Bank of America Corporation (NYSE: BAC) announced its financial results for the fourth quarter of fiscal year 2025, demonstrating noteworthy growth despite a slight dip in net income compared to the previous year. The bank recorded a net income of $7.6 billion, improving from $6.8 billion reported in the prior year’s fourth quarter. Earnings per share (EPS) rose to 98 cents, surpassing analyst expectations of 96 cents.
Revenue, net of interest expenses, increased by 7% year-over-year (Y/Y) reaching $28.532 billion, outpacing the anticipated $27.944 billion. The increase was supported by growing consumer and business activity, reflected in segments of the bank’s operations as well as overall loan and deposit balances.
During the period, debit and credit card spending surged 6%, with total transactions amounting to $255 billion. Notably, the rate of credit card balances more than 90 days past due improved, declining from 1.35% a year earlier to 1.27%, signaling healthier consumer credit conditions.
Performance Across Business Segments
The Consumer Banking division posted net income of $3.30 billion, an increase from $2.82 billion registered in the previous year’s corresponding quarter. Meanwhile, Global Wealth and Investment Management saw its net income rise to $1.41 billion from $1.17 billion the prior year, highlighting strong wealth management and investment activities.
Global Banking generated $2.09 billion, slightly lower compared to $2.14 billion a year earlier, indicating relatively stable institutional banking revenues. The Global Markets segment experienced growth, recording $997 million in net income, up from $953 million year-over-year.
Income and Expense Metrics
Net interest income (NII), a critical revenue source for the bank, increased by 10% Y/Y to $15.9 billion. This growth was propelled by higher activity in Global Markets, repricing of fixed-rate assets, and increased deposit and loan balances, though partially offset by the impact of lower interest rates overall.
Noninterest income also grew by 4% year-over-year, totaling $12.6 billion. The provision for credit losses decreased, falling from $1.5 billion the previous year to $1.3 billion, reflecting improved credit quality and risk management. Investment banking fees rose modestly by 1% to $1.7 billion, underscoring solid fee-generating capabilities.
Balance Sheet and Capital Position
Efficiency ratios reflected operational improvements, with the efficiency ratio tightening to 61.11% in the quarter from 63.04% a year prior. Common Equity Tier 1 (CET1) capital ratio decreased slightly to 11.4% from 11.9%, maintaining a robust capital base.
The bank reported an 8% increase in book value per share to $38.44. Tangible book value per share of common stock rose from $26.37 to $28.73 compared to the previous year, signaling enhanced shareholder value creation.
Loan and lease balances averaged $1.17 trillion, representing an 8% year-over-year increase, while average deposits grew by 3% year-over-year to $2.01 trillion. This deposit growth marks the tenth consecutive quarter of sequential increases, underscoring strong customer funding and liquidity.
In terms of capital return to shareholders, the bank disbursed $2.1 billion in dividends and repurchased $6.3 billion in stock, reflecting a commitment to delivering value back to investors.
Leadership Commentary and Outlook for 2026
Brian Moynihan, Chief Executive Officer of Bank of America, emphasized the institution’s robust year-end performance, which culminated in over $30 billion in net income for fiscal 2025, along with a 19% increase in earnings per share from 2024. Moynihan highlighted revenue growth, positive operating leverage, and improved efficiency metrics as drivers of enhanced returns.
Regarding the economic outlook, Moynihan expressed optimism for the United States economy in 2026, attributing it to resilient consumer and business spending along with increased clarity in regulatory, tax, and trade policies. While acknowledging ongoing risks, he reinforced the bank’s positive stance on economic growth prospects in the coming year.
Looking ahead, Bank of America forecasts net interest income growth in the range of 5% to 7% year-over-year for 2026, with anticipated first-quarter growth approximating 7% year-over-year.
Stock Market Response
Following the earnings announcement, Bank of America shares experienced a decline of 1.54%, trading at $53.70 during premarket hours. This movement reflects short-term market reactions amid broader economic and sector influences.