Bank of America to Incur $1.6B Charge Due to Bloomberg Benchmark Phase-Out

The bank expects to recover the amount through interest income over the next few years, with the majority expected by 2026.

• Bank of America expects to incur a net non-cash, pretax charge of about $1.6 billion in Q4 FY23 due to the phasing out of the Bloomberg Short-Term Bank Yield Index (BSBY).
• The bank expects the amount to be recognized back into its interest income in subsequent periods, mostly through 2026.
• The one-time charge lowered BAC's common equity tier 1 (CET1) ratio by eight basis points.
• Bloomberg Index Services Limited disclosed the permanent cessation of BSBY and all its tenors, effective November 15, 2024.
• BAC shares are trading lower by 0.50% at $33.99 premarket on the last check Tuesday.

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