Mark your calendars: January 14 and 15 will kick off earnings season in earnest, with America's banking giants delivering their Q4 2025 results and—perhaps more importantly—their outlook for 2026. For investors trying to gauge the health of the economy and the direction of markets, few reports carry more weight.

Bank of America, JPMorgan Chase, and Wells Fargo are all scheduled to report before market open on January 14 and 15, setting the tone for what analysts expect to be a consequential earnings season.

What the Street Expects

Analyst expectations suggest a solid quarter for the major banks, continuing a trend of resilient earnings that characterized 2025. For Bank of America specifically, Street expectations for Q4 2025 earnings per share sit at approximately $0.96—up from $0.82 in the same quarter last year.

Looking at full-year projections, Bank of America's FY 2025 EPS expectations hover around $3.81, with FY 2026 expectations climbing to $4.34. That represents healthy earnings growth, but the path to achieving it may be bumpier than the headline numbers suggest.

The Rate Environment Challenge

One of the central questions for bank investors in 2026 is how falling interest rates will affect net interest income—the difference between what banks earn on loans and pay on deposits. After benefiting from the Fed's aggressive rate-hiking campaign in 2022-2023, banks now face the opposite challenge.

According to Deloitte's 2026 banking outlook, net interest income improved by 4% in the first half of 2025 after declining in 2024. However, growth in 2026 could be modest, driven primarily by lower loan yields as the rate-cutting cycle continues.

"Banks are likely to enter 2026 on a relatively strong footing, following resilient earnings in the first three quarters of 2025," Deloitte analysts noted. "However, they may face some headwinds in net interest income in 2026."

Trading and Investment Banking: The Wild Cards

Where falling rates hurt traditional lending margins, they can boost other business lines. Bank of America CEO Brian Moynihan indicated in December that the bank expects markets revenue to rise by high single digits to about 10% in Q4 2025—a sign that trading desks benefited from elevated market volatility.

Investment banking fees, however, are expected to be broadly flat. Despite a surge in M&A activity that made 2025 a record year for deal-making, the advisory pipeline takes time to translate into recognized revenue. The real investment banking payoff may come in the quarters ahead.

Key Themes to Watch

Beyond the headline numbers, investors should focus on several critical themes during earnings calls:

  • Credit quality: With unemployment having risen from 4% in January 2025 to 4.6% by year-end, banks may be seeing early signs of stress in consumer and commercial loan portfolios. Watch for changes in provisions for credit losses.
  • Deposit trends: The competition for deposits intensified as rates rose. How sticky are those deposits now that rates are falling? Outflows could pressure margins.
  • Capital return plans: Banks have been aggressive buyers of their own stock. Listen for commentary on 2026 buyback authorization and dividend policy.
  • Regulatory outlook: With the Trump administration signaling a lighter regulatory touch, banks may provide color on how Basel III modifications and other policy changes affect capital planning.

The Economic Barometer

Bank earnings serve as a real-time economic indicator in ways that few other sectors can match. Consumer spending patterns, business investment appetite, housing market activity, and employment trends all flow through bank balance sheets and income statements.

When Jamie Dimon speaks about economic conditions or Brian Moynihan discusses consumer behavior, markets listen. Their perspectives on the health of the American economy will be closely parsed for signals about whether the "soft landing" narrative remains intact—or whether cracks are forming.

Positioning for Earnings

Bank stocks have rallied into year-end, with investors betting that a steepening yield curve and regulatory relief will boost profitability. The January earnings reports will test whether that optimism is justified.

For long-term investors, the focus should be less on quarter-to-quarter fluctuations and more on the fundamental question: Can banks grow earnings in a normalizing rate environment while managing credit risk appropriately? The answers begin arriving in less than two weeks.