CHARLOTTE, N.C., Jan 14, 2026, 07:12 EST
Bank of America posted a stronger fourth-quarter profit Wednesday as net interest income and trading revenue both gained. Net income hit $7.6 billion, or 98 cents per share, while revenue excluding interest expense rose 7% to $28.4 billion. Net interest income, the earnings from loans after deposit costs, was up 10% to $15.8 billion. Sales and trading revenue increased 10% to $4.5 billion. Shares slipped 1.2% in premarket trading. CEO Brian Moynihan said he’s “bullish on the U.S. economy in 2026,” and CFO Alastair Borthwick noted deposits finished 2025 above the $2 trillion mark. (SEC)
The results come at the start of bank earnings season, with investors zeroing in on a key issue: can lenders sustain momentum if rising interest rates lose their boost? Net interest income drives that momentum, and it’s the line most sensitive to shifts in rates and deposit expenses.
Trading is unpredictable. It spikes when markets get unsettled, then fades just as fast. That’s why quarterly reports are both scrutinized like tea leaves and taken as hard facts all at once.
A supplemental filing revealed Consumer Banking raked in $3.3 billion for the quarter, with Global Banking contributing $2.1 billion and Global Markets adding $984 million. The “All Other” category, however, flipped to a $132 million loss. The bank reserved $1.3 billion for credit losses, setting aside funds against potential bad loans. Deposits totaled roughly $2.0 trillion, while average loans and leases stood near $1.17 trillion.
The bank topped Wall Street forecasts, data from Zacks Investment Research cited by the Associated Press showed. Analysts predicted earnings of 96 cents per share on net interest revenue of $27.49 billion. The actual results came in at 98 cents and $28.37 billion, respectively. (Seattle Post-Intelligencer)
According to Reuters, late-2025 market swings drove client activity, boosting trading as investors adjusted portfolios amid rate-cut speculation and other factors. The report also highlighted Bank of America’s shares climbing over 25% in 2025, though they trailed gains at JPMorgan Chase and Wells Fargo.
The bank’s own forecasts highlight just how fast lending profits could take a hit if rates drop quicker than anticipated. Bank of America projects 2026 net interest income to rise 5% to 7% on a fully taxable-equivalent basis — a standard adjustment that aligns tax-free income — and expects around 200 basis points of operating leverage, meaning revenue should outpace expenses. However, it cautioned that a 100-basis-point parallel decline below the forward curve would slash net interest income by roughly $2 billion over the next year.
Peers show a familiar divide: some banks report steadier lending income, while others see more fluctuation in trading and fees. Wells Fargo posted a fourth-quarter profit of $5.36 billion, boosted by higher interest income, with net interest income climbing 4% to $12.33 billion.
JPMorgan, which reported a day earlier, posted net income of $13.0 billion, down 7%, weighed by costs linked to becoming Apple’s credit card issuer and setting aside a $2.2 billion credit reserve, the Associated Press reported. The bank said adjusted profit climbed to $14.7 billion, or $5.23 per share.
Bank of America now faces scrutiny beyond the headlines: investors will zero in on deposit costs moving forward, the resilience of loan demand, and the trajectory of credit card losses if the economy slows. Upcoming bank earnings will reveal whether this quarter sets a trend or stands as an outlier.
