Markets noninterest expense increased 8% and its efficiency ratio was 72%.
- CET1 capital decreased $3.2 billion from 2Q26 and the standardized CET1 ratio was 10.9% versus 11.2% in 2Q26.
What to watch
- Net interest income and net interest yield following 3Q26 NII of $16.4 billion and FTE net interest yield of 2.16%.
- Whether loan growth continues across every business segment after average loans and leases increased 6%.
- Credit performance, including the credit card charge-off rate, nonperforming loans and leases, and reserve releases.
- The trajectory of FICC revenue after the 17% decline to $2.6 billion.
- Investment banking fees after Total Corporation investment banking fees, excluding self-led, declined 11% to $1.8 billion.
- Expense discipline and efficiency following the regulatory settlement charge and 3Q26 reported efficiency ratio of 66%.
- CET1 capital and the standardized CET1 ratio, which were $198.4 billion and 10.9%, respectively.
Balance sheet and cash flow
- Total assets of $3,427.7 billion
- Total loans and leases of $1,251.3 billion
- Total deposits of $2,038.8 billion
- Average loans and leases of $1.23 trillion increased 6%
- Average deposit balances of $2.02 trillion increased 2%
- Long-term debt of $318.7 billion
- Average Global Liquidity Sources of $914 billion
- CET1 capital of $198.4 billion
- CET1 ratio of 10.9% (Standardized)
- Book value per common share of $39.26
- Tangible book value per common share of $29.14
Analysis
Bank of America reported 3Q26 revenue, net of interest expense, of $30.0 billion, up 3% from $29.0 billion in 3Q25. Net interest income increased 8% to $16.4 billion, supported by higher loan and deposit balances, Global Markets activity and fixed-rate asset repricing. FTE net interest yield increased 15 basis points to 2.16%. Average loans and leases increased 6% to $1.23 trillion, with growth across every business segment, while average deposits increased 2% to $2.02 trillion.
Reported profitability was affected by a $1.2 billion non-tax-deductible regulatory settlement charge. GAAP net income was $6.9 billion and diluted EPS was $0.91, compared with $8.3 billion and $1.04 in 3Q25. Excluding the charge, adjusted net income was $8.1 billion and adjusted EPS was $1.08. The charge also lifted reported noninterest expense to $19.7 billion and the efficiency ratio to 66%; adjusted noninterest expense was $18.5 billion and the adjusted efficiency ratio was 62%.
The business mix was led by Consumer Banking and GWIM. Consumer Banking revenue rose 4% to $11.6 billion on higher NII, while combined credit and debit card spend increased 8% to $266 billion and consumer investment assets rose 14% to $664 billion. GWIM revenue rose 13% to $7.1 billion, led by a 16% increase in asset management fees to $4.5 billion. Global Banking revenue was relatively flat at $6.2 billion as higher NII and treasury service charges offset lower investment banking fees. Global Markets revenue decreased 6% to $5.9 billion, with FICC revenue down 17% to $2.6 billion, partly offset by an 11% increase in equities revenue to $2.5 billion.
Credit indicators improved sequentially and in several cases year over year. Net charge-offs were $1.3 billion, down $18 million from 3Q25 and $63 million from 2Q26, while the net charge-off ratio declined to 0.44%. The credit card charge-off rate was 3.22%, versus 3.46% in 3Q25 and 3.55% in 2Q26. Nonperforming loans and leases were $5.5 billion, up $197 million from 3Q25 but down $207 million from 2Q26. The company reported a net reserve release of $80 million.
Capital returns remained substantial, with $8.3 billion returned to shareholders through $2.2 billion of common stock dividends and $6.0 billion of common stock repurchases. Period-end total loans and leases were $1,251.3 billion and deposits were $2,038.8 billion. CET1 capital was $198.4 billion and the standardized CET1 ratio was 10.9%, while the company described the ratio as well above the regulatory minimum. The filing did not provide forward financial guidance.
Management, verbatim
The team delivered organic growth, deepening client relationships and adding new ones. While investment banking and sales and trading revenues were lower, commercial lending grew in every client segment. Our momentum, reflected in growth in client deposits, wealth flows and consumer activity, supported solid earnings, balance-sheet growth and long-term shareholder value.
Brian Moynihan, Chair and CEO
Our disciplined investments in AI are helping teammates serve clients better, work faster and manage risk more effectively. With more than 200,000 teammates using AI tools and 300-plus approved use cases across the company, we are turning our scale into a competitive advantage.
Brian Moynihan, Chair and CEO
We saw healthy activity from our consumer, wealth management, business and commercial clients. Organic growth helped drive higher revenue and solid earnings. Net interest income grew 8% from last year, supported by continued year-over-year and sequential improvement in net interest yield, while asset management fees rose 17%. Asset quality continued to improve and liquidity and capital remained strong. This helped enable us to invest for growth and return $8.3 billion to shareholders through common stock dividends and share repurchases.
Alastair Borthwick, Executive Vice President and CFO
Not in the filing
stated, not guessed- Forward revenue guidance
- Forward net interest income guidance
- Forward expense guidance
- Forward tax-rate guidance
- Forward credit-loss guidance
- Forward capital-return guidance
- Gross margin, which is not a reported banking metric in the filing
- Operating cash flow
- Free cash flow
- Prior outlook for comparison
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
Bank of America’s 8‑K provides the first public disclosure of its 3Q26 financials, including a regulatory settlement charge and mixed segment performance.
Ticker impact
Bank of America filed its 8‑K reporting 3Q26 results, disclosing net income of $6.9 B, EPS $0.91 and a $1.2 B regulatory settlement charge.
downward pressure as investors price the earnings shortfall and settlement charge
The disclosed numbers are worse than the prior quarter and include a material $1.2 B charge, which typically triggers a sell‑off in the short term.
Market effects
Banking sector may see modest weakness as a major peer reports a earnings miss and settlement charge.
U.S. financial stocks could face short‑term pressure in early trading.
Limited to U.S. markets; no immediate global macro effect.
Counterpoint
If the settlement charge is viewed as a one‑off and the deposit growth remains strong, the stock could rebound on the back of solid balance‑sheet metrics.
Key entities
- companyBank of America Corp.
U.S. bank reporting 3Q26 results.
- executiveBrian Moynihan
Chair and CEO who commented on the results.
