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BAC Stock Gains as Q1 Earnings Beat on NII, Trading & IB Strength
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Key Takeaways
BAC Q1 EPS was $1.11, up 24.7% y/y, as revenues rose 7.2% to $30.27 billion.
Bank of America saw trading revenues rise 12% y/y and IB fees jump 23.6%, boosting overall growth.
BAC's NII grew 9% y/y to $15.91B, while credit losses fell and share buybacks hit $7.2 billion.
Bank of America’s (BAC - Free Report) first-quarter 2026 earnings of $1.11 per share handily surpassed the Zacks Consensus Estimate of $1.00. The bottom line grew 24.7% year over year.
BAC shares gained more than 1% in the pre-market trading in response to better-than-expected results. However, a full day’s trading session will depict a clearer picture.
Behind BAC’s Q1 Headline Numbers
Bank of America recorded an improvement in trading numbers for the 16th straight quarter. Sales and trading revenues, excluding net DVA, grew 12% year over year to $6.32 billion. Fixed-income trading fees increased 1%, while equity trading income soared 29.6%.
BAC’s investment banking (IB) performance was also solid this time. IB fees (in the Global Banking division) of $1.05 billion increased 23.6% year over year. Equity underwriting income increased 31.3%, while debt underwriting income rose 2.7% year over year. Advisory revenues grew 46.6%.
Improvement in the trading and IB business, along with higher net interest income (NII), drove Bank of America’s total revenues. NII rose on a year-over-year basis on higher interest income related to Global Markets activity, fixed-rate asset repricing and higher deposit and loan balances, partially offset by the impact of lower interest rates.
While provisions declined in the quarter on a year-over-year basis, non-interest expenses increased, which hurt the results to some extent.
The company’s net income applicable to common shareholders grew 17.3% from the prior-year quarter to $8.16 billion.
BAC’s Revenues Improve, Expenses Rise
Net revenues were $30.27 billion, which surpassed the Zacks Consensus Estimate of $29.94 billion. The top line rose 7.2% from the prior-year quarter.
NII (fully taxable-equivalent basis) grew 9% year over year to $15.91 billion. Net interest yield expanded 8 basis points (bps) to 2.07%.
Non-interest income rose 5.2% to $14.53 billion. This was driven by higher total fees and commissions, and market making and similar activities.
Non-interest expenses were $18.53 billion, up 4.3% year over year. The rise was due to an increase in all cost components, except for professional fees and other general operating expenses.
The efficiency ratio was 61.22%, down from 62.91% in the year-ago quarter. A fall in the efficiency ratio indicates an improvement in profitability.
Bank of America’s Credit Quality Improves
Provision for credit losses was $1.34 billion, down 9.7% from the prior-year quarter.
Net charge-offs declined 3% year over year to $1.41 billion. As of March 31, 2026, non-performing loans and leases as a percentage of total loans were 0.49%, down 7 bps from the prior-year period.
BAC’s Capital Position Strong
Book value per share as of March 31, 2026, was $38.66 compared with $36.17 a year ago. Tangible book value per share was $28.84, up from $26.90 a year ago.
At the end of March 2026, the common equity tier 1 capital ratio (advanced approach) was 12.5% compared with 13.3% as of March 31, 2025.
BAC’s Share Repurchase Update
In the reported quarter, the company repurchased shares worth $7.2 billion.
Our Take on Bank of America
BAC’s focus on digitizing and expanding operations, along with solid loan growth and stabilizing deposit/funding costs, is likely to keep supporting growth. However, elevated expenses and a challenging operating backdrop pose major headwinds.
Bank of America Corporation Price, Consensus and EPS Surprise
Performance & Earnings Release Date of BAC’s Peers
JPMorgan (JPM - Free Report) posted first-quarter 2026 earnings of $5.94 per share, up 17.2% from $5.07 in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate of $5.49.
JPMorgan reported net revenues of $49.8 billion, which increased 10% year over year. The metric also topped the consensus mark of $48.6 billion. JPM’s quarterly results were powered by a record Markets performance, a robust IB business and higher NII.
KeyCorp (KEY - Free Report) is slated to announce first-quarter 2026 results tomorrow.
Over the past seven days, the Zacks Consensus Estimate for KEY’s quarterly earnings has been unchanged at 41 cents. The figure implies 24.2% growth from the prior-year quarter’s actual.
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BAC Stock Gains as Q1 Earnings Beat on NII, Trading & IB Strength
Key Takeaways
Bank of America’s (BAC - Free Report) first-quarter 2026 earnings of $1.11 per share handily surpassed the Zacks Consensus Estimate of $1.00. The bottom line grew 24.7% year over year.
BAC shares gained more than 1% in the pre-market trading in response to better-than-expected results. However, a full day’s trading session will depict a clearer picture.
Behind BAC’s Q1 Headline Numbers
Bank of America recorded an improvement in trading numbers for the 16th straight quarter. Sales and trading revenues, excluding net DVA, grew 12% year over year to $6.32 billion. Fixed-income trading fees increased 1%, while equity trading income soared 29.6%.
BAC’s investment banking (IB) performance was also solid this time. IB fees (in the Global Banking division) of $1.05 billion increased 23.6% year over year. Equity underwriting income increased 31.3%, while debt underwriting income rose 2.7% year over year. Advisory revenues grew 46.6%.
Improvement in the trading and IB business, along with higher net interest income (NII), drove Bank of America’s total revenues. NII rose on a year-over-year basis on higher interest income related to Global Markets activity, fixed-rate asset repricing and higher deposit and loan balances, partially offset by the impact of lower interest rates.
While provisions declined in the quarter on a year-over-year basis, non-interest expenses increased, which hurt the results to some extent.
The company’s net income applicable to common shareholders grew 17.3% from the prior-year quarter to $8.16 billion.
BAC’s Revenues Improve, Expenses Rise
Net revenues were $30.27 billion, which surpassed the Zacks Consensus Estimate of $29.94 billion. The top line rose 7.2% from the prior-year quarter.
NII (fully taxable-equivalent basis) grew 9% year over year to $15.91 billion. Net interest yield expanded 8 basis points (bps) to 2.07%.
Non-interest income rose 5.2% to $14.53 billion. This was driven by higher total fees and commissions, and market making and similar activities.
Non-interest expenses were $18.53 billion, up 4.3% year over year. The rise was due to an increase in all cost components, except for professional fees and other general operating expenses.
The efficiency ratio was 61.22%, down from 62.91% in the year-ago quarter. A fall in the efficiency ratio indicates an improvement in profitability.
Bank of America’s Credit Quality Improves
Provision for credit losses was $1.34 billion, down 9.7% from the prior-year quarter.
Net charge-offs declined 3% year over year to $1.41 billion. As of March 31, 2026, non-performing loans and leases as a percentage of total loans were 0.49%, down 7 bps from the prior-year period.
BAC’s Capital Position Strong
Book value per share as of March 31, 2026, was $38.66 compared with $36.17 a year ago. Tangible book value per share was $28.84, up from $26.90 a year ago.
At the end of March 2026, the common equity tier 1 capital ratio (advanced approach) was 12.5% compared with 13.3% as of March 31, 2025.
BAC’s Share Repurchase Update
In the reported quarter, the company repurchased shares worth $7.2 billion.
Our Take on Bank of America
BAC’s focus on digitizing and expanding operations, along with solid loan growth and stabilizing deposit/funding costs, is likely to keep supporting growth. However, elevated expenses and a challenging operating backdrop pose major headwinds.
Bank of America Corporation Price, Consensus and EPS Surprise
Bank of America Corporation price-consensus-eps-surprise-chart | Bank of America Corporation Quote
Currently, Bank of America carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance & Earnings Release Date of BAC’s Peers
JPMorgan (JPM - Free Report) posted first-quarter 2026 earnings of $5.94 per share, up 17.2% from $5.07 in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate of $5.49.
JPMorgan reported net revenues of $49.8 billion, which increased 10% year over year. The metric also topped the consensus mark of $48.6 billion. JPM’s quarterly results were powered by a record Markets performance, a robust IB business and higher NII.
KeyCorp (KEY - Free Report) is slated to announce first-quarter 2026 results tomorrow.
Over the past seven days, the Zacks Consensus Estimate for KEY’s quarterly earnings has been unchanged at 41 cents. The figure implies 24.2% growth from the prior-year quarter’s actual.