Bank of America raser etter tallslipp

A penalty of over $1.2 billion has heavily impacted Bank of America's earnings, reducing the second-largest U.S. bank's quarterly profit by 17% for the year. Brian Moynihan, the bank's CEO, reported a net profit of $6.93 billion for the third quarter, a 16.8% decline compared to the same period last year. This comes as most of the bank's major competitors report double-digit profit increases.

The penalty, the third largest in record, was imposed by the U.S. Department of the Treasury for failing to report $5 billion in suspicious transactions involving sanctions programs against Iran, Russia, narcotics, and global terrorism. The Department of Treasury claims Bank of America did not report these transactions in a timely manner, prioritized its revenues, allowed suspicious activity to accumulate over extended periods without investigation, and did not respond promptly to increasing red flags from clients.

Bank of America reached an agreement with authorities, admitting to deliberately violating the Bank Secrecy Act by not reporting the $5 billion in suspicious transactions. As a result, the bank faces three separate penalties from the Financial Crimes Enforcement Network (FinCEN), the Federal Reserve (OCC), and the Office of Foreign Assets Control (OFAC).

The Secretary of the Treasury, Scott Bessent, stated that the violation's consequences extend far beyond the bank's walls, exposing the U.S. financial system to significant illicit finance risks.

However, the penalty is not the only factor affecting the bank's results. Moynihan admitted that investment banking and sales activities generated lower revenues in the latest quarter, despite an increase in commercial loans, deposits, consumer activity, and wealth management. Despite the penalty, Bank of America's AI-powered investments are helping employees serve clients better, work faster, and manage risk more effectively.

With over 200,000 employees using AI tools and more than 300 approved use cases across the company, Moynihan claims they are transforming their scale into a competitive advantage.