Bank of America's Q3 2026 earnings carried a $1.2 billion money-laundering penalty, and the stock fell 4.76%

Bank of America shares closed at $51.39 on Wednesday, October 14, 2026, down 4.76%, after the bank reported third-quarter earnings of $0.91 a share that included a $1.2 billion charge for money-laundering and sanctions penalties. Excluding the charge, it earned $1.08 a share, still short of the $1.10 analysts expected, and revenue of $29.96 billion missed the $30.69 billion consensus.

The penalties were announced the evening before. Bank of America's statement that the charge would cut net income by about 17 cents a share reached the MoveSurge news feed at 4:21:38 p.m. ET on October 13, after the close, so the first reaction came in after-hours trading. During the session on October 14 the stock fell more than 8%, to its lowest level since May, and recovered part of that loss by the close.

What the regulators found

The Treasury Department called the package the third-largest penalty in its history, after Binance in 2023 and TD Bank in 2024, at more than $1.21 billion in total. The three actions overlap, because FinCEN's penalty includes credit for the OCC's, so the amounts in the table do not add up to the total.

FinCEN said the bank failed to report, or reported late, more than $5 billion of suspicious activity, including over $1 billion tied to priority risks such as fraud, Chinese money-laundering networks and suspected trade-based money laundering. Bank of America admitted willfully violating the Bank Secrecy Act on three counts and must pay for an independent review of transactions back to January 2022. The OCC said failures to escalate suspicious activity continued for more than a year after its December 2024 cease-and-desist order against the bank. The OFAC settlement covers 475 apparent violations, worth about $14.8 million, of the Russia, Belarus, Iran, Burma and Somalia sanctions programs, among others.

Why the charge hit earnings so hard

The penalty is not tax-deductible, so the full $1.2 billion came off net income, which fell to $6.9 billion. With no tax offset, a charge equal to about 4% of quarterly revenue removed 17 cents from the $1.08 a share the bank would otherwise have earned. Bank of America compares the quarter with $1.04 a share a year earlier, a figure restated in January 2026 for a change in how it accounts for tax-equity investments; it reported $1.06 at the time.

Bank of America would have missed estimates without the penalty because trading was weak. Sales and trading revenue fell 5% to $5.1 billion as fixed-income trading dropped 17% to $2.55 billion, while equities trading rose 10% to $2.51 billion. Investment-banking fees fell 11% to $1.8 billion. Net interest income, the bank's largest revenue line, rose 8% to $16.4 billion.

JPMorgan, which reported a day earlier, also posted lower fixed-income trading revenue, so weaker bond trading was common to both banks, while the penalty was Bank of America's alone. The bank still returned $8.3 billion to shareholders in the quarter, $6.0 billion of it in buybacks, and ended September with a 10.9% common equity tier 1 ratio. Our running page on Bank of America stock follows later moves.