Q3 Fee Decline
Bank of America Predicts Third-Quarter Fee Decline Amid Slower Wall Street Dealmaking
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Moynihan said Bank of America expects third-quarter investment banking revenue of $1.6 billion to $1.8 billion, compared with $2 billion in the same quarter a year earlier.
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Moynihan attributed the market comparison to Dealogic data and said Bank of America is less well positioned in some of the businesses currently seeing the most activity, which could leave it performing slightly worse than the overall market.
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The bank expects third-quarter sales and trading revenue to be roughly flat compared with $5.4 billion in the third quarter of 2025.
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Moynihan made the remarks at the Barclays Global Financial Services Conference, where he said the deal pipeline remained solid and full despite the weaker near-term outlook.
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The reports describe Bank of America as the second-largest U.S. bank by assets, making its outlook a potential signal for the broader Wall Street advisory and capital-markets industry.
Bank of America expects third-quarter investment banking fees to drop more than 10% to roughly $1.6 billion-$1.8 billion, a sharp pullback from $2 billion a year earlier Quartz. CEO Brian Moynihan warned that the broader investment banking market is weakening, though the bank still sees a strong deal pipeline among middle-market clients.
The forecast spooked investors—shares fell about 5% after the announcement The Edge Malaysia. The decline raises questions about whether Wall Street's AI-fueled dealmaking boom is cooling, especially as higher interest rates may reduce financing demand Briefs.
A Sharp Reversal From Q2's Strong Run
Bank of America reported a blazing second quarter, with investment banking fees up 50% and trading revenue climbing 33% Quartz. But momentum is fading fast. Q3 will see investment banking fees fall from the year-ago $2 billion to somewhere between $1.6 billion and $1.8 billion, a decline that mirrors weakness across Wall Street.
Sales and trading revenue is expected to be flat, matching Q3 2024's $5.4 billion Quartz. Moynihan acknowledged that Bank of America is "less well positioned" in some hot market sectors, which could make the bank underperform versus the overall market.
The Broader Wall Street Slowdown Takes Hold
The investment banking market itself is contracting, down roughly 10% year-over-year Aktien Sensor. This pullback affects the entire advisory and capital-markets industry. Bank of America, the second-largest U.S. bank by assets, is a bellwether—its weakness signals trouble for competitors Briefs.
The slowdown contradicts earlier hopes that artificial intelligence would spark a sustained M&A and dealmaking surge. Instead, rising interest rates appear to be chilling financing appetite just as Wall Street hoped for a sustained recovery.
A Silver Lining in the Deal Pipeline
Despite the grim near-term outlook, Moynihan struck a more hopeful note about the deal pipeline. He told the Barclays Global Financial Services Conference that Bank of America still sees a "solid and full" pipeline of potential deals Quartz. The bank remains confident in middle-market clients and their appetite to do business.
That optimism may not be enough to ease investor concerns. A 10%-plus drop in fees and flat trading revenue signal that Wall Street's short-term outlook has darkened, even if deal prospects remain promising in the medium term Aktien Sensor.
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