Bank of America Q3 Profit Drops 17% to $6.93B on $1.2B Treasury Fine and Trading Miss

Bank of America reported a 17% decline in third-quarter profit to $6.93B, or 91 cents per share, after absorbing a $1.2B penalty from the U.S. Treasury Department over failures to report billions of dollars in suspicious transactions. Shares of the second-largest U.S. bank by assets fell more than 4% in premarket trading following the results, as quarterly revenue on an FTE basis reached $30.12B—rising 3.2% year-over-year but missing LSEG estimates of $30.69B by about $570M. Excluding the regulatory penalty, which reduced earnings by 17 cents per share, Bank of America's earnings per share would have been $1.08, compared with an LSEG consensus estimate of $1.10 that may not be directly comparable. Wall Street trading misses weighed heavily on the top line: fixed income trading revenue dropped 17% to $2.55B—roughly $450M below StreetAccount estimates—due to weakness in mortgages, municipals, and credit activity, while equities trading revenue rose 10% to $2.51B but still missed analyst expectations by nearly $300M. The compliance failure and trading shortfall renew scrutiny of internal risk controls under CEO Brian Moynihan, who has led the bank since 2010.