01—Abstract
Summary
Summary of the 8-K filed July 1, 2025. Cited figures are marked; the original filing is the authoritative source.
On July 1, 2025, Bank of America (BAC) announced it plans to raise its quarterly common stock dividend 8%, from $0.26 to $0.28a per share, beginning in the third quarter of 2025, subject to Board of Directors approval.
The announcement follows the Federal Reserve's 2025 Comprehensive Capital Analysis and Review (CCAR), in which the bank's modeled capital depletion improved 100 bps to 170 bps. Under current Federal Reserve rules, the preliminary stress capital buffer (SCB) would fall 70 bps to 2.5%b, lowering the CET1 minimum requirement to 10.0%, effective October 1, 2025. The Federal Reserve has also proposed changes to the SCB calculation; if adopted as proposed, the 2025 results would imply an SCB of 2.7% and a CET1 minimum of 10.2%, effective January 1, 2026.
As of March 31, 2025, the bank held $201 billionc of regulatory CET1 capital, a CET1 ratio of 11.8%, comfortably above the current requirement. For investors, the filing signals strong capital positioning and a commitment to shareholder returns. The dividend increase and lower buffer requirement give management more flexibility for future capital returns, though the proposed rule change would raise the effective requirement, so its final form is a key item to watch.
02—Key points
Key Highlights
- Quarterly common dividend to rise 8% from $0.26 to $0.28 per share starting Q3 2025, subject to Board approval.
- Preliminary stress capital buffer (SCB) improves 70 bps to 2.5% under current rules; CET1 minimum requirement falls to 10.0%, effective October 1, 2025.
- Modeled capital depletion improved 100 bps to 170 bps in the 2025 CCAR stress test.
- Proposed Federal Reserve changes to SCB calculation would imply a 2.7% SCB and a 10.2% CET1 minimum, effective January 1, 2026.
- CET1 capital of $201 billion and a CET1 ratio of 11.8% at March 31, 2025, exceeding the current minimum requirement.
- Filing includes the press release as Exhibit 99.1 under Item 8.01 (Other Events).
03—Questions
Frequently Asked Questions
How much will the dividend increase, and when does it take effect?
The quarterly common stock dividend is planned to rise from $0.26 to $0.28 per share, an increase of about 8%, beginning in the third quarter of 2025. The increase still requires approval from the Board of Directors.
What is the stress capital buffer and how is it changing?
The stress capital buffer (SCB) is the capital add-on tied to the Federal Reserve's stress test results. Under current rules, Bank of America's preliminary SCB improves 70 bps to 2.5%, which sets a CET1 minimum requirement of 10.0%, effective October 1, 2025.
What could change the capital requirement going forward?
The Federal Reserve has proposed modifications to the SCB calculation. If adopted as proposed, Bank of America's SCB would be 2.7% and its CET1 minimum 10.2%, effective January 1, 2026, which would be a higher requirement than under current rules.
Is Bank of America well capitalized relative to these requirements?
Yes. At March 31, 2025, the bank had $201 billion of regulatory CET1 capital and an 11.8% CET1 ratio, which exceeds the current minimum requirement, including under the proposed higher requirement of 10.2%.
What does the improved stress test result indicate?
Modeled capital depletion, the drop from starting CET1 ratio to the most stressed point in the scenario, improved 100 bps to 170 bps. This indicates the bank's balance sheet performed better under the Federal Reserve's hypothetical severely adverse scenario than in the prior test.
04—Continue