Catenaa, Wednesday, October 14, 2026- Bank of America stock fell more than 5.5% on Wednesday after the Treasury fined the bank $1.2 billion for laundering and sanctions violations.
Federal regulators accused Bank of America of deficiencies in monitoring and reporting suspicious transactions totaling more than $5 billion. The activity reportedly included transactions potentially associated with money laundering networks and drug trafficking.
According to Investopedia, the Treasury said its investigation uncovered a “failure to mitigate and report priority national security risks,” including more than $5 billion in suspicious transactions. Bank of America also agreed to an $11.6 million settlement over nearly 500 “apparent violations of multiple sanctions programs”, including on Russia and Iran.
“Financial crime compliance is serious, and we are responsible for getting it right,” a Bank of America spokesperson told Investopedia, adding that the bank has “dedicated substantial personnel and resources to our ongoing remediation efforts.
Moreover, the stock was also affected as the bank’s quarterly results missed analysts’ estimates.
The bank said it earned 91 cents per share in the third quarter, below the $1.09 analysts expected, as the fine caused a 17-cent hit to earnings.
Revenue came in at $30.0 billion, up 3% year over year, but short of the $30.39 billion consensus of analysts tracked by Visible Alpha as revenues from investment banking and trading fell.
Bank of America’s trading revenue weakened during the quarter, reflecting lower fixed-income activity. Sales and trading revenue, excluding net debit valuation adjustments, fell 5.5% from a year earlier to $5.06 billion, ending a run of 17 consecutive quarters of growth.
Fixed-income trading fees declined 17.2%, while equity trading income increased 10.4%.
Provision for credit losses was $1.27 billion, down 2% from the prior-year quarter.
Net charge-offs declined 1.3% year over year to $1.35 billion. As of September 30, 2026, non-performing loans and leases as a percentage of total loans were 0.44%, down 2 bps from the prior-year period.
After Wednesday’s slump, Bank of America shares are down more than 7% for the year.
