Afraid of missing out on the OpenAI IPO? Bank of America makes a major shift, offering it a $520 million credit line.

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The 180-degree shift in Bank of America's attitude toward OpenAI reflects the increasingly irresistible lure of profits facing Wall Street in the AI boom.

According to Bloomberg, citing insiders, Bank of America recently provided OpenAI with a $520 million credit line, after previously rejecting the AI giant's financing request. This move brings OpenAI's total available credit beyond $5 billion.

OpenAI is preparing for its first public offering, a prospect that is the key factor prompting Bank of America to change its stance—a major mistake for Bank of America, with its vast Merrill Lynch wealth management team, would be to miss out on what could be a record-setting large U.S. IPO deal.

This shift sends a direct signal to the market. Bank of America's involvement shows that even the most conservative major lending institutions on Wall Street are beginning to incorporate IPO expectations for leading AI companies into their credit decision logic, rather than solely relying on traditional profitability assessments.

Conservative DNA: Why Bank of America missed the first round of financing

Bank of America CEO Brian Moynihan has led the bank for more than fifteen years, centering his management philosophy on "responsible growth" and deliberately avoiding high-risk exposures during various crises. This approach has made Bank of America renowned for stability within the industry, but it has also caused the bank to repeatedly miss offensive opportunities.

This caution was particularly apparent regarding OpenAI's financing. In October 2024, OpenAI formed a syndicate of nine global banks to secure a $4 billion revolving credit facility, with top U.S. peers like JPMorgan, Goldman Sachs, and Morgan Stanley all participating—yet Bank of America was notably absent.

In March this year, OpenAI expanded the facility to $4.7 billion and brought in two more banks, but Bank of America was still missing. Insiders said the bank needed more time for due diligence and to push the credit decision through internal approval processes at that time.

Nevertheless, Bank of America is not entirely avoiding the AI ecosystem—it previously participated in financing for Oracle's data center construction in Michigan, but has consistently kept its distance from directly establishing a credit relationship with OpenAI.

Historical Scars: Where CEO Moynihan’s Risk Philosophy Comes From

Moynihan, now 66, took over Bank of America after the 2008 financial crisis, leading the bank out of the mess left by his predecessor and earning widespread acclaim.

However, his wariness toward risk comes from earlier personal experience. Over twenty years ago, he was an ascending executive at FleetBoston, and witnessed firsthand the bank suffering over $500 million losses in the Argentine market. Since then, Moynihan has prioritized avoiding major mistakes above maximizing profits.

In 2017, while many Wall Street institutions brushed off losses from margin loans after South African retailer Steinhoff collapsed, Bank of America proactively shrank that business line—just missing out on the subsequent boom in financing clients as a major revenue source for competitors.

An even more costly decision came during the COVID pandemic: Bank of America made massive purchases of long-term, low-interest bonds as rates hit bottom, eroding profitability for years and putting it at a competitive disadvantage.

Although the bank's stock hit a record high this week, its cumulative performance over the past five years still significantly lags all major competitors. Reportedly, several mid-level managers privately complain that these risk restrictions have caused them to miss out on numerous business opportunities.

IPO Logic: The Implicit Game Between Bank Credit and Underwriting Seats

For top Silicon Valley tech companies, obtaining bank credit support during expansion and IPO preparations has already become routine. Investment banks competing for prestigious IPO underwriting slots often hope their own credit business will provide a competitive edge—though this benefit exchange is not explicitly stated.

OpenAI has commissioned Goldman Sachs and Morgan Stanley to assist in submitting confidential IPO filings, and is negotiating with other banks about joining the underwriting syndicate. OpenAI has completed a new financing round this year, with a valuation as high as $852 billion, demonstrating investors' ongoing willingness to bet heavily on the cost-no-object AI race.

However, OpenAI is cautious about its IPO timetable. When disclosing its confidential filing, the company stated: "We haven't decided on a schedule yet; it may still take a while." Previous reports indicated OpenAI may delay its IPO until next year. Ample private financing and credit lines have given it a larger time window.

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