Bank of America Q3 Loss Widens to $1.35B Following $1.2B Treasury Fine

Bank of America Corp (NYSE:BAC) reported a widened net loss of $1.35 billion for the third quarter, compared to a loss of $103 million in the same period a year ago. The loss was driven by a $1.2 billion non-tax-deductible fine from the U.S. Department of the Treasury for anti-money laundering and sanctions law violations. Allegations indicated that the bank failed to mitigate and report national security risks, including illicit finance along the southwest border and Chinese money laundering networks.

Financial results missed analyst expectations even when excluding the regulatory penalty. Diluted earnings per share dropped to $0.91 from $1.04 a year earlier, with the settlement charge cutting $0.17 from per-share results. Adjusted earnings per share reached $1.08, trailing consensus forecasts of $1.10. Total revenue increased to $30.0 billion from $29.0 billion last year, supported by an 8% rise in net interest income to $16.6 billion, though overall revenue fell slightly short of expectations.

Investors are watching management's scheduled earnings conference call for details on compliance improvements and forward performance. While investment banking and trading revenues declined, commercial lending grew across all client segments, and provision for credit losses remained flat at $1.3 billion.