Bank of America Corporation

Second quarter revenue increased 15% year over year to $31.6 billion. Net income was $9.1 billion, up 27% from last year, and EPS rose 34% to $1.21. On an FTE basis, net interest income was approximately $16.2 billion, up 9% year over year, with net interest yield at 2.08%. The efficiency ratio improved to 59%, operating leverage was 6.6%, and ROTCE was 17%. Provision expense was approximately $1.4 billion and net charge-offs were also $1.4 billion. The company returned $8 billion through dividends and share repurchases, ended with CET1 of 11.2%, and held nearly $202 billion of Tier 1 common equity. Forward guidance: management expects full-year 2026 NII growth at the upper end of the 6%-8% range and full-year operating leverage in the 300-400 basis point range. They also said a 100 bps parallel shift above the forward curve would increase NII by $1 billion over the next 12 months.

Brian Moynihan framed the quarter as another broad-based demonstration of Bank of America’s scale, with every business segment contributing, improving efficiency, and generating operating leverage. He emphasized organic growth across deposits, loans, wealth, investment banking, and markets, while highlighting the company’s ability to invest in technology and AI without losing discipline. His tone was confident and constructive, and he repeatedly pointed to durable client activity and strong long-term earnings power.

Alastair Borthwick focused on balance sheet strength, deposit mix, and the path to higher NII and operating leverage. He said average deposits were $2.02 trillion, up $49 billion or 2.5% year over year, average loans and leases were $1.2 trillion, up $88 billion or 8%, and the CET1 ratio stayed at 11.2% versus a 10% minimum. He also noted non-interest expense of about $18.6 billion, up $100 million sequentially and $1.4 billion year over year, and said the firm’s first-half operating leverage exceeded 450 basis points, supporting a full-year outlook of 300-400 basis points. He added that the company is still paying down repo and institutional CDs over time, which should improve net interest yield and free capital.

Analysts pressed on whether the NII guide was conservative, especially given strong first-half NII growth and higher rates. Management said the second half faces tougher comps, but the guide already assumes modest deposit growth, continued loan growth, some fixed-rate asset repricing, and a current forward curve with one 25 bps hike in September; they said markets NII should be flat to slightly down and not the main driver. Questions also centered on operating leverage sustainability and AI: management said AI supports both revenue and expense efficiency, but much of the near-term leverage is still coming from NII and strong fee income. On credit and commercial lending, management said underwriting remains disciplined, pricing is getting tighter in some consumer products, and commercial loan growth is broad-based rather than just an AI-driven story.