Bank of America Corp. (NYSE:BAC) reported stronger-than-expected second-quarter fiscal 2026 results on Tuesday.
Net income rose to $9.1 billion from $7.2 billion a year earlier, while earnings per share came in at $1.21, topping the consensus estimate of $1.13.
Revenue, net of interest expense, increased 15% year over year to $31.56 billion, ahead of estimates of $30.75 billion. The bank said debit and credit card spending climbed 9% to $266 billion during the quarter.
Segment Performance
Consumer Banking generated net income of $3.28 billion, up from $2.97 billion a year ago. Global Wealth and Investment Management reported $1.41 billion, compared with $993 million a year earlier.
Global Banking posted $2.05 billion, up from $1.7 billion, while Global Markets earned $2.63 billion versus $1.53 billion last year.
Net interest income increased 9% year over year to $16.0 billion, driven by higher activity in Global Markets, increased deposit and loan balances, and fixed-rate asset repricing, partially offset by lower interest rates.
Noninterest income rose 22% to $15.6 billion. Provision for credit losses declined to $1.4 billion from $1.6 billion a year earlier, while investment banking fees jumped 50% to $2.1 billion, reflecting strength across debt underwriting, advisory, and equity underwriting.
Balance Sheet and Capital Return
The bank’s efficiency ratio fell to 59.02% from 62.61% a year ago. Its Common Equity Tier 1 (CET1) ratio was 11.2%, compared with 11.5% a year earlier. Book value per share increased to $39.34 from $36.92, while tangible book value per share rose to $29.37 from $27.49.
Average loan and lease balances grew 8% to $1.22 trillion, and average deposits rose over 2% to $2.02 trillion, marking the 12th consecutive quarter of sequential growth.
The company returned capital to shareholders through about $2.0 billion in dividends and $6.0 billion in share repurchases during the quarter.
Bank of America executives and analysts pointed to stronger trading, dealmaking, and lending activity as signs that the bank benefited from market volatility and a resilient economy.
Executives And Analysts Highlight Growth Drivers
CEO Brian Moynihan had earlier said Bank of America expected sales and trading revenue to rise 15%, but the business delivered a 33% jump to a record $7.1 billion. Moynihan also said investment banking was in “pretty good shape,” as investment banking fees increased 50% to $2.1 billion.
Stephen Biggar, director of Financial Services Research at Argus Research, told Reuters that the AI-driven capital spending cycle supported equity issuance, M&A activity, and debt financing. He also said Iran-related volatility helped trading across asset classes.
Biggar said the $2.5 trillion in announced global M&A during the first half of the year should continue to benefit banks as deals close over the next six to nine months. He also said the mega-IPO pipeline remains intact for the second half of the year.
CFO Alastair Borthwick said Bank of America’s strategy is working, citing disciplined investments, organic growth, market-share gains, strong operating metrics, and higher profitability.
According to Benzinga Pro, Borthwick said Bank of America remains encouraged by the near-term outlook, adding that consumers remain resilient and asset quality continues to be healthy.
BAC Price Action: Bank of America shares were down 0.54% at $59.18 during premarket trading on Tuesday, according to Benzinga Pro data.
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