Equity Derivatives House: Bank of America
Balanced powerhouse
2025 provided a host of money-making opportunities for banks’ equity derivatives operations as traders revelled in the intermittent bouts of volatility, while structured desks enjoyed growing client demand for their products. For expanding its structured business to complement its strength in flow trading, Bank of America is IFR’s Equity Derivatives House of the Year.
The record-breaking run for banks’ equities divisions accelerated in 2025 as tariffs and AI fever jolted investors into action and sent trading volumes soaring.
For Bank of America, it provided an important litmus test for its revamped equity derivatives operations, which have sought to balance strength in flow trading with an expansion in structured solutions to create a more diverse and well-rounded franchise.
The results are compelling. BofA’s global equity derivatives revenues are on track for double-digit growth in 2025 after already jumping a whopping 50% year on year in 2024.
That follows several years of targeted investments in technology, personnel and products that have vaulted BofA up the rankings in structured notes and allowed it to register impressive growth in other activities including quantitative investment strategies, custom baskets and hybrid derivatives.
“We have one of the largest flow businesses across banks but over the past few years, to complement that, we [have] built a very strong structured business,” said Youssef Brahimi, global head of equity structuring. “We’re really becoming a structured powerhouse in addition to being a flow powerhouse.”
BofA’s new-look structured notes business exemplifies the firm’s progress in equity derivatives. The bank says it is now the third-largest US structured notes issuer, up from 11th place in 2020. But perhaps even more impressively, BofA has also gained significant ground outside its home market.
BofA’s increased headcount across trading, sales and structuring has seen it triple the number of clients onboarded over the past three years in the European structured notes market. That includes adding nearly 100 new clients in 2025 alone, and BofA has nearly tripled its European issuance over the past year as a result.
“We’re pretty much the last bank to come into that business and yet we see [growing] confidence from clients [because of] the quality of [our] team,” said Alexandre Isaaz, EMEA head of equity derivatives sales and structuring. “The number of clients, number of jurisdictions and the number of notes keep on [growing]. [We’re seeing] exponential growth from that perspective.”
Innovative structures have helped establish BofA as a disruptor in these famously crowded markets. That includes designing a new product aimed at Swiss clients wanting to invest in the US stock market without getting penalised due to the unfavourable differential between Swiss and US interest rates.
“What we’ve done for distribution in Switzerland … is a good testament of innovation … that is simple yet elegant,” said Raphael Cyna, global head of payoff structuring.
BofA’s global equities QIS is on track for another record year as it continues to benefit from its focus on innovative structuring. In the US insurance market, for instance, BofA’s targeted volatility indices have proved a hit for providing clients with a more stable and predictable returns profile, helping the bank win a record seven fixed-index annuity mandates this year.
“One of the goals of the QIS business over the last few years has really been diversification … whether that’s diversification across product type … client type, or the actual underlying itself,” said Ben Barr, global head of equity QIS structuring.
Elsewhere, BofA’s expansion in hybrid derivatives has come as demand has surged for these complex, multi-asset structures. The bank said it has increased its client coverage in hybrids by five times over the past three years, leading to a record year for the business in 2025.
Similarly, BofA has invested this year to increase its presence in custom baskets by hiring three staff focused on the products.
“The fact that we cover a full arsenal of solutions has allowed us to really navigate through the cycle,” said Vincent Charvin, head of delta one sales. “For every market cycle, there is a way, through our products, to help our clients.”