Bank of America discusses stress test outcomes and intends to boost quarterly dividend by 8 percent

Bank of America has recently commented on the outcomes of the 2025 Comprehensive Capital Analysis and Review (CCAR) carried out by the Federal Reserve. Following these results, the company has decided to increase its quarterly common stock dividend to $0.28 per share commencing in the third quarter of 2025.

The stress test results for 2025 revealed an improvement in Bank of America’s modeled capital depletion by 100 basis points to 170 basis points. Capital depletion signifies the variance between a firm’s CET1 capital ratios at the beginning and in the most stressed period of the test scenario. Consequently, in compliance with current Federal Reserve regulations, the preliminary stress capital buffer (SCB) for Bank of America would enhance by 70 basis points to 2.5%, with the CET1 minimum requirement set at 10.0%, effective from October 1, 2025.

The Federal Reserve has recently proposed alterations to the SCB calculation method. Should these rule changes be implemented as recommended, Bank of America’s stress test results for 2025 would reveal an SCB of 2.7%, thereby establishing a new CET1 minimum ratio of 10.2%, effective January 1, 2026.

By March 31, 2025, Bank of America had amassed regulatory CET1 capital totaling $201 billion with a CET1 ratio standing at 11.8%, exceeding the current minimum stipulation. However, it is important to note that the quarterly common stock dividend increase is still pending approval by Bank of America’s Board of Directors.

In light of these developments, it is imperative to highlight that the content of this news release may contain forward-looking statements subject to the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect Bank of America’s current expectations based on the available information and do not strictly pertain to historical or current facts. These statements utilize language such as “expects,” “anticipates,” “believes,” “estimates,” and other similar expressions or future-oriented verbs like “will,” “may,” and “should.”

It is essential to bear in mind that forward-looking statements only represent Bank of America’s current projections of its future outcomes, revenues, expenses, dividends, capital measures, and prevailing business and economic conditions. Furthermore, these statements do not assure future results or performance, owing to various known and unknown risks, uncertainties, and factors beyond the company’s control.

Conclusively, while these forward-looking statements provide insights into Bank of America’s strategic direction and financial outlook, it is crucial not to place undue reliance on them, considering the unpredictable nature of market conditions, potential economic shifts, and unforeseen challenges that could impact the actual outcomes compared to the expressed expectations.