Bank of America Projects Q4 NII, IB & Wealth Management Fees to Rise

Core Viewpoint - Bank of America Corp. (BAC) maintains an optimistic outlook for 2025, driven by cooling inflation, anticipated rate cuts, and favorable regulatory changes under the Trump administration [1]. Group 1: Net Interest Income (NII) - BAC expects NII to rise sequentially to $14.3 billion in Q4 2024, supported by higher loans and lower deposit costs in a declining rate environment [2]. - For 2025, NII is predicted to increase sequentially each quarter due to expected interest rate cuts, with net interest margin also anticipated to rise [3]. Group 2: Fee Income - Wealth management fees are projected to increase by 20% year-over-year in Q4 2024, while investment banking fees are expected to rise by 25% year-over-year [4]. - Trading fees are anticipated to reach record levels in Q4 2024, with an increase in the mid-to-high single digits compared to the prior year [5]. Group 3: Expenses - BAC forecasts core expenses to remain stable in Q4 2024, with total non-interest expenses expected to hold steady at$ 16.5 billion [6]. - For 2025, non-interest expenses are anticipated to rise at half the inflationary rate, with operating leverage expected to gradually improve [7]. Group 4: Loans & Deposits - Loan growth is expected to be around 4% or higher in 2024, primarily driven by commercial loans, while mortgage loans are not expected to grow significantly [7]. - Deposits are projected to reach nearly $30 billion by the end of Q4 2024, indicating sequential growth [8]. Group 5: Credit Costs - BAC anticipates credit costs to remain flat in Q4 2024 compared to the same quarter last year [9]. Group 6: Stock Performance - Year-to-date, BAC shares have increased by 36.7%, compared to the industry's growth of 42% [10].