BANK OF AMERICA CORP /DE/
For the period ended Sep 30, 2025. Filed Oct 31, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Oct 31, 2025
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Allowance for Credit Losses
The allowance for credit losses increased $25 million from December 31, 2024 to $14.4 billion at September 30, 2025, which included a $110 million reserve decrease and $135 million reserve increase related to the consumer and
commercial portfolios, respectively.
Table 36 presents an allocation of the allowance for credit losses by product type at September 30, 2025 and December 31, 2024.
| Table 36 | Allocation of the Allowance for Credit Losses by Product Type | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Amount · Percent ofTotal · Percent ofLoans andLeasesOutstanding (1) · Amount · Percent ofTotal · Percent ofLoans andLeasesOutstanding (1) | ||||||||||
| (Dollars in millions) · September 30, 2025 · December 31, 2024 | ||||||||||
| Allowance for loan and lease losses | ||||||||||
| Residential mortgage | $321 | 2.42% | 0.14% | $264 | 1.99% | 0.12% | ||||
| Home equity | 87 | 0.66 | 0.33 | 29 | 0.22 | 0.11 | ||||
| Credit card | 7,272 | 54.87 | 7.12 | 7,515 | 56.76 | 7.26 | ||||
| Direct/Indirect consumer | 713 | 5.38 | 0.64 | 700 | 5.29 | 0.65 | ||||
| Other consumer | 59 | 0.45 | n/m | 62 | 0.47 | n/m | ||||
| Total consumer | 8,452 | 63.78 | 1.78 | 8,570 | 64.73 | 1.84 | ||||
| U.S. commercial (2) | 2,896 | 21.85 | 0.64 | 2,637 | 19.91 | 0.65 | ||||
| Non-U.S. commercial | 813 | 6.13 | 0.55 | 778 | 5.88 | 0.57 | ||||
| Commercial real estate | 1,045 | 7.89 | 1.56 | 1,219 | 9.21 | 1.85 | ||||
| Commercial lease financing | 46 | 0.35 | 0.28 | 36 | 0.27 | 0.23 | ||||
| Total commercial | 4,800 | 36.22 | 0.70 | 4,670 | 35.27 | 0.75 | ||||
| Allowance for loan and lease losses | 13,252 | 100.00% | 1.14 | 13,240 | 100.00% | 1.21 | ||||
| Reserve for unfunded lending commitments | 1,109 | 1,096 | ||||||||
| Allowance for credit losses | $14,361 | $14,336 | ||||||||
(1)Ratios are calculated as allowance for loan and lease losses as a percentage of loans and leases outstanding excluding loans accounted for under the fair value option.
(2)Includes allowance for loan and lease losses for U.S. small business commercial loans of $1.4 billion and $1.2 billion at September 30, 2025 and December 31, 2024.
Net charge-offs for the three months ended September 30, 2025 decreased $167 million to $1.4 billion compared to $1.5 billion for the same period in 2024 driven by asset quality improvement in credit card and commercial. Net charge-offs for the nine months ended September 30, 2025 decreased $221 million to $4.3 billion compared to $4.6 billion for the same period in 2024 driven by asset quality improvement in commercial real estate office. The provision for credit losses decreased $247 million to $1.3 billion for the three months ended September 30, 2025 and remained relatively unchanged at $4.4 billion for the nine months ended September 30, 2025 as compared to the same periods in 2024. The decrease in the provision for credit losses for the three months ended September 30, 2025 was primarily due to improved asset quality in credit card. The provision for credit losses for the nine months ended September 30, 2025 was impacted by improved asset quality in credit card and commercial real estate, partially offset by the dampened macroeconomic outlook and loan growth in commercial. The provision for credit losses for the
consumer portfolio, including unfunded lending commitments, decreased $266 million to $859 million and $135 million to $3.0 billion for the three and nine months ended September 30, 2025 compared to the same periods in 2024. The provision for credit losses for the commercial portfolio, including unfunded lending commitments, increased $19 million to $436 million and $133 million to $1.3 billion for the three and nine months ended September 30, 2025 compared to the same periods in 2024.
Table 37 presents a rollforward of the allowance for credit losses, including certain loan and allowance ratios for the three and nine months ended September 30, 2025 and 2024. For more information on the Corporation’s credit loss accounting policies and activity related to the allowance for credit losses, see Note 1 – Summary of Significant Accounting Principlesto the Consolidated Financial Statements of the Corporation’s 2024 Annual Report on Form 10-K and Note 5 – Outstanding Loans and Leases and Allowance for Credit Losses to the Consolidated Financial Statements.
| Table 37 · Allowance for Credit Losses | ||||
|---|---|---|---|---|
| Three Months Ended September 30 | Nine Months Ended September 30 | |||
| (Dollars in millions) | 2025 | 2024 | 2025 | 2024 |
| Allowance for loan and lease losses, beginning of period | $13,291 | $13,238 | $13,240 | $13,342 |
| Loans and leases charged off | ||||
| Residential mortgage | (6) | (5) | (18) | (18) |
| Home equity | (3) | (10) | (11) | (16) |
| Credit card | (1,083) | (1,084) | (3,409) | (3,235) |
| Direct/Indirect consumer | (88) | (101) | (274) | (292) |
| Other consumer | (59) | (71) | (195) | (221) |
| Total consumer charge-offs | (1,239) | (1,271) | (3,907) | (3,782) |
| U.S. commercial (1) | (326) | (288) | (868) | (710) |
| Non-U.S. commercial | — | (60) | (8) | (61) |
| Commercial real estate | (135) | (180) | (471) | (762) |
| Commercial lease financing | (1) | (1) | (4) | (2) |
| Total commercial charge-offs | (462) | (529) | (1,351) | (1,535) |
| Total loans and leases charged off | (1,701) | (1,800) | (5,258) | (5,317) |
| Recoveries of loans and leases previously charged off | ||||
| Residential mortgage | 7 | 7 | 17 | 17 |
| Home equity | 14 | 15 | 44 | 48 |
| Credit card | 203 | 156 | 574 | 453 |
| Direct/Indirect consumer | 33 | 45 | 102 | 120 |
| Other consumer | 4 | 4 | 14 | 13 |
| Total consumer recoveries | 261 | 227 | 751 | 651 |
| U.S. commercial (2) | 57 | 29 | 133 | 72 |
| Non-U.S. commercial | — | — | 1 | 13 |
| Commercial real estate | 15 | 9 | 26 | 15 |
| Commercial lease financing | 1 | 1 | 3 | 1 |
| Total commercial recoveries | 73 | 39 | 163 | 101 |
| Total recoveries of loans and leases previously charged off | 334 | 266 | 914 | 752 |
| Net charge-offs | (1,367) | (1,534) | (4,344) | (4,565) |
| Provision for loan and lease losses | 1,328 | 1,547 | 4,354 | 4,479 |
| Other | — | — | 2 | (5) |
| Allowance for loan and lease losses, September 30 | 13,252 | 13,251 | 13,252 | 13,251 |
| Reserve for unfunded lending commitments, beginning of period | 1,143 | 1,104 | 1,096 | 1,209 |
| Provision for unfunded lending commitments | (33) | (5) | 13 | (110) |
| Other | (1) | 1 | — | 1 |
| Reserve for unfunded lending commitments, September 30 | 1,109 | 1,100 | 1,109 | 1,100 |
| Allowance for credit losses, September 30 | $14,361 | $14,351 | $14,361 | $14,351 |
| Loan and allowance ratios (3): | ||||
| Loans and leases outstanding at September 30 | $1,159,206 | $1,071,628 | $1,159,206 | $1,071,628 |
| Allowance for loan and lease losses as a percentage of total loans and leases outstanding at September 30 | 1.14% | 1.24% | 1.14% | 1.24% |
| Consumer allowance for loan and lease losses as a percentage of total consumer loans and leases outstanding at September 30 | 1.78 | 1.87 | 1.78 | 1.87 |
| Commercial allowance for loan and lease losses as a percentage of total commercial loans and leases outstanding at September 30 | 0.70 | 0.76 | 0.70 | 0.76 |
| Average loans and leases outstanding | $1,146,430 | $1,055,975 | $1,119,173 | $1,049,689 |
| Annualized net charge-offs as a percentage of average loans and leases outstanding | 0.47% | 0.58% | 0.52% | 0.58% |
| Allowance for loan and lease losses as a percentage of total nonperforming loans and leases at September 30 | 248 | 235 | 248 | 235 |
| Ratio of the allowance for loan and lease losses at September 30 to annualized net charge-offs | 2.44 | 2.17 | 2.28 | 2.17 |
| Amounts included in allowance for loan and lease losses for loans and leases that are excluded from nonperforming loans and leases at September 30 (4) | $8,549 | $8,640 | $8,549 | $8,640 |
| Allowance for loan and lease losses as a percentage of total nonperforming loans and leases, excluding the allowance for loan and lease losses for loans and leases that are excluded from nonperforming loans and leases at September 30 (4) | 88% | 82% | 88% | 82% |
(1)Includes U.S. small business commercial charge-offs of $147 million and $443 million for the three and nine months ended September 30, 2025 compared to $135 million and $383 million for the same periods in 2024.
(2)Includes U.S. small business commercial recoveries of $13 million and $42 million for the three and nine months ended September 30, 2025 compared to $11 million and $33 million for the same periods in 2024.
(3)Ratios are calculated as allowance for loan and lease losses as a percentage of loans and leases outstanding excluding loans accounted for under the fair value option.
(4)Primarily includes amounts related to credit card and unsecured consumer lending portfolios in Consumer Banking.
41 Bank of America
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