Bank of America Shares Drop 4% After Q3 Earnings and Revenue Miss, Hit by $1.2B Regulatory Settlement Charge

Bank of America reported third-quarter 2026 results on October 14 that fell short of Wall Street estimates on both earnings and revenue, sending shares down roughly 4%. The bank's reported net income came in at $6.9 billion, or $0.91 per diluted share, weighed down by a $1.2 billion regulatory settlement charge booked in noninterest expense that alone cut earnings per share by $0.17. Excluding that charge, adjusted net income would have been $8.1 billion, or $1.08 per diluted share, still below the analyst consensus estimate of approximately $1.12.

The provision for credit losses reached $1.30 billion in the quarter, contributing to the earnings shortfall alongside the elevated noninterest expense. The efficiency ratio deteriorated to 66% on a reported basis, up four percentage points, while return on equity fell to 9.4% and return on tangible common equity came in at 12.6%. Those figures compare unfavorably with the prior two quarters, when BofA posted net income of $9.1 billion in Q2 and $8.6 billion in Q1.

On the balance sheet, ending deposits grew 2% year over year to $2.04 trillion and loans and leases rose 7% to $1.25 trillion. The CET1 capital ratio stood at 10.9%, and the bank repurchased $6 billion of common stock during the period. Investment banking pipelines were described as robust and year-to-date sales and trading revenue reached a record, offering some counterweight to the headline miss.