Wall Street Reports a Mixed Earnings Bag in Q4

Well, that was a mixed bag.

It was a major week for financial institutions, with a hefty handful of the biggest players reporting fourth-quarter earnings yesterday. There were signs of strength, with Bank of America posting record fourth-quarter income in its wealth unit, but overall, investors were unimpressed. Wells Fargo’s stock fell 5% Wednesday, while Bank of America’s and JPMorgan’s declined 4%. The earnings calls may not have been what some analysts were expecting, but executives said they were still focused on growing wealth management segments despite the earnings misses. 

“We are … focusing on serving our bank and wealth management customers, which will help improve profitability,” Wells Fargo CEO Charlie Scharf said on an earnings call.

We’re Interested

Part of the problem for Wells Fargo was a miss on net interest income — the difference between what it earns on loans and pays on deposits, and a revenue stream that has been dwindling across the industry in recent years. The shortcoming was due, in part, to a $1.95 trillion asset cap the Federal Reserve imposed in 2018, but removed in June of last year, Scharf said. The fourth quarter of 2025 was the first full quarter that the bank operated without the cap. “The removal of the asset cap by the Federal Reserve was a pivotal moment for the company,” he said. 

Bank of America’s wealth management unit was a bright spot, recording net income of $1.4 billion in the fourth quarter. That was good for a 20% increase year over year. The parent company of Merrill Lynch aslo reported: 

• More than $2.2 trillion of AUM balances, up 16% for the quarter.
• Some 21,300 net new client relationships in the wealth unit last year.
• Because of increased asset-management fees, the unit’s total revenue topped $6.6 billion.

Meanwhile, the asset and wealth management unit at JPMorgan performed strongly, with assets under management climbing 18% year over year and revenue topping $6.5 billion. Lower-than-expected investment banking fees, however, were due to deals that didn’t end up happening last quarter. “IB fees were down 5% year-on-year, reflecting a strong prior year… and the timing of some deals that were pushed to 2026,” Chief Financial Officer Jeremy Barnum said on the company’s earnings call.

Spreading the Wealth(front). Wealthfront also released its first earnings report this week that showed some slowing in asset flows last month, leading its stock to tumble 14%. Still, its net income for the quarter was $30.9 million, up 3% year over year.