Trading slump and regulatory fine hit Bank of America shares
Bank of America's third-quarter profit fell 17% to $6.93 billion after a $1.2 billion regulatory penalty and weak trading revenue.
Bank of America reported weak third-quarter earnings. The bank was hit with a $1.2 billion regulatory penalty by US authorities.
The bank's profit fell 17% to $6.93 billion, disappointing investors. Shares fell as much as 8% in morning trading.
Fixed income trading revenue dropped 17% to $2.55 billion. Weakness in mortgages, municipals and credit activity drove the drop.
Fixed income trading came in roughly $450 million below expectations. Equities trading missed by nearly $300 million.
CEO Brian Moynihan had told analysts last month that trading revenue would stay roughly flat. Instead it fell 5% overall.
The regulatory penalty was related to failures in reporting suspicious transactions. This raised questions about the bank's internal controls and compliance.
- 17% to $6.93 billion
- Profit decline
- $1.2 billion
- Regulatory penalty
- 8%
- Share price decline
- $450 million below estimate
- Fixed income trading miss
Why it mattersBank of America's earnings weakness could point to bigger problems in Wall Street banking and capital markets activity.
AustraliaNo direct Australian impact yet, but Bank of America's financial struggles could affect Australian companies seeking US financing or investors holding US bank stocks.
✓ Claims checked against the source and corrected before publish. checked 3 h ago
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