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# Moynihan Says AML Penalty Is Paid And Costs Are 'In The Run Rate' After Analysts Press On Confidence
- URL: https://www.bullished.co/moynihan-says-aml-penalty-is-paid-and-costs-are-in-the-run-rate-after-analysts-press-on-581b8a9d/
- Published: 2026-10-14T14:55:54.000Z
- Updated: 2026-10-23T12:49:17.000Z
- Description: Bank of America's CEO said a $1.2 billion regulatory settlement charge is behind the bank, as analysts questioned whether more costs could follow.
- Author: Matteo Parrino
- Tags: Earnings, BAC, Industry: Financials

[Bank of America](https://www.bullished.co/tag/bac/) Chairman and CEO Brian Moynihan said on the bank's third-quarter earnings call that the anti-money-laundering penalty is resolved, after analysts pressed him on a confidence problem tied to a [$1.2 billion regulatory settlement charge](https://www.cnbc.com/2026/10/14/bank-of-america-bac-q3-2026-earnings.html?ref=bullished.co). The charge is not tax deductible and cost 17 cents per share, he said.

## What management said about the settlement

Moynihan told analysts the ongoing cost of remediation is "embedded in our company's expense base." Net income was $6.9 billion, or [$0.91 per share](https://finance.yahoo.com/markets/article/bank-of-america-profits-tumble-17-as-fines-wall-street-slowdown-dent-lending-income-111824115.html?ref=bullished.co). Excluding the charge, it was $8.1 billion, or about $1.08 per share.

Closing the call, he said "we've resolved the government discussion in the AML area." The penalty was paid in the third quarter, he said, and the expenses are in the run rate.

The settlement follows a December 2024 cease-and-desist order requiring the bank to fix anti-money-laundering deficiencies, [according to regulators](https://qz.com/bank-of-america-earnings-treasury-penalty-money-laundering-101426?ref=bullished.co). Treasury announced the enforcement actions Tuesday, saying the bank failed to timely report more than $5 billion in suspicious transactions. The Office of the Comptroller of the Currency assessed a $750 million civil money penalty, credited toward the total, per qz.com's account.

## Analysts press on confidence and cost

An analyst at JPMorgan said the stock was down over 7% that morning and called the episode a reputational and confidence issue. The analyst asked for a timeline showing the work is behind the bank, not a risk of more charges.

Moynihan said the bank had just resolved the penalty aspect of the order. Costs across the last three quarters have been about $18.5 billion per quarter, he said, "18.6 down to 18.5." He added that the regulators' metrics are now clear.

An analyst at UBS asked about added costs from the third-party review. CFO Alastair Borthwick said the bank has already ramped up people and technology spending, so it is in the run rate. He said the bank started the year with 3,000 more employees than it has now.

Asked by a Jefferies analyst whether the consent order constrains the business, Borthwick said "there's no asset cap here." He said it should not affect clients. Shares traded at $49.85 in Wednesday trading, as of 10:51 a.m. ET, down about 8% from the prior close.

## What to watch

Borthwick said he will likely give guidance for 2027 during the fourth quarter. He said final capital rules are expected then too.

Borthwick said the 2027 guidance will not move below the bank's Investor Day range of 200 to 300 basis points of operating leverage, and could be higher.

### Sources

- [Bank of America (BAC) Q3 2026 earnings](https://www.cnbc.com/2026/10/14/bank-of-america-bac-q3-2026-earnings.html?ref=bullished.co) — CNBC
- [Bank of America Q3 profit tumbles 17% as fines, Wall Street slowdown dent lending income](https://finance.yahoo.com/markets/article/bank-of-america-profits-tumble-17-as-fines-wall-street-slowdown-dent-lending-income-111824115.html?ref=bullished.co) — Yahoo Finance
- [Bank of America Q3 2026 earnings hit by $1.2 billion AML penalty](https://qz.com/bank-of-america-earnings-treasury-penalty-money-laundering-101426?ref=bullished.co) — qz.com
- [Bank of America’s Profit Misses Expectations After $1.2 Billion Treasury Fine](https://www.wsj.com/livecoverage/stock-market-cpi-inflation-10-14-2026/card/bank-of-america-s-profit-misses-expectations-after-1-2-billion-treasury-fine-91Q4INxCEclOn4uvXYd9?ref=bullished.co) — The Wall Street Journal
- [Bank of America fined $1.2 billion by Treasury Department for money laundering and sanctions laws violations | CNN Business](https://www.cnn.com/2026/10/13/investing/bank-of-america-billion-dollar-fine?ref=bullished.co) — CNN

### More on Bank of America

- [Bank Of America Prices $2 Billion Of 7.200% Preferred Stock, With Its Own Affiliate Running The Deal](https://www.bullished.co/bank-of-america-prices-2-billion-of-7-200-preferred-stock-with-its-own-affiliate-running-e7dbc8c5/)
- [Bank Of America's $1.2 Billion Penalty Charge Cuts Third-Quarter Profit To $6.9 Billion From $8.3 Billion](https://www.bullished.co/bank-of-americas-1-2-billion-penalty-charge-cuts-third-quarter-profit-to-6-9-billion-from-0c1cc779/)

[All Bank of America (BAC) coverage →](https://www.bullished.co/tag/bac/)