BofA flags weak Q3 investment banking fees: one-off warning or sectoral alarm?

On September 14, 2026, Bank of America CEO Brian Moynihan warned during the Barclays Global Financial Services Conference that Q3 investment banking fees are projected to decline by 10% or more, falling from $2B in Q3 2025 to $1.6B–$1.8B. This news sent bank stocks into a downward spiral on Monday and Tuesday, with Bank of America shares dropping 5.14% to $59.47, contributing to a 2.7% decline in the S&P 500 Banks Index.

The decline in investment banking fees is attributed to a slowdown in the broader market, reduced financing activity, particularly in Asia prime brokerage, and higher-for-longer interest rates affecting deal pipelines. However, the issue extends beyond Bank of America, as Jefferies' data from September 3 revealed a 15% YoY decrease in investment banking proxy revenue for eight major global banks, with a 27% drop from Q2.

This declining trend was already evident before the latest disclosure. The structural implications of this situation are notable, with Goldman Sachs highlighting that European banks' equities market share has dropped in 4 of the last 6 quarters, with the three largest US players now 2.5x–5x the size of their European counterparts in equities.

Despite this, Canadian capital markets, driven by resource and commodities deal flow, show resilience as they move independently of the overall trend. The article emphasizes that while Goldman Sachs (GS) and JPMorgan (JPM) remain relatively stable due to their breadth in M&A advisory and dominant ECM positions, mid-tier IB players face significant challenges in the current economic climate.