BANK OF AMERICA

Investor Relations

Bank of America Operating Earnings Per Share Rise 35% to $1.23 In The Fourth Quarter; 1999 Operating Earnings Per Share up 29% to $4.68

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Fourth Quarter 1999 Financial Information for Investors

CHARLOTTE, N.C., Jan. 18 /PRNewswire/ -- Bank of America Corporation (NYSE: BAC) today reported that operating earnings per share increased 35 percent in the fourth quarter of 1999 to $1.23 (diluted) from $.91 a year earlier. Operating net income rose 32 percent to $2.12 billion from $1.60 billion.

As previously disclosed, the company recorded a $213 million after-tax charge to cover costs associated with the merger of NationsBank and BankAmerica in the latest quarter compared to a $441 million after-tax charge a year earlier. As a result, net income for the fourth quarter of 1999 was $1.90 billion, or $1.10 per share, compared to $1.16 billion, or $.66 per share, a year earlier. Bank of America earned $2.15 billion, or $1.23 per share in the third quarter of 1999.

For all of 1999, Bank of America's operating earnings rose 27 percent to $8.24 billion from $6.49 billion while operating earnings per share increased 29 percent to $4.68 from $3.64. Including merger-related charges, net income in 1999 was up 53 percent to $7.88 billion, or $4.48 per share, compared to $5.17 billion, or $2.90 per share, a year earlier.

"1999 was a significant step in the right direction," said Hugh L. McColl, Jr., Bank of America chairman and chief executive officer. "We delivered above-average earnings growth and either met or made progress toward our other financial targets. Our merger transition effort could not have gone more smoothly. We ended the year having consolidated all of our business lines, expanded our investment banking platform, and made substantial progress in our relationship-based strategies. Bank of America is now positioned to work to achieve our next goal, which is to become the most widely recognized and respected financial services brand."

Fourth Quarter Earnings (compared to a year ago)

Revenue rose 11 percent, paced by significant improvements in every fee-based business, especially investment banking, trading, mortgage banking and card income. Meanwhile, expenses and provision expense were lower. The completion of annual tax planning strategies resulted in a lower effective tax rate. Operating earnings represented an 18 percent return on common equity.

Net Interest Income

Taxable-equivalent net interest income decreased 2 percent from a year earlier to $4.54 billion. Average managed loans and leases grew an annualized 8 percent, led by increases of more than 30 percent in residential real estate lending. Contributing to the reduction in net interest income were the cost of funding share repurchases and the decisions during the year to sell or securitize loans. Securitizations have the effect of transferring interest revenue to noninterest income. The net yield on earning assets declined 26 basis points to 3.32 percent, reflecting continued margin compression and higher levels of lower-yielding assets.

Noninterest Income

Noninterest income grew 35 percent to $3.60 billion. Investment banking and trading income were up sharply, in part due to the impact of market turbulence in the previous year as well as the build out of investment banking capabilities. Mortgage servicing income, card services fees and service charges on deposit accounts also had healthy gains. Other income was also up. Noninterest income has been increasing as a percentage of the company's revenues and reached 44 percent in the fourth quarter.

Securities gains were $14 million, compared to $404 million a year earlier.

Efficiency

Noninterest expense decreased 3 percent to $4.55 billion, reflecting cost reductions resulting from recent mergers, somewhat offset by continued spending on technology-related projects associated with the merger of NationsBank and BankAmerica and higher incentive payments associated with the build out of the investment banking platform. The efficiency ratio was 56 percent, an improvement of 825 basis points.

Credit Quality

Nonperforming assets were $3.20 billion, or .86 percent of loans, leases and foreclosed properties on December 31, 1999, compared to $2.76 billion, or .77 percent, a year earlier. The allowance for credit losses totaled $6.8 billion on December 31, 1999, equal to 224 percent of nonperforming loans and 1.84 percent of loans and leases. It was $7.1 billion, or 1.99 percent of loans and leases, a year earlier.

The provision for credit losses in the fourth quarter was $350 million compared to $510 million a year earlier. Net charge-offs declined to $501 million, equal to an annualized .55 percent of average loans and leases, from $544 million, or .60 percent, a year earlier.

The lower provision expense reflects the significant reduction in the risk and size of the company's emerging markets portfolio since September 1998. In addition, foreign losses in 1999 were lower than expected, as several Latin American and Asian economies have stabilized or progressed and their prospects improved. The company's credit outlook for 2000 remains favorable, driven by the expectation of continued healthy economic conditions and growth in loans with historically lower credit risk.

Full-Year Earnings

Results for the year also reflected favorable operating leverage created by a 6 percent increase in revenue combined with a 4 percent reduction in expenses and a lower tax rate. The return on equity rose more than 300 basis points to 18 percent.

Taxable-equivalent net interest income was virtually unchanged at $18.5 billion, as a 9 percent increase in average managed loans and core deposit growth was offset by securitizations, loan sales and spread compression. The net yield on earning assets declined 22 basis points to 3.47 percent.

Noninterest income rose 15 percent, paced by strong increases in trading, deposit services, investment banking, mortgage banking and card income.

Noninterest expense declined 4 percent to $18.0 billion, reflecting cost savings from recent mergers. The efficiency ratio for the year was 55 percent compared to 61 percent last year.

The provision for credit losses was $1.82 billion, down from $2.92 billion a year earlier. Net charge-offs declined to $2.00 billion, equal to .55 percent of average net loans and leases, from $2.47 billion, or .71 percent, a year earlier.

Capital Strength

Total shareholders' equity was $44.4 billion at December 31, 1999. This represented 7.02 percent of period-end assets, compared to 7.44 percent on December 31, 1998.

In June, the company initiated a share buyback program of up to 130 million shares. Through December, 78 million shares had been purchased, representing an investment in Bank of America stock of almost $5 billion.

Business Segment Results

Consumer Banking, which serves individuals and small businesses, earned $3.9 billion for all of 1999 while Commercial Banking, which serves companies with from $10 million to $500 million in revenue, earned $878 million. Together, they represented 58 percent of the company's operating income. Global Corporate and Investment Banking, which serves large corporate customers, earned $2.3 billion, representing 27 percent of the company's earnings. Principal Investing and Asset Management, which encompasses the private bank, trust, investment management, mutual funds, retail brokerage and principal investing, earned $841 million, representing 10 percent.

Bank of America, with $633 billion in assets, is the largest bank in the United States. The company serves more than 30 million households and 2 million businesses across the country, offering customers the largest and most convenient delivery network from offices and ATMs to telephone and internet access. It also provides comprehensive international corporate financial services for clients doing business around the world. The company creates financial relationships featuring a wide array of financial services, from traditional banking products to investments and capital raising within the securities markets. Bank of America stock (ticker: BAC) is listed on the New York, Pacific and London stock exchanges and certain shares are listed on the Tokyo Stock Exchange. Further investor information can be found at www.bankofamerica.com/investor .

www.bankofamerica.com

Bank of America Corporation

                                          Three Months          TWELVE Months
                                       Ended DECEMBER 31     Ended DECEMBER 31
                                         1999      1998       1999      1998
    Financial Summary
    (In millions, except per-share data)

    Operating net income              $2,115      $1,603     $8,240     $6,490
     Operating earnings
      per common share                  1.24         .92       4.77       3.73
     Diluted operating earnings
      per common share                  1.23         .91       4.68       3.64
    Cash basis earnings (A)            2,334       1,825      9,128      7,391
     Cash basis earnings per
      common share                      1.37        1.05       5.28       4.25
     Cash basis diluted earnings
      per common share                  1.35        1.04       5.19       4.15
    Dividends paid per common share      .50         .45       1.85       1.59
    Price per share of common stock
      at period end                    50.19       60.13      50.19      60.13
    Average common shares          1,701.092   1,731.314  1,726.006  1,732.057
    Average diluted common shares  1,725.187   1,763.055  1,760.058  1,775.760

    Summary Income Statement (Operating Basis)
    (Taxable-equivalent basis in millions)

    Net interest income               $4,541      $4,650    $18,452    $18,461
    Provision for credit losses        (350)       (510)    (1,820)    (2,920)
    Gains on sales of securities         14         404        240      1,017
    Noninterest income                3,596       2,655     14,069     12,189
    Other noninterest expense        (4,550)     (4,687)   (17,986)   (18,741)

    Income before income taxes        3,251       2,512      12,955    10,006
    Income taxes - including
     FTE adjustment                   1,136         909      4,715      3,516
    Operating net income             $2,115      $1,603     $8,240     $6,490


    SUMMARY Balance Sheet
    (Average balances in billions)

    Loans and leases                $364.210    $357.636   $362.783   $347.840
    Managed loans and leases(B)      393.708     365.297    388.918    356.802
    Securities                        86.442      72.302     80.127     66.684
    Earning assets                   543.564     517.066    531.511    499.739
    Total assets                     630.743     606.541    616.838    584.487
    Deposits                         341.913     351.766    341.748    345.485
    Shareholders' equity              46.792      45.051     46.601     44.829
    Common shareholders' equity       46.714      44.989     46.527     44.467


    PERFORMANCE INDICES (Operating Basis)

    Return on average common
     shareholders' equity             17.95%      14.12%      17.70%    14.54%
    Return on average tangible
     common shareholders' equity      28.38       23.97       28.46     25.24
    Return on average assets           1.33        1.05        1.34      1.11
    Return on average tangible
     assets                            1.50        1.22        1.52      1.30
    Net interest yield                 3.32        3.58        3.47      3.69
    Efficiency ratio                  55.91       64.16       55.30     61.15
    Cash basis efficiency ratio       53.22       61.12       52.57     58.20
    Net charge-offs (in millions)      $501        $544      $2,000    $2,467
     % of average loans and leases      .55%        .60%        .55%      .71%
    Managed bankcard net charge-offs
     as a % of average managed
     bankcard receivables              5.29        5.83       5.57      6.27

    REPORTED RESULTS (Including Merger-Related Charges)
    (In millions, except per-share data)

    Net income                       $1,902      $1,162      $7,882    $5,165
     Earnings per common share         1.12         .67        4.56      2.97
     Diluted earnings
      per common share                 1.10         .66        4.48      2.90
    Return on average common
     shareholders' equity             16.14       10.23       16.93     11.56

    (A) Cash basis earnings equal operating net income excluding
        amortization of intangibles.
    (B) Prior periods are restated for comparison (e.g. acquisitions,
        divestitures and securitizations).

                                                           DECEMBER 31
                                                        1999        1998
    Balance Sheet highlights
    (In billions, except per-share data)

    Loans and leases                                  $370.662    $357.328
    Securities                                          83.069      80.587
    Earning assets                                     544.940     525.149
    Total assets                                       632.574     617.679
    Deposits                                           347.273     357.260
    Shareholders' equity                                44.432      45.938
    Common shareholders' equity                         44.355      45.866
     Per share                                           26.44       26.60

    Total equity to assets ratio
     (period-end)                                         7.02%       7.44%

    Risk-based capital
     Tier 1 capital ratio                                 7.35        7.06
     Total capital ratio                                 10.88       10.94

    Leverage ratio                                        6.26        6.22

    Common shares issued and
     outstanding (in millions)                       1,677.273   1,724.484

    Allowance for credit losses                         $6.828      $7.122
    Allowance for credit losses
     as a % of loans and leases                           1.84%       1.99%
    Allowance for credit losses
     as a % of nonperforming loans                      224.48      287.01
    Nonperforming loans                                 $3.042      $2.482
    Nonperforming assets                                 3.205       2.764
    Nonperforming assets as a % of:
     Total assets                                          .51%        .45%
     Loans, leases and foreclosed properties               .86         .77

    OTHER DATA

    Full-time equivalent headcount                     155,906     170,975
    Banking centers                                      4,524       4,708
    ATMs                                                14,019      14,327


    BUSINESS SEGMENT RESULTS - Three months ended December 31, 1999
    (In millions)


                                       OPERATING     AVERAGE      RETURN ON
                            TOTAL         NET         LOANS        AVERAGE
                           REVENUE       INCOME     AND LEASES      EQUITY

    Consumer Banking       $4,551          $951     $183,244          19%
    Commercial Banking        813           256       56,912          24
    Global Corporate and
      Investment Banking    1,975           630      103,999          19
    Principal Investing
     and Asset Management     704           214       20,165          26

SOURCE Bank of America Corporation

CONTACT: investors, Susan Carr, 704-386-8059, or Kevin Stitt, 704-386-5667, or media, Bob Stickler or Sharon Tucker, 704-386-8465, all of Bank of America Corporation/