Bank of America Warns Q3 Investment Banking Fees to Drop Over 10%
Bank of America CEO Brian Moynihan warned that the bank's investment banking fees for the third quarter are expected to decline by more than 10% compared to last year, projecting a range between $1.6 billion and $1.8 billion—below analysts' expectations closer to $2 billion. The broader market is also down about 10%, but Bank of America's positioning in less active segments means it will see an even sharper drop. Moynihan noted that trading revenue would remain roughly flat compared with the strong recovery seen last year, despite a better-than-usual third quarter for equities and weaker fixed income performance. The outlook contrasts sharply with Q2 results where investment banking fees rose 50% to $2.1 billion and total sales and trading surged by 33%. Bank of America's stock dropped over 5%, marking its worst one-day decline since April 2025, while other major banks also saw declines. Despite the capital markets headwinds, Moynihan described the broader business as performing well. Net interest income growth remains strong at the upper end of guidance for 2026, and wealth management fees are up between 10% to 15%. He emphasized that while market conditions affect sentiment, the underlying economy and core banking operations remain robust.
Topics: Bank of America investment banking fees Q3 outlook stock performance