Bank of America stock on track for worst day since 2025 as $1.2 billion fine weighs on third-quarter results

Bank of America (BAC) shares fell more than 7% on Wednesday, putting shares of the nation’s second-largest bank on track for their worst one-day move since April 2025, as a $1.2 billion regulatory penalty weighed on results.

The country’s second-largest bank reported third-quarter net income of $6.93 billion, or $0.91 per share, compared with analysts’ expectations of $1.10 per share. Excluding regulatory penalties, Bank of America said it earned $8.1 billion, or $1.08 per share.

Revenue rose 3% to $30 billion, compared with expectations of around $30.6 billion.

U.S. regulators on Tuesday afternoon fined the Charlotte, North Carolina-based bank $1.2 billion for widespread failures in measures to protect the banking giant against money laundering and other illicit financial activities.

Bank of America Chief Financial Officer Alastair Borthwick told reporters Wednesday that much of the spending the bank believes is necessary to address these failures is already reflected in its operating expenses, as it has already dedicated thousands of employees and substantial technology investments to address regulatory deficiencies.

Borthwick declined to say when regulators might officially conclude the remediation process.

Regulatory enforcement orders for big banks can take years. A broader consent order related to a fake accounts scandal at Wells Fargo lasted more than eight years and included a heavy restriction on the bank’s asset growth over that period.

During the company’s earnings call with analysts, CFO Borthwick clarified that there were no restrictions on growth with the consent order.

Bank of America’s results also offer another glimpse into how America’s biggest banks are navigating a quarter marked by a sharp rise in borrowing costs, which supported higher loan revenue while making it harder for some of their businesses to do business on Wall Street.

“While investment banking and sales and trading revenues were down, commercial lending increased across all customer segments,” Bank of America CEO Brian Moynihan said in an accompanying statement.

“Our momentum, reflected by growth in customer deposits, wealth flows and consumer activity, has supported strong earnings, balance sheet growth and long-term shareholder value,” he added.

Bank of America’s net interest income, a key measure of how much the bank earns from its loans, rose 8% year over year to $16.4 billion, supported by higher loan and deposit balances.

At the same time, investment banking fees fell 11% from a year earlier, to $1.8 billion, while beating analysts’ forecasts after CEO Moynihan telegraphed the bank’s relatively quieter time for deal-making.