Bank of America CEO Projects 10% Q3 Investment Banking Fee Drop

Bank of America expects third-quarter investment banking fees to decline by at least 10% year-over-year, projecting revenue between $1.6 billion and $1.8 billion down from $2 billion in the same period a year earlier, according to a MarketScreener report. The projected pullback reflects a normalization in capital markets following a strong first half of the year across major financial institutions.

"What we're seeing is the market generally in investment banking is down 10% or so... We're down to small position in some of the businesses that had more activity, so we'll be down probably a bit more than that," said Brian Moynihan, Chief Executive Officer, Bank of America, at the Barclays global financial services conference.

Market Reaction and Trading Revenue Outlook

Following the Chief Executive Officer's comments at the conference, Bank of America shares extended losses to drop over 5% in late afternoon trade, while the S&P 500 banking index fell 2.7%, according to MarketScreener.

Despite the expected contraction in fee-based advisory and underwriting work, the bank anticipates that sales and trading revenue will remain roughly flat compared to the $5.4 billion recorded in the third quarter of 2025. This steady trading desk performance helps cushion the broader revenue impact from slowing deal pipelines.

Comparison to Prior Quarters and Competitor Outlook

The expected third-quarter slowdown follows a strong second quarter for the institution. During that earlier period, Bank of America posted a 50% jump in investment banking fees to reach $2.1 billion alongside a 33% jump in trading revenue.

Peer institutions are navigating the period with varying momentum. Later on Monday, Citigroup Chief Financial Officer Gonzalo Luchetti told analysts that investment banking was tracking for low-single-digit revenue growth in the third quarter, while trading was heading for mid-single-digit growth, according to CNBC.

What Is at Stake for Wall Street

The divergence in projected third-quarter results highlights how different institutions are positioned across debt underwriting, equity capital markets, and advisory services. As dealmaking activity fluctuates from the highs earlier in the year, executives are managing investor expectations regarding cyclical shifts in fee income versus steadier trading operations.