01—Abstract
Summary
Summary of the 8-K filed July 16, 2025. Cited figures are marked; the original filing is the authoritative source.
Bank of America reported second-quarter 2025 net income of $7.1 billiona, or $0.89 per diluted share, versus $6.9 billion, or $0.83, a year earlier.
Revenue net of interest expense rose 4% year over year to $26.5 billionb, driven by net interest income up 7% to $14.7 billion, higher sales and trading revenue, and asset management fees, partially offset by lower investment banking fees. Quarter over quarter, net income and EPS dipped slightly from $7.4 billion and $0.90, as revenue fell 3% on lower Global Markets and All Other results, though noninterest expense also declined 3% after seasonal payroll tax costs rolled off. Credit quality was broadly stable.
Provision for credit losses rose to $1.6 billionc, net charge-offs were flat at $1.5 billion (a 0.55% ratio), and nonperforming loans declined to $6.0 billion. Average deposits grew 3% sequentially to $1.97 trillion and average loans rose 7% year over year to $1.13 trillion. The CET1 ratio (Standardized) was 11.5%, down from 11.8% in the prior quarter, and the company returned $7.3 billion to shareholders, including $5.3 billion in buybacks.
Management also announced plans to raise the quarterly common dividend 8% beginning in 3Q25, subject to board approval. For investors, the quarter shows steady earnings growth supported by net interest income recovery and strong wealth and markets activity, with book value per share up 8% and tangible book value per share up 9% year over year. Guidance for 4Q25 net interest income of roughly $15.5 billion to $15.7 billiond and an expected return to operating leverage in 2H25 point to continued momentum, while the lower capital ratio and a slightly higher adjusted effective tax rate of 24% warrant monitoring.
02—Key points
Key Highlights
- Net income of $7.1 billion and diluted EPS of $0.89, up from $6.9 billion and $0.83 in 2Q24 (about 7% EPS growth year over year)
- Revenue net of interest expense of $26.5 billion, up 4% year over year; net interest income up 7% to $14.7 billion, with a fourth consecutive quarter of sequential NII growth
- Noninterest expense of $17.2 billion, up 5% year over year but down 3% from 1Q25 as seasonal payroll tax costs fell away; management expects operating leverage in 2H25
- Credit quality stable: net charge-offs of $1.5 billion (0.55% ratio), provision of $1.6 billion, and nonperforming loans down to $6.0 billion
- Capital return of $7.3 billion in the quarter ($5.3 billion buybacks, $2.0 billion dividends), with a planned 8% increase to the quarterly common dividend starting 3Q25
- CET1 ratio of 11.5% (Standardized) versus 11.8% in 1Q25, still well above regulatory minimums; tangible book value per share rose 9% year over year to $27.71
- Global Markets net income of $1.5 billion and Global Banking net income of $1.7 billion; Consumer Banking net income rose 15% year over year to $3.0 billion
03—Questions
Frequently Asked Questions
How did Bank of America's second-quarter 2025 earnings compare with last year and last quarter?
Net income was $7.1 billion, or $0.89 per diluted share, compared with $6.9 billion, or $0.83, in 2Q24, an increase of about 7% in EPS. Compared with 1Q25 ($7.4 billion, $0.90), net income and EPS were slightly lower, mainly because revenue fell 3% quarter over quarter, partly offset by lower expenses.
What drove revenue growth, and where was it weaker?
Revenue net of interest expense rose 4% year over year to $26.5 billion. Net interest income grew 7% to $14.7 billion on fixed-rate asset repricing, higher Global Markets-related NII, and deposit and loan growth, partly offset by lower rates. Sales and trading revenue rose 14% and asset management fees rose 9%. Investment banking fees fell 9% (excluding self-led deals) and Global Banking revenue declined 6%.
Is the bank's credit quality deteriorating?
Not materially. Net charge-offs were $1.5 billion, flat year over year and up $73 million from 1Q25, with the ratio at 0.55%. Consumer card loss rates improved and card delinquencies declined. Commercial charge-offs rose mainly on sales and resolutions of commercial real estate office properties. The provision rose to $1.6 billion, reflecting a net reserve build of $67 million, and nonperforming loans fell to $6.0 billion.
What is the outlook for net interest income and expenses?
Management guides 4Q25 net interest income to about $15.5 billion to $15.7 billion (FTE basis), versus $14.8 billion in 2Q25, assuming 25 basis points of rate cuts in September and October 2025 and continued low-single-digit deposit growth and mid-single-digit loan growth. The company expects to deliver operating leverage in 2H25. A 100 basis point parallel downward shift in rates is estimated to reduce 12-month NII by about $2.3 billion.
What does the capital and shareholder return picture look like?
The CET1 ratio under the Standardized approach fell to 11.5% from 11.8% in 1Q25, though CET1 capital was flat at $201 billion, reflecting higher risk-weighted assets. The company returned $7.3 billion to shareholders in the quarter and plans an 8% increase in the quarterly common dividend starting in 3Q25, subject to board approval. Book value per share reached $37.13, up 8% year over year, and the ROTCE was 13.4%.
04—Continue