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Bank of America is changing its accounting methods for tax-related equity investments in affordable housing and…
BACBank of America Corp
Bank of America is changing its accounting methods for tax-related equity investments in affordable housing and renewable energy, shifting from the equity method to the proportional amortization method. While the change has a negligible impact on annualized net income, it resulted in a $1.7 billion reduction in retained earnings as of September 30, 2025, and would have decreased the Common Equity Tier 1 ratio by approximately 13 basis points. This reclassification primarily shifts amounts between noninterest income and income tax expense, which may alter how investors interpret the company's revenue and effective tax rate.