Wall Street Roars Back with Record Earnings
Wall Street’s Big Banks Reap the Rewards of a Dealmaking Revival
Bank of America (BAC) and Morgan Stanley (MS) delivered impressive third-quarter earnings as Wall Street dealmaking resurgence powered profits sharply higher.
Bank of America’s profit jumped 23% to $8.47 billion, while Morgan Stanley’s soared 45% to $4.6 billion—each exceeding analyst expectations by more than $1 billion.
The standout performance was fueled by a boom in mergers, acquisitions, and IPOs that gathered pace over the summer. Investment banking fees surged 43% at Bank of America to $2 billion, and 44% at Morgan Stanley to $2.1 billion from a year earlier.
Trading also played a key role. Bank of America’s trading revenue rose 8% to $5.3 billion, while Morgan Stanley’s climbed 24%, lifting total trading income to $6.28 billion across equities, fixed income, currency, and commodities.
Morgan Stanley CEO Ted Pick described the quarter as “outstanding,” and Bank of America’s Brian Moynihan credited “strong fee performance from our market-facing businesses.”
The results add momentum to what’s becoming a strong quarter across major U.S. banks. Bank of America secured the lead role advising Union Pacific’s $71 billion acquisition of Norfolk Southern, the year’s largest deal so far. Morgan Stanley also advised on that merger and co-facilitated Keurig Dr Pepper’s $18 billion purchase of JDE Peet’s.
Following their reports, Bank of America shares rose 4%, and Morgan Stanley’s gained over 6% in early trading.
Other banking heavyweights—Goldman Sachs, JPMorgan Chase, Citigroup, and Wells Fargo—also beat expectations, thanks to similar tailwinds.
- Goldman Sachs: investment banking fees up 42% to $2.65 billion
- JPMorgan: up 17% to $2.61 billion
- Citigroup: up 17% to $1.17 billion
- Wells Fargo: up 25% to $840 million
Banks are benefiting from a faster merger approval process and looser capital requirements under the Trump administration—conditions that have revived Wall Street’s appetite for big deals.
Commenting on the current landscape, Morgan Stanley’s Ted Pick noted that “macro uncertainty and enormous opportunity uncomfortably coexist,” likening the environment to the mid-1990s era of rapid financial expansion.
Beyond Wall Street, Main Street lending also strengthened. Bank of America’s net interest income rose 9% year-over-year to $15.38 billion, setting a new record for quarterly lending revenue and underscoring continued resilience in its core business.
