Wall Street's Biggest Banks Face Q3 Earnings Test as Treasury Yields Surge

Profits are expected to rise from a year ago, but falling bank shares say investors want proof that higher yields help more than they hurt

October 11, 2026 — The six largest U.S. banks open third-quarter earnings season on October 13-14, facing a rise in Treasury yields, a recent Federal Reserve rate increase, and stock prices that have retreated from summer highs.

Image: Wall Street bank towers at dawn under a rising yield curve, illustrating the Q3 earnings test for the biggest U.S. banks. Credit: AI-generated illustration / Red Eye Eagle News, original illustration.

Editor's Highlight: This is not a story about weak forecasts. Analysts expect every one of the six banks to earn more per share than a year ago. The question is whether lending income, trading and credit quality can calm a market that has already marked bank shares down.

Table of Contents

• Key Facts
• Who Reports, and When
• Why the Sequential Comparison Looks Weak
• Trading: Equities Strong, Fixed Income Softer
• Net Interest Income and the Yield Curve
• Credit Quality and Commercial Real Estate
• Bottom Line
• FAQ
• Sources

Key Facts

Detail	Information
Reporting dates	October 13 and 14, 2026
October 13 banks	JPMorgan Chase, Citigroup, Wells Fargo, Goldman Sachs
October 14 banks	Bank of America, Morgan Stanley
Fed policy rate	3.75% to 4.00%, raised September 16
10-year Treasury yield	Around 5.3%, highest since 2002
Combined equities trading	Forecast near $19 billion for five largest banks
Bank index move	KBW Bank Index down about 13% from August peak
Market value lost	About $270 billion from summer highs for five banks

Who Reports, and When

JPMorgan Chase, Citigroup, Wells Fargo and Goldman Sachs report on Tuesday, October 13, before the open in most schedules.

Bank of America and Morgan Stanley follow on Wednesday, October 14. Together, the six set the tone for the wider earnings season.

Newsroom Focus: September consumer price data arrives the same week, shaping Fed expectations alongside the bank results.

Why the Sequential Comparison Looks Weak

Second-quarter results were unusually strong. All six banks acted as joint bookrunners on the SpaceX initial public offering in June, which raised $85 billion, according to the MarketWatch report.

Without a repeat, noninterest income is expected to fall sharply from that level.

The year-over-year picture is different. FactSet estimates cited by MarketWatch show all six banks posting higher earnings per share than in the third quarter of 2025.

Bank	Estimated Q3 EPS
JPMorgan Chase	$5.93, vs. $5.07 a year ago
Bank of America	$1.10, vs. $1.06 a year ago
Citigroup	$2.65, vs. $1.86 a year ago
Wells Fargo	$1.85, vs. $1.66 a year ago
Goldman Sachs	$12.86, vs. $12.25 a year ago
Morgan Stanley	$2.93, vs. $2.80 a year ago

Benzinga data put options implied moves between 3.65% for JPMorgan and 5.00% for Wells Fargo.

Analysis Note: A sequential decline after an exceptional quarter is not, on its own, a warning sign. Guidance for the fourth quarter will matter more.

Trading: Equities Strong, Fixed Income Softer

Equities trading remains the strongest markets business. The five largest banks are expected to report combined stock-trading revenue approaching $19 billion for the quarter, according to Beinsure analysts.

Goldman Sachs is projected, according to those estimates, at about $5.1 billion in equities trading revenue. Morgan Stanley follows at about $4.9 billion, and JPMorgan at about $4.5 billion.

Fixed income has cooled more. Combined markets revenue for the five largest banks is forecast at about $38.9 billion, up roughly 17% from a year ago, compared with about 30% growth in the second quarter.

Bank of America has warned, according to the reports, that investment-banking fees could fall by at least 10%.

JPMorgan Chase has guided, according to the company outlook cited in the reports, to fees and trading revenue rising by mid-to-high-teen percentages — expectations, not results.

Net Interest Income and the Yield Curve

Higher yields can help when loans reprice faster than deposits — the case analysts will test in net interest income (NII).

FactSet estimates cited by MarketWatch put JPMorgan's expected NII at about $26.88 billion, up 5.4% from the second quarter and 12.2% from a year ago.

Bank of America's expected NII is about $16.48 billion, up 3.0% sequentially and 8.2% year over year in the same estimates.

The risk runs the other way: higher deposit and wholesale funding costs, and lower values for bonds bought when rates were lower.

Practical Takeaway: Bank commentary on loan demand and credit will signal how much of the yield rise is reaching households and smaller companies.

Credit Quality and Commercial Real Estate

Credit is the other test, especially for smaller borrowers with floating-rate debt.

Commercial real estate remains a watch point. The report cited Deutsche Bank research putting the specially serviced rate for securitized commercial real-estate loans at 12%.

For loans on bank balance sheets, a Brean Capital analyst cited in the report put the criticized-loan rate closer to 4% to 5%.

Beinsure cited a Truist Securities survey: only 35% of institutional investors now expect bank stocks to outperform, down from 68% in July.

The SPDR S&P Regional Banking ETF has fallen about 11% from its mid-August high, according to Benzinga.

Bottom Line

The big banks enter earnings season with forecasts up from a year ago, strong equities trading, and expected NII growth at the largest lenders.

What to watch next is guidance on deposit costs, loan demand, fixed-income trading and credit on October 13 and 14.

FAQ

Which banks report on October 13?

JPMorgan Chase, Citigroup, Wells Fargo and Goldman Sachs report on October 13. Bank of America and Morgan Stanley follow on October 14.

Why are profits expected to fall from the second quarter?

The second quarter included fees from SpaceX's $85 billion IPO in June, in which all six banks were joint bookrunners. That exceptional activity is not expected to repeat at the same scale.

How have bank shares performed?

The KBW Bank Index has fallen about 13% from its August peak. Five major banks have together lost about $270 billion in market value from summer highs, according to Beinsure.

What is the rate backdrop?

The Fed raised its policy rate to 3.75% to 4.00% on September 16, its first increase since July 2023. The 10-year Treasury yield trades around 5.3%, the highest since 2002.

What will investors watch most closely?

Net interest income, deposit costs, trading revenue, investment-banking fees, credit quality and fourth-quarter guidance.

Sources

• Morningstar / MarketWatch (Dow Jones) — FactSet EPS and NII estimates, SpaceX comparison and credit: https://www.morningstar.com/news/marketwatch/202610114/bank-earnings-to-shed-the-first-light-on-how-higher-yields-are-affecting-the-economy
• EIN Presswire / Beinsure — $19 billion equities trading forecast, $270 billion market value decline and Truist survey: https://world.einnews.com/pr_news/948851099/beinsure-forecast-wall-street-s-biggest-banks-face-rising-rates-in-q3-earnings-after-strong-h1-2026
• TradingView / Benzinga — Reporting dates, implied moves, Fed hike and regional bank ETF: https://in.tradingview.com/news/benzinga:55ba3ba59094b:0-earnings-volatility-watch-jpmorgan-goldman-kick-off-q3-season-but-these-10-stocks-are-priced-for-bigger-swings/
• FXEmpire — Week ahead calendar confirming October 13-14 schedule: https://www.fxempire.com/forecasts/article/the-week-ahead-jpmorgan-goldman-sachs-earnings-and-cpi-test-stock-market-strength-1637135
• Hero image — AI-generated illustration / Red Eye Eagle News, original illustration.