Exhibit 99.2
Supplemental Information
Third Quarter 2003
October 14, 2003
This information is preliminary and based on company data available at the time of the presentation. It speaks only as of the particular date or dates included in the accompanying pages. Bank of America does not undertake an obligation to, and disclaims any duty to, correct or update any of the information provided. Any forward-looking statements in this information are subject to the forward-looking language contained in Bank of America's reports filed with the SEC pursuant to the Securities Exchange Act of 1934, which are available at the SEC's website (www.sec.gov) or at Bank of America's website (www.bankofamerica.com). Bank of America's future financial performance is subject to risks and uncertainties as described in its SEC filings.
Bank of America Corporation
Results Overview
| l | Record earnings of $2.9 billion. |
| l | Diluted EPS of $1.92, up 7% and 32% over 2Q03 and 3Q02, respectively. |
| l | Total revenue rose 1% over 2Q03 and 14% over 3Q02. |
| l | Consumer and Commercial Banking segment noninterest revenue rose 13% over 2Q03 and 36% over 3Q02 led by record quarters in card services and consumer real estate. |
| l | Consumer loans grew 17% while core deposit levels rose 13% over 3Q02. |
| l | Achieved full year goal of 1 million net new checking accounts 3 months early by adding approximately 425,000 new accounts in the 3rd quarter, clearly surpassing the 528,000 accounts added in 2002. |
| l | Customer satisfaction for Top 2 box scores of most delighted customers continues at record highs. |
| l | Banking center product sales increased 28% in the past year. |
| l | Active online banking users increased 52% over 3Q02 to 6.6 million. |
| l | Marsico Funds grew assets under management 94% from 3Q02 leading the 18% growth in total assets under management. |
| l | Global Corporate and Investment Banking grew earnings 16% over 2Q03 as strong revenues were combined with good cost containment and lower provision. |
| l | Nonperforming assets declined 17% from 2Q03; lowest level in three years. |
| l | Net charge-off ratio declined to .86% of average loans compared to 2Q03. |
| l | The quarterly dividend payment made in September reflected a 25% increase to $0.80 per common share. |
1
Bank of America Corporation
Consolidated Financial Highlights
(Dollars in millions, except per share information; shares in thousands)
| Year-to- Date 2003 |
Year-to- Date 2002 |
Third Quarter 2003 |
Second Quarter 2003 |
First Quarter 2003 |
Fourth Quarter 2002 |
Third Quarter 2002 |
||||||||||||||||||||||
| Income statement |
||||||||||||||||||||||||||||
| Total revenue |
$ | 28,257 | $ | 25,690 | $ | 9,743 | $ | 9,620 | $ | 8,894 | $ | 8,804 | $ | 8,522 | ||||||||||||||
| Provision for credit losses |
2,256 | 2,532 | 651 | 772 | 833 | 1,165 | 804 | |||||||||||||||||||||
| Gains on sales of securities |
802 | 326 | 233 | 296 | 273 | 304 | 189 | |||||||||||||||||||||
| Noninterest expense |
14,845 | 13,604 | 5,070 | 5,058 | 4,717 | 4,832 | 4,620 | |||||||||||||||||||||
| Income tax expense |
3,874 | 3,245 | 1,333 | 1,348 | 1,193 | 497 | 1,052 | |||||||||||||||||||||
| Net income |
8,084 | 6,635 | 2,922 | 2,738 | 2,424 | 2,614 | 2,235 | |||||||||||||||||||||
| Diluted earnings per common share |
5.31 | 4.22 | 1.92 | 1.80 | 1.59 | 1.69 | 1.45 | |||||||||||||||||||||
| Average diluted common shares outstanding |
1,523,523 | 1,573,203 | 1,519,641 | 1,523,306 | 1,526,288 | 1,542,482 | 1,546,347 | |||||||||||||||||||||
| Dividends paid per common share |
$ | 2.08 | $ | 1.80 | $ | 0.80 | $ | 0.64 | $ | 0.64 | $ | 0.64 | $ | 0.60 | ||||||||||||||
| Performance ratios |
||||||||||||||||||||||||||||
| Return on average assets |
1.43 | % | 1.36 | % | 1.48 | % | 1.42 | % | 1.38 | % | 1.49 | % | 1.33 | % | ||||||||||||||
| Return on average common shareholders’ equity |
21.85 | 18.71 | 23.74 | 21.86 | 19.92 | 21.58 | 19.02 | |||||||||||||||||||||
| Book value per share of common stock |
$ | 33.83 | $ | 32.07 | $ | 33.83 | $ | 34.06 | $ | 33.38 | $ | 33.49 | $ | 32.07 | ||||||||||||||
| Market price per share of common stock: |
||||||||||||||||||||||||||||
| High for the period |
$ | 84.90 | $ | 77.08 | $ | 84.90 | $ | 80.00 | $ | 72.50 | $ | 71.99 | $ | 71.94 | ||||||||||||||
| Low for the period |
64.26 | 57.51 | 74.58 | 67.20 | 64.26 | 53.98 | 57.90 | |||||||||||||||||||||
| Closing price |
78.04 | 63.80 | 78.04 | 79.03 | 66.84 | 69.57 | 63.80 | |||||||||||||||||||||
| Market capitalization |
116,236 | 95,838 | 116,236 | 118,254 | 100,095 | 104,403 | 95,838 | |||||||||||||||||||||
| Number of banking centers |
4,211 | 4,226 | 4,211 | 4,200 | 4,202 | 4,208 | 4,226 | |||||||||||||||||||||
| Number of ATM’s |
13,120 | 12,489 | 13,120 | 13,250 | 13,266 | 13,013 | 12,489 | |||||||||||||||||||||
| Full-time equivalent employees |
132,749 | 134,135 | 132,749 | 132,796 | 132,583 | 133,944 | 134,135 | |||||||||||||||||||||
Certain prior period amounts have been reclassified to conform to current period presentation.
2
Bank of America Corporation
Supplemental Financial Data
(Dollars in millions)
Fully taxable-equivalent basis data
| Year-to- Date 2003 |
Year-to- Date 2002 |
Third Quarter 2003 |
Second Quarter 2003 |
First Quarter 2003 |
Fourth Quarter 2002 |
Third Quarter 2002 |
||||||||||||||||||||||
| Net interest income |
$ | 16,362 | $ | 15,974 | $ | 5,477 | $ | 5,524 | $ | 5,361 | $ | 5,537 | $ | 5,465 | ||||||||||||||
| Total revenue |
28,741 | 26,115 | 9,916 | 9,779 | 9,046 | 8,967 | 8,685 | |||||||||||||||||||||
| Net interest yield |
3.35 | % | 3.78 | % | 3.22 | % | 3.33 | % | 3.52 | % | 3.66 | % | 3.75 | % | ||||||||||||||
| Efficiency ratio |
51.65 | 52.09 | 51.13 | 51.73 | 52.14 | 53.90 | 53.19 | |||||||||||||||||||||
Reconciliation to GAAP financial measures
Shareholder value added (SVA) is a performance measure used in managing the corporation's growth strategy and is not defined in GAAP (generally accepted accounting principles). Management believes that this measure provides users of this financial information with a more accurate picture of returns on capital used in operating the business for comparative purposes. Other companies may define or calculate supplemental financial data differently. See the Table below for supplemental financial data and corresponding reconciliation to GAAP financial measures for the nine months ended September 30, 2003 and 2002, and the three months ended September 30, 2003, June 30, 2003, March 31, 2003, December 31, 2002, and September 30, 2002.
Reconciliation of net income to
shareholder value added
| Year-to- Date 2003 |
Year-to- Date 2002 |
Third Quarter 2003 |
Second Quarter 2003 |
First Quarter 2003 |
Fourth Quarter 2002 |
Third Quarter 2002 |
||||||||||||||||||||||
| Net income |
$ | 8,084 | $ | 6,635 | $ | 2,922 | $ | 2,738 | $ | 2,424 | $ | 2,614 | $ | 2,235 | ||||||||||||||
| Amortization expense |
163 | 164 | 55 | 54 | 54 | 54 | 54 | |||||||||||||||||||||
| Capital charge |
(4,069 | ) | (4,253 | ) | (1,353 | ) | (1,378 | ) | (1,338 | ) | (1,454 | ) | (1,409 | ) | ||||||||||||||
| Shareholder value added |
$ | 4,178 | $ | 2,546 | $ | 1,624 | $ | 1,414 | $ | 1,140 | $ | 1,214 | $ | 880 | ||||||||||||||
Certain prior period amounts have been reclassified to conform to current period presentation.
3
Bank of America Corporation
Consolidated Statement of Income
(Dollars in millions, except per share information; shares in thousands)
| Year-to- Date 2003 |
Year-to- Date 2002 |
Third Quarter 2003 |
Second Quarter 2003 |
First Quarter 2003 |
Fourth Quarter 2002 |
Third Quarter 2002 |
|||||||||||||||||||
| Interest income |
|||||||||||||||||||||||||
| Interest and fees on loans and leases |
$ | 16,088 | $ | 16,528 | $ | 5,328 | $ | 5,412 | $ | 5,348 | $ | 5,502 | $ | 5,553 | |||||||||||
| Interest and dividends on securities |
2,412 | 2,974 | 623 | 1,011 | 778 | 1,061 | 1,104 | ||||||||||||||||||
| Federal funds sold and securities purchased under agreements to resell |
867 | 662 | 480 | 193 | 194 | 208 | 177 | ||||||||||||||||||
| Trading account assets |
3,024 | 2,832 | 975 | 1,007 | 1,042 | 979 | 1,006 | ||||||||||||||||||
| Other interest income |
1,184 | 1,044 | 449 | 372 | 363 | 371 | 345 | ||||||||||||||||||
| Total interest income |
23,575 | 24,040 | 7,855 | 7,995 | 7,725 | 8,121 | 8,185 | ||||||||||||||||||
| Interest expense |
|||||||||||||||||||||||||
| Deposits |
3,730 | 4,142 | 1,278 | 1,269 | 1,183 | 1,292 | 1,414 | ||||||||||||||||||
| Short-term borrowings |
1,414 | 1,532 | 447 | 514 | 453 | 557 | 526 | ||||||||||||||||||
| Trading account liabilities |
969 | 971 | 345 | 316 | 308 | 289 | 342 | ||||||||||||||||||
| Long-term debt |
1,584 | 1,846 | 481 | 531 | 572 | 609 | 601 | ||||||||||||||||||
| Total interest expense |
7,697 | 8,491 | 2,551 | 2,630 | 2,516 | 2,747 | 2,883 | ||||||||||||||||||
| Net interest income |
15,878 | 15,549 | 5,304 | 5,365 | 5,209 | 5,374 | 5,302 | ||||||||||||||||||
| Noninterest income |
|||||||||||||||||||||||||
| Consumer service charges |
2,394 | 2,185 | 824 | 793 | 777 | 801 | 762 | ||||||||||||||||||
| Corporate service charges |
1,788 | 1,718 | 634 | 577 | 577 | 572 | 585 | ||||||||||||||||||
| Total service charges |
4,182 | 3,903 | 1,458 | 1,370 | 1,354 | 1,373 | 1,347 | ||||||||||||||||||
| Consumer investment and brokerage services |
1,146 | 1,175 | 367 | 401 | 378 | 369 | 374 | ||||||||||||||||||
| Corporate investment and brokerage services |
591 | 521 | 222 | 204 | 165 | 172 | 173 | ||||||||||||||||||
| Total investment and brokerage services |
1,737 | 1,696 | 589 | 605 | 543 | 541 | 547 | ||||||||||||||||||
| Mortgage banking income |
1,630 | 551 | 666 | 559 | 405 | 210 | 220 | ||||||||||||||||||
| Investment banking income |
1,278 | 1,123 | 412 | 488 | 378 | 422 | 318 | ||||||||||||||||||
| Equity investment gains (losses) |
0 | (226 | ) | 25 | 43 | (68 | ) | (54 | ) | (216 | ) | ||||||||||||||
| Card income |
2,237 | 1,885 | 794 | 762 | 681 | 735 | 687 | ||||||||||||||||||
| Trading account profits |
382 | 679 | 175 | 93 | 114 | 99 | 71 | ||||||||||||||||||
| Other income |
933 | 530 | 320 | 335 | 278 | 104 | 246 | ||||||||||||||||||
| Total noninterest income |
12,379 | 10,141 | 4,439 | 4,255 | 3,685 | 3,430 | 3,220 | ||||||||||||||||||
| Total revenue |
28,257 | 25,690 | 9,743 | 9,620 | 8,894 | 8,804 | 8,522 | ||||||||||||||||||
| Provision for credit losses |
2,256 | 2,532 | 651 | 772 | 833 | 1,165 | 804 | ||||||||||||||||||
| Gains on sales of securities |
802 | 326 | 233 | 296 | 273 | 304 | 189 | ||||||||||||||||||
| Noninterest expense |
|||||||||||||||||||||||||
| Personnel |
7,749 | 7,200 | 2,595 | 2,695 | 2,459 | 2,482 | 2,368 | ||||||||||||||||||
| Occupancy |
1,492 | 1,330 | 522 | 498 | 472 | 450 | 457 | ||||||||||||||||||
| Equipment |
789 | 832 | 252 | 253 | 284 | 292 | 291 | ||||||||||||||||||
| Marketing |
717 | 550 | 249 | 238 | 230 | 203 | 210 | ||||||||||||||||||
| Professional fees |
620 | 339 | 214 | 281 | 125 | 186 | 126 | ||||||||||||||||||
| Amortization of intangibles |
163 | 164 | 55 | 54 | 54 | 54 | 54 | ||||||||||||||||||
| Data processing |
803 | 726 | 275 | 262 | 266 | 291 | 295 | ||||||||||||||||||
| Telecommunications |
413 | 361 | 152 | 137 | 124 | 120 | 119 | ||||||||||||||||||
| Other general operating |
2,099 | 2,102 | 756 | 640 | 703 | 754 | 700 | ||||||||||||||||||
| Total noninterest expense |
14,845 | 13,604 | 5,070 | 5,058 | 4,717 | 4,832 | 4,620 | ||||||||||||||||||
| Income before income taxes |
11,958 | 9,880 | 4,255 | 4,086 | 3,617 | 3,111 | 3,287 | ||||||||||||||||||
| Income tax expense |
3,874 | 3,245 | 1,333 | 1,348 | 1,193 | 497 | 1,052 | ||||||||||||||||||
| Net income |
$ | 8,084 | $ | 6,635 | $ | 2,922 | $ | 2,738 | $ | 2,424 | $ | 2,614 | $ | 2,235 | |||||||||||
| Net income available to common shareholders |
$ | 8,081 | $ | 6,631 | $ | 2,921 | $ | 2,737 | $ | 2,423 | $ | 2,613 | $ | 2,233 | |||||||||||
| Per common share information |
|||||||||||||||||||||||||
| Earnings |
$ | 5.41 | $ | 4.34 | $ | 1.96 | $ | 1.83 | $ | 1.62 | $ | 1.74 | $ | 1.49 | |||||||||||
| Diluted earnings |
$ | 5.31 | $ | 4.22 | $ | 1.92 | $ | 1.80 | $ | 1.59 | $ | 1.69 | $ | 1.45 | |||||||||||
| Dividends paid |
$ | 2.08 | $ | 1.80 | $ | 0.80 | $ | 0.64 | $ | 0.64 | $ | 0.64 | $ | 0.60 | |||||||||||
| Average common shares issued and outstanding |
1,494,369 | 1,526,946 | 1,490,103 | 1,494,094 | 1,499,405 | 1,499,557 | 1,504,017 | ||||||||||||||||||
| Average diluted common shares issued and outstanding |
1,523,523 | 1,573,203 | 1,519,641 | 1,523,306 | 1,526,288 | 1,542,482 | 1,546,347 | ||||||||||||||||||
Certain prior period amounts have been reclassified to conform to current period presentation.
4
Bank of America Corporation
Consolidated Balance Sheet
(Dollars in millions)
| September 30 2003 |
June 30 2003 |
September 30 2002 |
||||||||||
| Assets |
||||||||||||
| Cash and cash equivalents |
$ | 22,142 | $ | 25,220 | $ | 24,469 | ||||||
| Time deposits placed and other short-term investments |
6,881 | 6,790 | 6,397 | |||||||||
| Federal funds sold and securities purchased under agreements to resell |
67,729 | 64,314 | 40,371 | |||||||||
| Trading account assets |
65,339 | 66,947 | 56,907 | |||||||||
| Derivative assets |
36,810 | 38,587 | 32,838 | |||||||||
| Securities: |
||||||||||||
| Available-for-sale |
64,363 | 114,250 | 88,571 | |||||||||
| Held-to-maturity |
522 | 279 | 1,010 | |||||||||
| Total securities |
64,885 | 114,529 | 89,581 | |||||||||
| Loans and leases |
373,098 | 360,305 | 341,091 | |||||||||
| Allowance for credit losses |
(6,716 | ) | (6,841 | ) | (6,861 | ) | ||||||
| Loans and leases, net of allowance for credit losses |
366,382 | 353,464 | 334,230 | |||||||||
| Premises and equipment, net |
5,956 | 5,899 | 6,758 | |||||||||
| Mortgage banking assets |
2,426 | 1,748 | 2,129 | |||||||||
| Goodwill |
11,456 | 11,426 | 11,389 | |||||||||
| Core deposit intangibles and other intangibles |
966 | 1,010 | 1,127 | |||||||||
| Other assets |
86,116 | (1) | 79,245 | 53,812 | ||||||||
| Total assets |
$ | 737,088 | $ | 769,179 | $ | 660,008 | ||||||
| Liabilities |
||||||||||||
| Deposits in domestic offices: |
||||||||||||
| Noninterest-bearing |
$ | 122,669 | $ | 132,851 | $ | 116,847 | ||||||
| Interest-bearing |
257,586 | 256,602 | 228,174 | |||||||||
| Deposits in foreign offices: |
||||||||||||
| Noninterest-bearing |
2,650 | 2,206 | 1,928 | |||||||||
| Interest-bearing |
25,605 | 30,276 | 30,466 | |||||||||
| Total deposits |
408,510 | 421,935 | 377,415 | |||||||||
| Federal funds purchased and securities sold under agreements to repurchase |
79,775 | 104,821 | 61,823 | |||||||||
| Trading account liabilities |
29,744 | 27,708 | 26,031 | |||||||||
| Derivative liabilities |
25,120 | 23,435 | 23,701 | |||||||||
| Commercial paper and other short-term borrowings |
41,739 | (1) | 43,584 | 34,421 | ||||||||
| Accrued expenses and other liabilities |
35,293 | 28,943 | 22,393 | |||||||||
| Long-term debt |
66,462 | (2) | 61,681 | 59,954 | ||||||||
| Trust preferred securities |
— | (2) | 6,056 | 6,031 | ||||||||
| Total liabilities |
686,643 | 718,163 | 611,769 | |||||||||
| Shareholders’ equity |
||||||||||||
| Preferred stock, $0.01 par value; authorized—100,000,000 shares; issued and outstanding 1,281,600; 1,306,463 and 1,391,749 shares |
55 | 56 | 60 | |||||||||
| Common stock, $0.01 par value; authorized—5,000,000,000 shares; issued and outstanding 1,489,437,206; 1,496,314,280 and 1,502,161,891 shares |
15 | 15 | 674 | |||||||||
| Retained earnings |
52,320 | 51,374 | 46,870 | |||||||||
| Accumulated other comprehensive income (loss) |
(1,776 | ) | (251 | ) | 613 | |||||||
| Other |
(169 | ) | (178 | ) | 22 | |||||||
| Total shareholders’ equity |
50,445 | 51,016 | 48,239 | |||||||||
| Total liabilities and shareholders’ equity |
$ | 737,088 | $ | 769,179 | $ | 660,008 | ||||||
| (1) | In accordance with FIN 46, the corporation consolidated $12.2 billion of asset-backed commercial paper conduits beginning July 1, 2003. |
| (2) | Includes $6,244 of long-term debt related to trust preferred securities in accordance with FIN 46. |
5
Bank of America Corporation
Capital Management
(Dollars in millions)
| 3Q02 |
4Q02 |
1Q03 |
2Q03 |
3Q03* |
||||||||||||||||
| Tier 1 capital |
$ | 41,732 | $ | 43,105 | $ | 43,818 | $ | 45,192 | $ | 46,094 | ||||||||||
| Total capital |
63,505 | 65,169 | 65,688 | 66,843 | 67,991 | |||||||||||||||
| Risk-weighted assets |
513,085 | 524,175 | 534,378 | 559,324 | 558,472 | |||||||||||||||
| Tier 1 capital ratio |
8.13 | % | 8.22 | % | 8.20 | % | 8.08 | % | 8.25 | % | ||||||||||
| Total capital ratio |
12.38 | 12.43 | 12.29 | 11.95 | 12.17 | |||||||||||||||
| Ending equity / ending assets |
7.31 | 7.62 | 7.36 | 6.63 | 6.84 | |||||||||||||||
| Ending capital / ending assets |
8.22 | 8.53 | 8.25 | 7.42 | 7.69 | |||||||||||||||
| Average equity / average assets |
6.97 | 6.91 | 6.92 | 6.49 | 6.22 | |||||||||||||||
*Preliminary data on risk based capital
Share Repurchase Program
25 million common shares were repurchased in the third quarter of 2003 as a part of ongoing share repurchase programs.
80 million shares remain outstanding under the current authorized program.
18 million shares were issued in the third quarter of 2003, mostly due to stock incentive plans.
.
6
Bank of America Corporation
Quarterly Average Balances and Interest Rates—Fully Taxable-Equivalent Basis
(Dollars in millions)
| Third Quarter 2003 |
Second Quarter 2003 |
Third Quarter 2002 |
|||||||||||||||||||||||||
| Average Balance |
Interest Income/ Expense |
Yield/ Rate |
Average Balance |
Interest Income/ Expense |
Yield/ Rate |
Average Balance |
Interest Income/ Expense |
Yield/ Rate |
|||||||||||||||||||
| Earning assets |
|||||||||||||||||||||||||||
| Time deposits placed and other short-term investments |
$ | 10,062 | $ | 41 | 1.63 | % | $ | 7,888 | $ | 39 | 1.99 | % | $ | 10,396 | $ | 63 | 2.41 | % | |||||||||
| Federal funds sold and securities purchased under agreements to resell |
90,236 | 479 | 2.11 | 70,054 | 194 | 1.11 | 40,294 | 178 | 1.76 | ||||||||||||||||||
| Trading account assets |
96,105 | 991 | 4.11 | 99,129 | 1,022 | 4.13 | 85,129 | 1,017 | 4.76 | ||||||||||||||||||
| Securities |
65,024 | 639 | 3.93 | 95,614 | 1,028 | 4.30 | 76,484 | 1,120 | 5.85 | ||||||||||||||||||
| Loans and leases(1): |
|||||||||||||||||||||||||||
| Commercial—domestic |
96,086 | 1,719 | 7.10 | 100,721 | 1,746 | 6.95 | 106,039 | 1,728 | 6.47 | ||||||||||||||||||
| Commercial—foreign |
16,885 | 151 | 3.55 | 18,004 | 170 | 3.79 | 21,256 | 206 | 3.85 | ||||||||||||||||||
| Commercial real estate—domestic |
19,681 | 210 | 4.23 | 20,039 | 218 | 4.36 | 20,576 | 265 | 5.10 | ||||||||||||||||||
| Commercial real estate—foreign |
280 | 3 | 4.16 | 305 | 3 | 3.95 | 425 | 4 | 3.92 | ||||||||||||||||||
| Total commercial |
132,932 | 2,083 | 6.22 | 139,069 | 2,137 | 6.16 | 148,296 | 2,203 | 5.90 | ||||||||||||||||||
| Residential mortgage |
130,948 | 1,656 | 5.05 | 120,754 | 1,703 | 5.64 | 104,590 | 1,733 | 6.61 | ||||||||||||||||||
| Home equity lines |
22,539 | 255 | 4.48 | 22,763 | 263 | 4.64 | 23,275 | 314 | 5.35 | ||||||||||||||||||
| Direct/Indirect consumer |
33,278 | 488 | 5.82 | 32,248 | 495 | 6.17 | 30,029 | 530 | 7.01 | ||||||||||||||||||
| Consumer finance |
6,528 | 121 | 7.39 | 7,244 | 137 | 7.58 | 10,043 | 201 | 7.97 | ||||||||||||||||||
| Credit card |
29,113 | 742 | 10.11 | 26,211 | 690 | 10.56 | 22,263 | 583 | 10.38 | ||||||||||||||||||
| Foreign consumer |
1,950 | 17 | 3.43 | 1,990 | 17 | 3.47 | 1,988 | 19 | 3.83 | ||||||||||||||||||
| Total consumer |
224,356 | 3,279 | 5.82 | 211,210 | 3,305 | 6.27 | 192,188 | 3,380 | 7.00 | ||||||||||||||||||
| Total loans and leases |
357,288 | 5,362 | 5.97 | 350,279 | 5,442 | 6.23 | 340,484 | 5,583 | 6.52 | ||||||||||||||||||
| Other earning assets |
58,593 | 516 | 3.50 | 40,536 | 429 | 4.24 | 27,461 | 387 | 5.61 | ||||||||||||||||||
| Total earning assets(2) |
677,308 | 8,028 | 4.72 | 663,500 | 8,154 | 4.92 | 580,248 | 8,348 | 5.73 | ||||||||||||||||||
| Cash and cash equivalents |
22,660 | 23,203 | 20,202 | ||||||||||||||||||||||||
| Other assets, less allowance for credit losses |
85,713 | 87,941 | 68,699 | ||||||||||||||||||||||||
| Total assets |
$ | 785,681 | $ | 774,644 | $ | 669,149 | |||||||||||||||||||||
| Interest-bearing liabilities |
|||||||||||||||||||||||||||
| Domestic interest-bearing deposits: |
|||||||||||||||||||||||||||
| Savings |
$ | 25,285 | $ | 20 | 0.31 | % | $ | 24,420 | $ | 35 | 0.58 | % | $ | 22,047 | $ | 36 | 0.64 | % | |||||||||
| NOW and money market deposit accounts |
151,424 | 249 | 0.65 | 146,284 | 295 | 0.81 | 132,939 | 362 | 1.08 | ||||||||||||||||||
| Consumer CDs and IRAs |
71,216 | 872 | 4.85 | 69,506 | 742 | 4.28 | 67,179 | 746 | 4.40 | ||||||||||||||||||
| Negotiable CDs, public funds and other time deposits |
7,771 | 25 | 1.27 | 12,912 | 45 | 1.41 | 4,254 | 51 | 4.73 | ||||||||||||||||||
| Total domestic interest-bearing deposits |
255,696 | 1,166 | 1.81 | 253,122 | 1,117 | 1.77 | 226,419 | 1,195 | 2.09 | ||||||||||||||||||
| Foreign interest-bearing deposits(3): |
|||||||||||||||||||||||||||
| Banks located in foreign countries |
12,273 | 59 | 1.90 | 16,150 | 87 | 2.16 | 17,044 | 123 | 2.85 | ||||||||||||||||||
| Governments and official institutions |
2,032 | 6 | 1.21 | 2,392 | 8 | 1.42 | 2,188 | 10 | 1.85 | ||||||||||||||||||
| Time, savings and other |
18,792 | 47 | 1.00 | 19,209 | 57 | 1.18 | 18,686 | 86 | 1.83 | ||||||||||||||||||
| Total foreign interest-bearing deposits |
33,097 | 112 | 1.35 | 37,751 | 152 | 1.61 | 37,918 | 219 | 2.29 | ||||||||||||||||||
| Total interest-bearing deposits |
288,793 | 1,278 | 1.76 | 290,873 | 1,269 | 1.75 | 264,337 | 1,414 | 2.12 | ||||||||||||||||||
| Federal funds purchased, securities sold under agreements to repurchase and other short-term borrowings |
162,080 | 447 | 1.09 | 152,722 | 514 | 1.35 | 108,281 | 526 | 1.93 | ||||||||||||||||||
| Trading account liabilities |
36,903 | 345 | 3.71 | 38,610 | 316 | 3.28 | 33,038 | 342 | 4.11 | ||||||||||||||||||
| Long-term debt(4) |
66,788 | 481 | 2.88 | 68,927 | 531 | 3.08 | 64,880 | 601 | 3.71 | ||||||||||||||||||
| Total interest-bearing liabilities(2) |
554,564 | 2,551 | 1.83 | 551,132 | 2,630 | 1.91 | 470,536 | 2,883 | 2.44 | ||||||||||||||||||
| Noninterest-bearing sources: |
|||||||||||||||||||||||||||
| Noninterest-bearing deposits |
125,776 | 114,434 | 109,596 | ||||||||||||||||||||||||
| Other liabilities |
56,470 | 58,809 | 42,365 | ||||||||||||||||||||||||
| Shareholders’ equity |
48,871 | 50,269 | 46,652 | ||||||||||||||||||||||||
| Total liabilities and shareholders’ equity |
$ | 785,681 | $ | 774,644 | $ | 669,149 | |||||||||||||||||||||
| Net interest spread |
2.89 | 3.01 | 3.29 | ||||||||||||||||||||||||
| Impact of noninterest-bearing sources |
0.33 | 0.32 | 0.46 | ||||||||||||||||||||||||
| Net interest income/yield on earning assets |
$ | 5,477 | 3.22 | % | $ | 5,524 | 3.33 | % | $ | 5,465 | 3.75 | % | |||||||||||||||
| (1) | Nonperforming loans are included in the respective average loan balances. Income on such nonperforming loans is recognized on a cash basis. |
| (2) | Interest income includes the impact of interest rate risk management contracts, which increased interest income on the underlying assets $925 and $587 in the third and second quarters of 2003 and $397 in the third quarter of 2002, respectively. These amounts were substantially offset by corresponding decreases in the income earned on the underlying assets. Interest expense includes the impact of interest rate risk management contracts, which increased interest expense on the underlying liabilities $141 and $28 in the third and second quarters of 2003 and $69 in the third quarter of 2002, respectively. These amounts were substantially offset by corresponding decreases in the interest paid on the underlying liabilities. |
| (3) | Primarily consists of time deposits in denominations of $100,000 or more. |
| (4) | Includes long-term debt related to trust preferred securities. |
7
Bank of America Corporation
Year-to-Date Average Balances and Interest Rates—Fully Taxable-Equivalent Basis
(Dollars in millions)
| Nine Months Ended September 30 |
||||||||||||||||||
| 2003 |
2002 |
|||||||||||||||||
| Average Balance |
Interest Income/ Expense |
Yield/ Rate |
Average Balance |
Interest Income/ Expense |
Yield/ Rate |
|||||||||||||
| Earning assets |
||||||||||||||||||
| Time deposits placed and other short-term investments |
$ | 8,323 | $ | 123 | 1.98 | % | $ | 10,437 | $ | 187 | 2.40 | % | ||||||
| Federal funds sold and securities purchased under agreements to resell |
72,839 | 867 | 1.59 | 44,451 | 662 | 1.99 | ||||||||||||
| Trading account assets |
98,095 | 3,066 | 4.17 | 78,005 | 2,866 | 4.91 | ||||||||||||
| Securities |
76,131 | 2,460 | 4.31 | 72,450 | 3,022 | 5.56 | ||||||||||||
| Loans and leases(1): |
||||||||||||||||||
| Commercial—domestic |
100,129 | 5,301 | 7.08 | 111,204 | 5,592 | 6.72 | ||||||||||||
| Commercial—foreign |
17,914 | 477 | 3.56 | 21,540 | 644 | 3.99 | ||||||||||||
| Commercial real estate—domestic |
19,891 | 642 | 4.32 | 21,431 | 798 | 4.98 | ||||||||||||
| Commercial real estate—foreign |
295 | 9 | 3.99 | 402 | 13 | 4.34 | ||||||||||||
| Total commercial |
138,229 | 6,429 | 6.22 | 154,577 | 7,047 | 6.09 | ||||||||||||
| Residential mortgage |
121,862 | 4,941 | 5.41 | 93,559 | 4,724 | 6.74 | ||||||||||||
| Home equity lines |
22,783 | 785 | 4.61 | 22,626 | 913 | 5.40 | ||||||||||||
| Direct/Indirect consumer |
32,314 | 1,486 | 6.15 | 30,136 | 1,623 | 7.20 | ||||||||||||
| Consumer finance |
7,256 | 412 | 7.59 | 11,069 | 682 | 8.22 | ||||||||||||
| Credit card |
26,685 | 2,076 | 10.40 | 20,693 | 1,582 | 10.22 | ||||||||||||
| Foreign consumer |
1,990 | 52 | 3.45 | 2,043 | 57 | 3.75 | ||||||||||||
| Total consumer |
212,890 | 9,752 | 6.12 | 180,126 | 9,581 | 7.10 | ||||||||||||
| Total loans and leases |
351,119 | 16,181 | 6.16 | 334,703 | 16,628 | 6.64 | ||||||||||||
| Other earning assets |
45,028 | 1,362 | 4.04 | 23,918 | 1,100 | 6.14 | ||||||||||||
| Total earning assets(2) |
651,535 | 24,059 | 4.93 | 563,964 | 24,465 | 5.79 | ||||||||||||
| Cash and cash equivalents |
22,524 | 21,140 | ||||||||||||||||
| Other assets, less allowance for credit losses |
84,081 | 66,153 | ||||||||||||||||
| Total assets |
$ | 758,140 | $ | 651,257 | ||||||||||||||
| Interest-bearing liabilities |
||||||||||||||||||
| Domestic interest-bearing deposits: |
||||||||||||||||||
| Savings |
$ | 24,216 | $ | 89 | 0.49 | % | $ | 21,539 | $ | 103 | 0.64 | % | ||||||
| NOW and money market deposit accounts |
146,715 | 835 | 0.76 | 130,025 | 1,044 | 1.07 | ||||||||||||
| Consumer CDs and IRAs |
69,235 | 2,309 | 4.46 | 68,176 | 2,240 | 4.39 | ||||||||||||
| Negotiable CDs, public funds and other time deposits |
8,109 | 86 | 1.42 | 4,520 | 112 | 3.29 | ||||||||||||
| Total domestic interest-bearing deposits |
248,275 | 3,319 | 1.79 | 224,260 | 3,499 | 2.09 | ||||||||||||
| Foreign interest-bearing deposits(3): |
||||||||||||||||||
| Banks located in foreign countries |
14,207 | 226 | 2.12 | 15,525 | 338 | 2.91 | ||||||||||||
| Governments and official institutions |
2,071 | 20 | 1.32 | 2,511 | 36 | 1.90 | ||||||||||||
| Time, savings and other |
18,693 | 165 | 1.18 | 19,051 | 269 | 1.89 | ||||||||||||
| Total foreign interest-bearing deposits |
34,971 | 411 | 1.57 | 37,087 | 643 | 2.32 | ||||||||||||
| Total interest-bearing deposits |
283,246 | 3,730 | 1.76 | 261,347 | 4,142 | 2.12 | ||||||||||||
| Federal funds purchased, securities sold under agreements to repurchase and other short-term borrowings |
146,091 | 1,414 | 1.29 | 97,655 | 1,532 | 2.10 | ||||||||||||
| Trading account liabilities |
36,798 | 969 | 3.52 | 31,989 | 971 | 4.06 | ||||||||||||
| Long-term debt(4) |
67,702 | 1,584 | 3.12 | 66,161 | 1,846 | 3.72 | ||||||||||||
| Total interest-bearing liabilities(2) |
533,837 | 7,697 | 1.93 | 457,152 | 8,491 | 2.48 | ||||||||||||
| Noninterest-bearing sources: |
||||||||||||||||||
| Noninterest-bearing deposits |
118,739 | 106,795 | ||||||||||||||||
| Other liabilities |
56,052 | 39,853 | ||||||||||||||||
| Shareholders’ equity |
49,512 | 47,457 | ||||||||||||||||
| Total liabilities and shareholders’ equity |
$ | 758,140 | $ | 651,257 | ||||||||||||||
| Net interest spread |
3.00 | 3.31 | ||||||||||||||||
| Impact of noninterest-bearing sources |
0.35 | 0.47 | ||||||||||||||||
| Net interest income/yield on earning assets |
$ | 16,362 | 3.35 | % | $ | 15,974 | 3.78 | % | ||||||||||
| (1) | Nonperforming loans are included in the respective average loan balances. Income on such nonperforming loans is recognized on a cash basis. |
| (2) | Interest income includes the impact of interest rate risk management contracts, which increased interest income on the underlying assets $2,088 and $1,466 in the nine months ended September 30, 2003 and 2002, respectively. These amounts were substantially offset by corresponding decreases in the income earned on the underlying assets. Interest expense includes the impact of interest rate risk management contracts, which increased interest expense on the underlying liabilities $215 and $79 in the nine months ended September 30, 2003 and 2002, respectively. These amounts were substantially offset by corresponding decreases in the interest paid on the underlying liabilities. |
| (3) | Primarily consists of time deposits in denominations of $100,000 or more. |
| (4) | Includes long-term debt related to trust preferred securities. |
8
Bank of America Corporation
Business Segment View
Net Income
Third Quarter 2003
9
Bank of America Corporation
Consumer and Commercial Banking Segment Results
(Dollars in millions)
| Year-to-Date |
Quarterly |
|||||||||||||||||||||||||||
| Key Measures | 2003 |
2002 |
3 Qtr 03 |
2 Qtr 03 |
1 Qtr 03 |
4 Qtr 02 |
3 Qtr 02 |
|||||||||||||||||||||
| Total revenue* |
$ | 19,517 | $ | 17,424 | $ | 6,894 | $ | 6,590 | $ | 6,033 | $ | 6,192 | $ | 6,051 | ||||||||||||||
| Provision for credit losses |
1,506 | 1,295 | 496 | 522 | 488 | 510 | 420 | |||||||||||||||||||||
| Net income |
5,607 | 4,822 | 2,145 | 1,871 | 1,591 | 1,721 | 1,678 | |||||||||||||||||||||
| Shareholder value added |
4,113 | 3,224 | 1,633 | 1,381 | 1,099 | 1,168 | 1,144 | |||||||||||||||||||||
| Return on average equity |
37.9 | % | 33.5 | % | 42.4 | % | 38.5 | % | 32.6 | % | 34.7 | % | 34.9 | % | ||||||||||||||
| Efficiency ratio* |
47.1 | 49.0 | 44.5 | 47.1 | 50.0 | 47.5 | 49.4 | |||||||||||||||||||||
| Selected Average Balance |
||||||||||||||||||||||||||||
| Sheet Components |
||||||||||||||||||||||||||||
| Total loans and leases |
$ | 187,366 | $ | 181,863 | $ | 188,500 | $ | 187,811 | $ | 185,756 | $ | 184,243 | $ | 182,142 | ||||||||||||||
| Total deposits |
307,335 | 280,221 | 319,641 | 306,447 | 295,654 | 292,259 | 283,769 | |||||||||||||||||||||
| Total earning assets |
336,004 | 280,167 | 346,764 | 339,030 | 321,945 | 314,605 | 286,249 | |||||||||||||||||||||
| Period End (in billions) |
||||||||||||||||||||||||||||
| Mortgage servicing portfolio |
$ | 245.9 | $ | 278.7 | $ | 245.9 | $ | 249.6 | $ | 257.2 | $ | 264.5 | $ | 278.7 | ||||||||||||||
| Mortgage originations: |
||||||||||||||||||||||||||||
| Retail |
80.2 | 37.7 | 30.0 | 28.2 | 22.0 | 22.2 | 15.3 | |||||||||||||||||||||
| Wholesale |
32.5 | 18.4 | 9.5 | 12.2 | 10.8 | 9.7 | 8.6 | |||||||||||||||||||||
| * | Fully taxable-equivalent basis |
Certain prior period amounts have been reclassified among the segments to conform to the current period presentation.
10
Bank of America Corporation
E-Commerce & BankofAmerica.com
Bank of America has the largest active online banking customer base with 6.6 million subscribers. This represents an active customer penetration rate of 41%.
Bank of America uses a strict Active User standard—customers must have used our online services within the last 90 days.
2.8 million active bill pay users paid $12.7 billion worth of bills this quarter. The number of customers who sign up and use Bank of America Bill Pay Service continues to far surpass that of any other financial institution.
Currently, over 270 companies are presenting over 5.0 million e-bills per quarter.
11
Bank of America Corporation
Consumer Credit Card Results
Included within Consumer Products
(Dollars in millions)
| Year-to-Date |
Quarterly |
|||||||||||||||||||||||||||
| 2003 |
2002 |
3 Qtr 03 |
2 Qtr 03 |
1 Qtr 03 |
4 Qtr 02 |
3 Qtr 02 |
||||||||||||||||||||||
| Key Measures |
||||||||||||||||||||||||||||
| Outstandings: |
||||||||||||||||||||||||||||
| Held (Period end) |
$ | 30,993 | $ | 23,062 | $ | 30,993 | $ | 27,419 | $ | 24,819 | $ | 24,729 | $ | 23,062 | ||||||||||||||
| Managed (Period end) |
33,631 | 28,057 | 33,631 | 30,807 | 29,064 | 29,461 | 28,057 | |||||||||||||||||||||
| Held (Average) |
26,685 | 20,693 | 29,113 | 26,211 | 24,684 | 23,535 | 22,263 | |||||||||||||||||||||
| Managed (Average) |
30,463 | 26,997 | 32,225 | 29,970 | 29,161 | 28,406 | 27,540 | |||||||||||||||||||||
| Managed Income Statement: |
||||||||||||||||||||||||||||
| Total revenue |
$ | 3,140 | $ | 2,528 | $ | 1,132 | $ | 1,043 | $ | 965 | $ | 943 | $ | 895 | ||||||||||||||
| Provision for credit losses |
1,422 | 1,156 | 540 | 473 | 409 | 386 | 392 | |||||||||||||||||||||
| Noninterest expense |
827 | 746 | 273 | 279 | 275 | 244 | 254 | |||||||||||||||||||||
| Income before income taxes |
891 | 626 | 319 | 291 | 281 | 313 | 249 | |||||||||||||||||||||
| Shareholder Value Added |
$ | 413 | $ | 270 | $ | 151 | $ | 134 | $ | 128 | $ | 152 | $ | 114 | ||||||||||||||
| Credit Quality: |
||||||||||||||||||||||||||||
| Held: |
||||||||||||||||||||||||||||
| Charge-offs $ |
$ | 1,091 | $ | 796 | $ | 390 | $ | 378 | $ | 323 | $ | 299 | $ | 285 | ||||||||||||||
| Charge-offs % |
5.47 | % | 5.14 | % | 5.32 | % | 5.78 | % | 5.31 | % | 5.03 | % | 5.09 | % | ||||||||||||||
| Managed: |
||||||||||||||||||||||||||||
| Losses $ |
$ | 1,240 | $ | 1,086 | $ | 433 | $ | 429 | $ | 378 | $ | 357 | $ | 356 | ||||||||||||||
| Losses % |
5.44 | % | 5.38 | % | 5.33 | % | 5.74 | % | 5.25 | % | 4.99 | % | 5.13 | % | ||||||||||||||
| Managed Delinquency %: |
||||||||||||||||||||||||||||
| 30+ |
3.84 | % | 3.63 | % | 3.84 | % | 3.99 | % | 4.18 | % | 3.94 | % | 3.63 | % | ||||||||||||||
| 90+ |
1.76 | 1.66 | 1.76 | 1.80 | 1.91 | 1.71 | 1.66 | |||||||||||||||||||||
12
Bank of America Corporation
Global Corporate and Investment Banking Segment Results
(Dollars in millions)
| Year-to-Date |
Quarterly |
|||||||||||||||||||||||||||
| Key Measures | 2003 |
2002 |
3 Qtr 03 |
2 Qtr 03 |
1 Qtr 03 |
4 Qtr 02 |
3 Qtr 02 |
|||||||||||||||||||||
| Total revenue* |
$ | 6,858 | $ | 6,592 | $ | 2,253 | $ | 2,262 | $ | 2,343 | $ | 2,085 | $ | 2,001 | ||||||||||||||
| Provision for credit losses |
542 | 684 | 98 | 172 | 272 | 524 | 203 | |||||||||||||||||||||
| Net income |
1,436 | 1,354 | 513 | 441 | 482 | 207 | 386 | |||||||||||||||||||||
| Shareholder value added |
642 | 370 | 262 | 176 | 204 | (119 | ) | 63 | ||||||||||||||||||||
| Return on average equity |
19.4 | % | 16.1 | % | 21.9 | % | 17.8 | % | 18.6 | % | 7.4 | % | 14.0 | % | ||||||||||||||
| Efficiency ratio*
|
60.3 | 57.7 | 62.1 | 62.7 | 56.4 | 60.3 | 60.4 | |||||||||||||||||||||
| Selected Average Balance Sheet Components |
||||||||||||||||||||||||||||
| Total loans and leases |
$ | 51,319 | $ | 64,029 | $ | 46,243 | $ | 51,285 | $ | 56,543 | $ | 60,475 | $ | 61,032 | ||||||||||||||
| Total deposits |
67,224 | 64,392 | 67,456 | 66,900 | 67,315 | 65,879 | 66,163 | |||||||||||||||||||||
| Total earning assets |
239,803 | 199,206 | 263,161 | 233,125 | 226,145 | 207,767 | 203,537 | |||||||||||||||||||||
| * | Fully taxable-equivalent basis |
Certain prior period amounts have been reclassified among the segments to conform to the current period presentation.
13
Bank of America Corporation
Global Corporate & Investment Banking Strategic Progress Continues
| Source: | Thomson Financial—First Nine Months 2003 |
Significant US market share gains
Convertible debt market share increased substantially year over year, from 4.5% to 8.4%.
The market share for common stock underwriting more than doubled from 1.9% to 4.2% for the first nine months of 2003.
Mortgage-backed securities increased from 6.3% to 7.9% year over year.
14
Bank of America Corporation
Asset Management Segment Results
(Dollars in millions)
| Year-to-Date |
Quarterly |
|||||||||||||||||||||||||||
| Key Measures |
2003 |
2002 |
3 Qtr 03 |
2 Qtr 03 |
1 Qtr 03 |
4 Qtr 02 |
3 Qtr 02 |
|||||||||||||||||||||
| Total revenue* |
$ | 1,805 | $ | 1,791 | $ | 615 | $ | 612 | $ | 578 | $ | 588 | $ | 571 | ||||||||||||||
| Provision for credit losses |
(3 | ) | 288 | (2 | ) | 3 | (4 | ) | 30 | 118 | ||||||||||||||||||
| Net income |
408 | 267 | 123 | 145 | 140 | 108 | 63 | |||||||||||||||||||||
| Shareholder value added |
185 | 54 | 48 | 71 | 66 | 26 | (14 | ) | ||||||||||||||||||||
| Return on average equity |
19.7 | % | 14.8 | % | 17.7 | % | 21.1 | % | 20.4 | % | 15.6 | % | 9.7 | % | ||||||||||||||
| Efficiency ratio* |
65.7 | 61.4 | 70.5 | 63.1 | 63.3 | 67.2 | 63.7 | |||||||||||||||||||||
| Selected Average Balance |
||||||||||||||||||||||||||||
| Sheet Components |
||||||||||||||||||||||||||||
| Total loans and leases |
$ | 22,920 | $ | 24,242 | $ | 23,205 | $ | 22,866 | $ | 22,683 | $ | 22,950 | $ | 23,637 | ||||||||||||||
| Total deposits |
12,962 | 11,860 | 13,313 | 12,710 | 12,859 | 12,531 | 11,967 | |||||||||||||||||||||
| Total earning assets |
23,788 | 24,859 | 24,156 | 23,784 | 23,415 | 23,693 | 24,238 | |||||||||||||||||||||
| Period End (in billions) |
||||||||||||||||||||||||||||
| Assets under management |
$ | 318.1 | $ | 271.9 | $ | 318.1 | $ | 314.9 | $ | 297.0 | $ | 310.4 | $ | 271.9 | ||||||||||||||
| Client brokerage assets |
90.7 | 87.1 | 90.7 | 90.6 | 90.8 | 90.9 | 87.1 | |||||||||||||||||||||
| Assets in custody |
47.3 | 42.1 | 47.3 | 47.9 | 45.1 | 46.5 | 42.1 | |||||||||||||||||||||
| Total client assets |
$ | 456.1 | $ | 401.1 | $ | 456.1 | $ | 453.4 | $ | 432.9 | $ | 447.8 | $ | 401.1 | ||||||||||||||
| * | Fully taxable-equivalent basis |
Certain prior period amounts have been reclassified among the segments to conform to the current period presentation.
15
Bank of America Corporation
Equity Investments Segment Results
| (Dollars in millions) | ||||||||||||||||||||||||||||
| Year-to-Date |
Quarterly |
|||||||||||||||||||||||||||
| Key Measures |
2003 |
2002 |
3 Qtr 03 |
2 Qtr 03 |
1 Qtr 03 |
4 Qtr 02 |
3 Qtr 02 |
|||||||||||||||||||||
| Total revenue* |
$ | (199 | ) | $ | (346 | ) | $ | (80 | ) | $ | (12 | ) | $ | (107 | ) | $ | (100 | ) | $ | (233 | ) | |||||||
| Provision for credit losses |
4 | — | — | 3 | 1 | 7 | — | |||||||||||||||||||||
| Net income |
(182 | ) | (248 | ) | (68 | ) | (28 | ) | (86 | ) | (83 | ) | (161 | ) | ||||||||||||||
| Shareholder value added |
(351 | ) | (437 | ) | (126 | ) | (84 | ) | (141 | ) | (146 | ) | (223 | ) | ||||||||||||||
| Return on average equity |
(11.7 | )% | (15.6 | )% | (13.0 | )% | (5.5 | )% | (16.7 | )% | (15.6 | )% | (30.6 | )% | ||||||||||||||
| Efficiency ratio* |
(41.4 | ) | (18.2 | ) | (35.2 | ) | n/m | (24.2 | ) | (27.4 | ) | (11.5 | ) | |||||||||||||||
| Selected Average Balance | ||||||||||||||||||||||||||||
| Sheet Components | ||||||||||||||||||||||||||||
| Total loans and leases |
$ | 313 | $ | 440 | $ | 93 | $ | 414 | $ | 434 | $ | 438 | $ | 446 | ||||||||||||||
| Total earning assets |
313 | 443 | 93 | 414 | 434 | 438 | 446 | |||||||||||||||||||||
| Period End | ||||||||||||||||||||||||||||
| Investment balances for Principal Investing |
$ | 5,430 | $ | 5,429 | $ | 5,430 | $ | 5,436 | $ | 5,435 | $ | 5,395 | $ | 5,429 | ||||||||||||||
| * | Fully taxable-equivalent basis |
n/m = not meaningful
Certain prior period amounts have been reclassified among the segments to conform to the current period presentation.
16
Bank of America Corporation
Corporate Other Results(1)
| (Dollars in millions) | |||||||||||||||||||||||||||
| Year-to-Date |
Quarterly |
||||||||||||||||||||||||||
| Key Measures |
2003 |
2002 |
3 Qtr 03 |
2 Qtr 03 |
1 Qtr 03 |
4 Qtr 02 |
3 Qtr 02 |
||||||||||||||||||||
| Total revenue* |
$ | 760 | $ | 654 | $ | 234 | $ | 327 | $ | 199 | $ | 202 | $ | 295 | |||||||||||||
| Provision for credit losses |
207 | 265 | 59 | 72 | 76 | 94 | 63 | ||||||||||||||||||||
| Net income(2) |
815 | 440 | 209 | 309 | 297 | 661 | 269 | ||||||||||||||||||||
| Shareholder value added |
(411 | ) | (665 | ) | (193 | ) | (130 | ) | (88 | ) | 285 | (90 | ) | ||||||||||||||
| Selected Average Balance | |||||||||||||||||||||||||||
| Sheet Components | |||||||||||||||||||||||||||
| Total loans and leases |
$ | 89,201 | $ | 64,129 | $ | 99,247 | $ | 87,903 | $ | 80,246 | $ | 74,994 | $ | 73,227 | |||||||||||||
| Total deposits |
14,464 | 11,669 | 14,159 | 19,250 | 9,932 | 10,712 | 12,034 | ||||||||||||||||||||
| Total earning assets |
180,976 | 143,121 | 182,648 | 199,028 | 161,018 | 171,269 | 158,047 | ||||||||||||||||||||
| * | Fully taxable-equivalent basis |
| (1) | Corporate Other consists primarily of gains and losses associated with managing the balance sheet of the Corporation, certain consumer finance and commercial lending businesses being liquidated, and certain residential mortgages originated by the mortgage group or otherwise acquired and held for asset/liability management purposes. |
| (2) | The fourth quarter of 2002 includes $488 tax benefit related to the settlement of federal income tax returns through 1999. |
Certain prior period amounts have been reclassified among the segments to conform to the current period presentation.
17
Bank of America Corporation
Net Charge-offs and Net Charge-off Ratios
(Dollars in millions)
| 3Q02 |
4Q02 |
1Q03 |
2Q03 |
3Q03 |
|||||||||||||||||||||||||||
| Amount |
Ratio |
Amount |
Ratio |
Amount |
Ratio |
Amount |
Ratio |
Amount |
Ratio |
||||||||||||||||||||||
| Commercial—domestic |
$ | 240 | 0.90 | % | $ | 478 | 1.80 | % | $ | 239 | 0.94 | % | $ | 221 | 0.88 | % | $ | 203 | 0.84 | % | |||||||||||
| Commercial—foreign |
148 | 2.77 | 205 | 3.95 | 120 | 2.57 | 53 | 1.19 | 58 | 1.36 | |||||||||||||||||||||
| Commercial real estate—domestic |
6 | 0.12 | 9 | 0.20 | 9 | 0.18 | 10 | 0.21 | 13 | 0.26 | |||||||||||||||||||||
| Total commercial |
394 | 1.05 | 692 | 1.87 | 368 | 1.04 | 284 | 0.82 | 274 | 0.82 | |||||||||||||||||||||
| Residential mortgage |
5 | 0.02 | 18 | 0.07 | 2 | 0.01 | 11 | 0.04 | 14 | 0.04 | |||||||||||||||||||||
| Home equity lines |
5 | 0.08 | 6 | 0.10 | 6 | 0.11 | 6 | 0.11 | 2 | 0.02 | |||||||||||||||||||||
| Direct/Indirect consumer |
48 | 0.63 | 60 | 0.78 | 56 | 0.72 | 38 | 0.47 | 39 | 0.47 | |||||||||||||||||||||
| Consumer finance |
54 | 2.13 | 77 | 3.44 | 68 | 3.42 | 46 | 2.52 | 44 | 2.74 | |||||||||||||||||||||
| Credit card |
285 | 5.09 | 299 | 5.03 | 323 | 5.31 | 378 | 5.78 | 390 | 5.32 | |||||||||||||||||||||
| Other consumer—domestic |
11 | n/m | 11 | n/m | 9 | n/m | 8 | n/m | 11 | n/m | |||||||||||||||||||||
| Foreign consumer |
2 | 0.32 | 2 | 0.38 | 1 | 0.20 | 1 | 0.28 | 2 | 0.31 | |||||||||||||||||||||
| Total consumer |
410 | 0.85 | 473 | 0.95 | 465 | 0.93 | 488 | 0.93 | 502 | 0.89 | |||||||||||||||||||||
| Total net charge-offs |
$ | 804 | 0.94 | $ | 1,165 | 1.35 | $ | 833 | 0.98 | $ | 772 | 0.88 | $ | 776 | 0.86 | ||||||||||||||||
| By Business Segment: |
|||||||||||||||||||||||||||||||
| Consumer & commercial banking |
$ | 420 | 0.92 | % | $ | 509 | 1.10 | % | $ | 488 | 1.06 | % | $ | 522 | 1.12 | % | $ | 539 | 1.13 | % | |||||||||||
| Global corporate & investment banking |
203 | 1.32 | 526 | 3.44 | 272 | 1.96 | 172 | 1.34 | 170 | 1.46 | |||||||||||||||||||||
| Asset management |
118 | 1.99 | 30 | 0.52 | (4 | ) | (0.06 | ) | 3 | 0.04 | 2 | 0.04 | |||||||||||||||||||
| Equity investments |
0 | n/m | 7 | 6.26 | 1 | 0.72 | 3 | 3.36 | 0 | n/m | |||||||||||||||||||||
| Corporate other |
63 | 0.34 | 93 | 0.50 | 76 | 0.38 | 72 | 0.33 | 65 | 0.26 | |||||||||||||||||||||
| Total net charge-offs |
$ | 804 | 0.94 | $ | 1,165 | 1.35 | $ | 833 | 0.98 | $ | 772 | 0.88 | $ | 776 | 0.86 | ||||||||||||||||
Loans are classified as domestic or foreign based upon the domicile of the borrower.
n/m = not meaningful
18
Bank of America Corporation
Nonperforming Assets
(Dollars in millions)
| 3Q02 |
4Q02 |
1Q03 |
2Q03 |
3Q03 |
||||||||||||||||
| Commercial—domestic |
$ | 3,132 | $ | 2,781 | $ | 2,605 | $ | 2,265 | $ | 1,861 | ||||||||||
| Commercial—foreign |
854 | 1,359 | 1,279 | 1,040 | 756 | |||||||||||||||
| Commercial real estate—domestic |
172 | 161 | 173 | 154 | 154 | |||||||||||||||
| Commercial real estate—foreign |
3 | 3 | 3 | 2 | 2 | |||||||||||||||
| Total commercial |
4,161 | 4,304 | 4,060 | 3,461 | 2,773 | |||||||||||||||
| Residential mortgage |
585 | 612 | 628 | 618 | 563 | |||||||||||||||
| Home equity lines |
57 | 66 | 63 | 55 | 42 | |||||||||||||||
| Direct/Indirect consumer |
31 | 30 | 28 | 33 | 32 | |||||||||||||||
| Consumer finance |
8 | 19 | 18 | 11 | 12 | |||||||||||||||
| Foreign consumer |
7 | 6 | 9 | 9 | 7 | |||||||||||||||
| Total consumer |
688 | 733 | 746 | 726 | 656 | |||||||||||||||
| Total nonperforming loans |
4,849 | 5,037 | 4,806 | 4,187 | 3,429 | |||||||||||||||
| Foreclosed properties |
282 | 225 | 227 | 243 | 228 | |||||||||||||||
| Total nonperforming assets(1) |
$ | 5,131 | $ | 5,262 | $ | 5,033 | $ | 4,430 | $ | 3,657 | ||||||||||
| Loans past due 90 days or more and still accruing |
$ | 726 | $ | 764 | $ | 808 | $ | 726 | $ | 788 | ||||||||||
| Nonperforming Assets / Total Assets |
0.78 | % | 0.80 | % | 0.74 | % | 0.58 | % | 0.50 | % | ||||||||||
| Nonperforming Assets / Total Loans, Leases and Foreclosed Properties |
1.50 | 1.53 | 1.46 | 1.23 | 0.98 | |||||||||||||||
| Nonperforming Loans / Total Loans and Leases |
1.42 | 1.47 | 1.40 | 1.16 | 0.92 | |||||||||||||||
| Allowance for Credit Losses |
$ | 6,861 | $ | 6,851 | $ | 6,853 | $ | 6,841 | $ | 6,716 | ||||||||||
| Allowance / Total Loans and Leases |
2.01 | % | 2.00 | % | 2.00 | % | 1.90 | % | 1.80 | % | ||||||||||
| Allowance / Total Nonperforming Loans |
142 | 136 | 143 | 163 | 196 | |||||||||||||||
Loans are classified as domestic or foreign based upon the domicile of the borrower.
| (1) | Balances do not include $82, $98, $174, $120 and $184 of nonperforming assets included in other assets at September 30, 2003, June 30, 2003, March 31, 2003, December 31, 2002 and September 30, 2002, respectively. |
19
Bank of America Corporation
Significant Industry Non-Real Estate Outstanding Commercial Loans and Leases
(Dollars in millions)
| September 30 2003 |
December 31 2002 |
Increase (Decrease) from 12/31/02 |
|||||||
| Retailing |
$ | 10,941 | $ | 10,572 | 3 | % | |||
| Transportation |
8,013 | 8,030 | 0 | ||||||
| Leisure and sports, hotels and restaurants |
7,557 | 8,139 | (7 | ) | |||||
| Food, beverage and tobacco |
7,126 | 7,335 | (3 | ) | |||||
| Education and government |
6,767 | 5,624 | 20 | ||||||
| Capital goods |
6,225 | 7,088 | (12 | ) | |||||
| Commercial services and supplies |
6,001 | 6,449 | (7 | ) | |||||
| Materials |
5,945 | 7,972 | (25 | ) | |||||
| Diversified financials |
5,863 | 8,344 | (30 | ) | |||||
| Health care equipment and services |
4,291 | 3,912 | 10 | ||||||
| Utilities |
3,480 | 5,590 | (38 | ) | |||||
| Media |
3,353 | 5,911 | (43 | ) | |||||
| Religious and social organizations |
2,831 | 2,426 | 17 | ||||||
| Energy |
2,562 | 3,076 | (17 | ) | |||||
| Consumer durables and apparel |
2,459 | 2,591 | (5 | ) | |||||
| Telecommunications services |
2,064 | 3,105 | (34 | ) | |||||
| Banks |
1,755 | 1,881 | (7 | ) | |||||
| Food and drug retailing |
1,296 | 1,344 | (4 | ) | |||||
| Technology hardware and equipment |
1,130 | 1,368 | (17 | ) | |||||
| Automobiles and components |
1,129 | 1,024 | 10 | ||||||
| Insurance |
943 | 1,616 | (42 | ) | |||||
| Other (1) |
20,236 | 21,568 | (6 | ) | |||||
| Total |
$ | 111,967 | $ | 124,965 | (10 | ) | |||
| (1) | At September 30, 2003 and December 31, 2002, Other includes $9,486 and $9,090, respectively, of loans outstanding to individuals and trusts, representing 2.5% and 2.7% of total outstanding loans and leases, respectively. The remaining balance in Other includes loans to industries which primarily include software and services, pharmaceuticals and biotechnology, and household and personal products. |
Outstanding Loans and Leases
(Dollars in millions)
| September 30 2003 |
December 31 2002 |
Increase (Decrease) from 12/31/02 |
||||||||
| Commercial—domestic |
$ | 94,870 | $ | 105,053 | $ | (10,183 | ) | |||
| Commercial—foreign |
17,097 | 19,912 | (2,815 | ) | ||||||
| Commercial real estate—domestic |
19,377 | 19,910 | (533 | ) | ||||||
| Commercial real estate—foreign |
305 | 295 | 10 | |||||||
| Total commercial |
131,649 | 145,170 | (13,521 | ) | ||||||
| Residential mortgage |
146,424 | 108,197 | 38,227 | |||||||
| Home equity lines |
22,675 | 23,236 | (561 | ) | ||||||
| Direct/Indirect consumer |
33,391 | 31,068 | 2,323 | |||||||
| Consumer finance |
6,020 | 8,384 | (2,364 | ) | ||||||
| Credit card |
30,993 | 24,729 | 6,264 | |||||||
| Foreign consumer |
1,946 | 1,971 | (25 | ) | ||||||
| Total consumer |
241,449 | 197,585 | 43,864 | |||||||
| Total |
$ | 373,098 | $ | 342,755 | $ | 30,343 | ||||
20
Bank of America Corporation
Emerging Markets
| (Dollars in millions) | Total Foreign Exposure September 30, 2003 |
Increase/ (Decrease) from December 31, 2002 |
|||||||||||||||||||||||
| Total Cross- border Exposure(3) |
Gross Local Country Exposure(4) |
||||||||||||||||||||||||
| Loans and Loan Commitments |
Other Financing(1) |
Derivative Assets |
Securities/ Other Investments(2) |
||||||||||||||||||||||
| Region/Country |
|||||||||||||||||||||||||
| Asia |
|||||||||||||||||||||||||
| China |
$ | 56 | $ | 7 | $ | 54 | $ | 24 | $ | 141 | $ | 69 | $ | 210 | $ | (34 | ) | ||||||||
| Hong Kong(5) |
142 | 66 | 93 | 106 | 407 | 3,496 | 3,903 | 99 | |||||||||||||||||
| India |
329 | 335 | 54 | 251 | 969 | 1,104 | 2,073 | 700 | |||||||||||||||||
| Indonesia |
49 | 0 | 15 | 19 | 83 | 6 | 89 | (31 | ) | ||||||||||||||||
| South Korea |
518 | 718 | 49 | 38 | 1,323 | 715 | 2,038 | 802 | |||||||||||||||||
| Malaysia |
7 | 6 | 1 | 16 | 30 | 141 | 171 | (69 | ) | ||||||||||||||||
| Philippines |
22 | 16 | 4 | 64 | 106 | 66 | 172 | 16 | |||||||||||||||||
| Singapore |
198 | 10 | 74 | 1 | 283 | 1,151 | 1,434 | (234 | ) | ||||||||||||||||
| Taiwan |
259 | 147 | 41 | 0 | 447 | 548 | 995 | (94 | ) | ||||||||||||||||
| Thailand |
36 | 4 | 12 | 37 | 89 | 284 | 373 | 110 | |||||||||||||||||
| Other |
7 | 17 | 2 | 0 | 26 | 90 | 116 | 13 | |||||||||||||||||
| Total |
1,623 | 1,326 | 399 | 556 | 3,904 | 7,670 | 11,574 | 1,278 | |||||||||||||||||
| Central and Eastern Europe |
|||||||||||||||||||||||||
| Turkey |
9 | 8 | 0 | 19 | 36 | 0 | 36 | (22 | ) | ||||||||||||||||
| Other |
15 | 14 | 36 | 210 | 275 | 1 | 276 | (30 | ) | ||||||||||||||||
| Total |
24 | 22 | 36 | 229 | 311 | 1 | 312 | (52 | ) | ||||||||||||||||
| Latin America |
|||||||||||||||||||||||||
| Argentina |
152 | 29 | 2 | 88 | 271 | 83 | 354 | (111 | ) | ||||||||||||||||
| Brazil |
170 | 329 | 8 | 95 | 602 | 223 | 825 | (350 | ) | ||||||||||||||||
| Chile |
74 | 48 | 6 | 14 | 142 | 0 | 142 | 1 | |||||||||||||||||
| Colombia |
37 | 15 | 1 | 7 | 60 | 0 | 60 | (28 | ) | ||||||||||||||||
| Mexico |
638 | 164 | 140 | 1,879 | 2,821 | 163 | 2,984 | 1,395 | |||||||||||||||||
| Venezuela |
95 | 1 | 0 | 131 | 227 | 0 | 227 | (5 | ) | ||||||||||||||||
| Other |
96 | 70 | 0 | 24 | 190 | 0 | 190 | (35 | ) | ||||||||||||||||
| Total |
1,262 | 656 | 157 | 2,238 | 4,313 | 469 | 4,782 | 867 | |||||||||||||||||
| Total |
$ | 2,909 | $ | 2,004 | $ | 592 | $ | 3,023 | $ | 8,528 | $ | 8,140 | $ | 16,668 | $ | 2,093 | |||||||||
| (1) | Includes acceptances, standby letters of credit, commercial letters of credit and formal guarantees. |
| (2) | Amounts outstanding in the table above for Philippines, Argentina, Mexico, Venezuela and Latin America Other have been reduced by $13, $44, $0, $141 and $39, respectively, at September 30, 2003, and $12, $90, $505, $131 and $37, respectively, at December 31, 2002. Such amounts represent the fair value of U.S. Treasury securities held as collateral outside the country of exposure. |
| (3) | Cross-border exposure includes amounts payable to the Corporation by residents of countries other than the one in which the credit is booked, regardless of the currency in which the claim is denominated, consistent with Federal Financial Institutions Examinations Council (FFIEC) reporting rules. |
| (4) | Gross local country exposure includes amounts payable to the Corporation by residents of countries in which the credit is booked, regardless of the currency in which the claim is denominated. Management does not net local funding or liabilities against local exposures as allowed by the FFIEC. |
| (5) | Gross local country exposure to Hong Kong consisted of $1,885 of consumer loans and $1,611 of commercial exposure at September 30, 2003 compared to $1,828 of consumer loans and $1,572 of commercial exposure at December 31, 2002. The consumer loans were collateralized primarily by residential real estate. The commercial exposure was primarily to local clients and was diversified across many industries. |
21