NEW YORK — Four of the nation’s biggest banks reported higher fourth-quarter and full-year profits this week, but the results failed to impress investors, sending bank shares sharply lower.
Bank of America said fourth-quarter net income rose 12% from a year earlier to $7.6 billion, topping analysts’ expectations of $7.4 billion. Earnings were $0.98 per share, ahead of forecasts, according to the New York Times.
Wells Fargo reported a 6% increase in quarterly net income to $5.4 billion, matching estimates. Earnings were $1.62 per share, short of forecasts for $1.67, reflecting a $0.14-per-share impact from severance costs during the quarter, the Times added.
Share Values Fall
The report noted shares of Wells Fargo fell more than 5% by Wednesday afternoon. Bank of America shares slid nearly 5%. Profits also fell at Citigroup, which said fourth-quarter net income declined 13% from a year earlier to $2.5 billion. The results included a $1.2 billion loss tied to the planned sale of the bank’s Russia unit. Citigroup shares dropped nearly 5%.
Revenue growth at Bank of America and Wells Fargo was driven by higher lending margins and fee income compared with a year earlier. Bank of America’s firmwide revenue rose 7% to $28 billion, while Wells Fargo posted a 4% increase to $21.3 billion.
In addition, both Goldman Sachs and Morgan Stanley report strong results. A rise in investment banking revenue helped bolster both Wall Street giants’ bottom lines: Goldman reported $4.38 billion in quarterly profit attributable to shareholders, while Morgan Stanley disclosed $4.4 billion in net income.
Optimistic Tone
Despite the market reaction, chief executives at the nation’s second-, third- and fourth-largest banks struck an optimistic tone about the outlook for the U.S. economy and their institutions, the Times said.
“While any number of risks continue, we are bullish on the U.S. economy in 2026,” BofA CEO Brian Moynihan said in a statement.
Wells Fargo CEO Charles Scharf pointed to the easing of long-standing regulatory growth restrictions last summer, saying the bank is now “able to dedicate even more resources to growth with the ability to grow our balance sheet.”
