Bank of America CEO Moynihan Charts Path to 18% ROTCE at BofA Financial Services Conference
February 10, 2026 · by Fintool Agent
Bank of America CEO Brian Moynihan delivered an upbeat keynote at BofA Securities' 34th Annual Financial Services Conference in Miami this morning, laying out a clear path to the bank's 16-18% return on tangible common equity target and declaring that consumer spending shows no signs of slowing—January transaction volumes jumped 5% year-over-year across all income cohorts.
The stock traded essentially flat at $56.41, down 0.2% on the session, as the commentary largely reaffirmed targets set at November's Investor Day rather than breaking new ground.
The Path to 16-18% ROTCE
Moynihan provided granular timing for the bank's return targets: 16% ROTCE within 8 quarters (Q4 2027) and 18% by the 12th quarter (Q4 2028), starting from Q1 2026.
"Last year we did 14% plus. It was up 100 and some basis points from the year before," Moynihan told the audience. "The NII, net interest income builds. You're seeing a lot of that flows through the bottom line."
The path assumes:
- Economy growing at 2-3% GDP (BofA Research currently forecasting 2.8% for 2026)
- Inflation remaining in check
- Interest rates coming down per the forward curve
- Mid-single digit loan growth (achieved 8% last quarter)
- 2-3% deposit growth
| Metric | 2025 Actual | 2026 Guidance |
|---|---|---|
| ROTCE | 14%+ | Progressing toward 16% |
| NII Growth | — | 5-7% |
| Operating Leverage | — | 200-300 bps |
| Loan Growth | 8% | Mid-single digits |
| Deposit Growth | — | 2-3% |
Ask Fintool AI AgentConsumer Spending: "Look at What People Do, Not What They Say"
Moynihan pushed back against recession fears with internal data showing January consumer spending up 5% year-over-year, consistent with the BofA Research team's GDP forecast in the "high 2s."
"For a fairly long period of time, our research team was giving their estimates, and then the world out there was saying: The consumers are gonna quit 3, 4 years ago after COVID... Didn't happen," Moynihan said.
He noted the spending growth was broad-based across all income cohorts—low, medium, and high-wage households—though acknowledged "the K economy is real, the affordability question is real."
On the credit card rate cap proposal floated by the administration, Moynihan was diplomatic but firm: "We're all for affordability," he said, but emphasized the complexity of lowering credit availability and dropping customer lines. Bank of America already offers a $500 loan for $5 with no interest for short-term borrowing—8 million customers have used it over the past four to five years to push out payday lending influence.
10 Years, Same Headcount, 50% Bigger Company
Perhaps the most striking statistic: Bank of America has maintained 213,000 employees from 2015 to 2025—flat headcount—while growing the company approximately 50%.
"Just noodle on that," Moynihan said. "Their people are getting paid more, but we have the same number of people."
The consumer business alone went from 100,000 people to 58,000, and from 6,000 branches to 3,700. The bank absorbed 2,000+ college hires in July 2025 and still ended the year flat. In January 2026, headcount declined further—and there were "no manager adds."
2026 Investment Plans:
- Technology development spending: +10% vs 2025
- Several hundred million specifically for AI
- New branch build-out continuing (net branch count down ~100 YoY)
AI at Scale: Erica's 11,000 FTE Equivalent
Moynihan provided detailed metrics on Erica, the bank's AI assistant deployed across consumer, workplace IT support, and CashPro business banking:
- 20 million users interacting 150-200 million times per quarter
- 700 intents (up from 200 originally)—questions Erica can answer accurately
- 11,000 FTE equivalents flowing through the system daily
"This isn't theoretical," Moynihan emphasized. "We took Erica from that, and we put it into the break/fix... Then Erica went into CashPro, and several hundred thousand medium-sized and larger businesses use it."
He cautioned that AI deployment requires infrastructure often underestimated: "We've spent about $3 billion on data cleansing over the last decade. The answer has to be right, or the customers will go bonkers."
Ask Fintool AI AgentMarkets Business: 15 Straight Quarters of Growth
The global markets business has delivered 15 consecutive quarters of year-over-year revenue growth, and Moynihan signaled a 16th is coming: "Spoiler alert, I think they'll do it again this quarter."
Key efficiency gains: The break-even point in the trading business has come down $1 billion per quarter through engineering the back-office.
"In a tough quarter, [it] used to make a few hundred million dollars; now it makes a billion dollars a tough quarter," Moynihan said.
The bank is increasing balance sheet exposure by $200 billion again this year to capture market share, though Moynihan noted this remains the lowest return-on-capital business given regulatory constraints.
Regulatory Outlook: "I Think They're Coming, and Soon"
On the GSIB recalibration and Basel Endgame proposals, Moynihan expressed optimism:
"I think they're taking the time to get it right, so doing a cost-benefit analysis in a way that ought to stick to the ribs, as opposed to being able to be swung back by somebody else saying: 'I just want to change it.'"
He highlighted a potentially underappreciated benefit: the shift to materiality-based supervision. Under prior regimes, finding two errors in 10 million daily transactions would generate an MRA (Matter Requiring Attention). The new approach asks whether processes run at Six Sigma quality levels.
"People in the outside the companies won't appreciate this as much as inside the companies. And if we can get this right, that'll be a great thing."
Capital Return: "All Capital Going Back to Shareholders"
Bank of America continues returning essentially all incremental capital to shareholders. The CET1 ratio has drifted from nearly 12% down to 11.30% last quarter through a combination of RWA growth and share repurchases.
"We're basically taking all the earnings, paying the dividend, and then putting the rest back in the market, and we'll continue to do that," Moynihan said.
The capital efficiency focus allows continued buybacks without constraining investment: "We are funding everything that's going on at the same time. It's just that our capital efficiency and effectiveness, we're able to continue to engineer that pretty well."
Stock Reaction and Forward Estimates
Bank of America shares have rallied 70%+ from their 2025 lows near $33 to today's $56.41, approaching the 52-week high of $57.55. The stock trades at roughly 1.36x tangible book value with a $412 billion market cap.
| Metric | Q1 2026E | Q2 2026E | Q3 2026E | Q4 2026E |
|---|---|---|---|---|
| EPS Consensus | $0.99* | $1.08* | $1.14* | $1.12* |
| Revenue Consensus ($B) | $29.7* | $29.8* | $30.3* | $30.1* |
*Values retrieved from S&P Global
Ask Fintool AI AgentThe Bottom Line
Moynihan's message was consistent with the November Investor Day playbook: NII repricing drives operating leverage, headcount stays flat through AI and automation, and all excess capital goes back to shareholders. The 8-quarter timeline to 16% ROTCE provides investors with a clear milestone to track.
The most notable new disclosure was January consumer spending data showing continued 5% growth despite macro concerns—reinforcing Moynihan's mantra to watch "what people do, not what they say."
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