Banking leaders Bank of America (BAC) and Wells Fargo (WFC) announced significant profit increases for both the fourth quarter and full-year results compared with the previous year, driven largely by strong trading activity and lending revenue, reports Baltimore Chronicle via customreceipt.com.
Bank of America recorded a net income of $7.6 billion for the quarter, marking a 12% increase from the same period last year and exceeding analyst expectations of $7.4 billion. Wells Fargo posted a 6% increase in net income to $5.4 billion, aligning with market forecasts. Both banks achieved their highest annual net income in four years, reflecting robust operational performance.
Earnings per share for Bank of America reached $0.98, surpassing analyst predictions, while Wells Fargo reported $1.62 per share, slightly below the forecast of $1.67. Wells Fargo’s quarterly results were affected by $0.14 per share in severance costs. Following the announcements, Bank of America shares rose approximately 1% in pre-market trading, whereas Wells Fargo shares fell nearly 1%.
Revenue growth at both institutions was supported by higher lending volumes and increased fee income. Bank of America’s total revenue rose 7% year-over-year to $28 billion, while Wells Fargo achieved a 4% increase to $21.3 billion. Within the fourth quarter, Bank of America’s dealmaking revenue climbed 1% to $1.67 billion, and trading fees within its sales and trading division rose 10% to $4.5 billion, driven primarily by equities. In contrast, Wells Fargo’s investment banking revenue declined slightly by 1%, although its markets division, which manages trading operations, reported an 8% increase in trading fees, totaling $1.6 billion.
Both CEOs expressed optimism about the U.S. economy and their banks’ prospects. Bank of America CEO Brian Moynihan stated, “While any number of risks continue, we are bullish on the U.S. economy in 2026.” Wells Fargo CEO Charles Scharf highlighted regulatory relief, saying, “We are excited to now compete on a level playing field and are able to dedicate even more resources to growth with the ability to grow our balance sheet.”
Wells Fargo reported a severance expense of $612 million for the quarter, reflecting ongoing workforce reductions. The bank’s headcount fell to 205,000 employees by the end of December, a 6% decline compared with the end of 2024.
