In April, the Fed required Bank of America to resubmit its capital plan and to suspend planned increases in capital distributions after the bank disclosed it had incorrectly reported data used in its calculations. The bank withdrew its previously planned increase in April after it found errors that reduced a key capital level by $4 billion.
Bank of America said it would increase its quarterly dividend to 5 cents per share from 1 cent per share, its first dividend hike in seven years.
Bank of America's shares rose as much as 2 percent to $15.30 in early trading on Wednesday. Up to Tuesday's close, the stock had fallen about 2.5 percent this year. (Click here for the latest quote.)