Exhibit 99.1

 

October 19, 2005

 

Investors may contact:

Kevin Stitt, Bank of America, 704.386.5667

Lee McEntire, Bank of America, 704.388.6780

Leyla Pakzad, Bank of America, 704.386.2024

 

Media may contact:

Terry Francisco, Bank of America, 704.386.4343

 

Bank of America reports quarterly earnings of $4.13 billion, or $1.02 per share

 

Double digit revenue growth across all business segments

 

Investment banking, trading results increase

 

Efficiency ratio remains below 50 percent

 

Strong performance in card services

 

Average retail deposits up 10%

 

CHARLOTTE — Bank of America Corporation today reported that third quarter net income rose 10 percent to $4.13 billion from $3.76 billion a year earlier. Per share earnings increased 12 percent to $1.02 per share (diluted) from, $0.91 per share. Return on average common equity in the third quarter was 16.33 percent.

 

Excluding merger and restructuring charges of $120 million pre-tax, equal to 2 cents per share, the company earned $1.04 per share.

 

Improved results were driven by a 16 percent increase in revenue, reflecting continued success in growth initiatives in all of Bank of America’s major business segments. Revenue growth was driven primarily by increases in noninterest income, including continued strength in card results, service fees, a rebound in mortgage banking income, improved trading account profits and higher equity investment gains.

 

The growth in revenue, coupled with a 4 percent increase in noninterest expense, produced significant positive operating leverage of 12 percentage points.

 

For the first nine months of 2005, Bank of America earned $13.12 billion, or $3.22 per share (diluted), compared to $10.29 billion, or $2.76 per share, a year earlier.

 

“We had across the board increases in the business segments that make up our total revenue,” said Kenneth D. Lewis, chairman and chief executive officer. “This is a tribute to the power and balance of our franchise, the talent and energy of our associates and the continued improvements to the customer experience using Six Sigma and other processes. Combined with continued excellent expense control, we continue to produce significant positive operating leverage that is producing value for our shareholders.”


Page 2

 

Business Highlights

 

    The bank added a record 635,000 net new retail checking accounts in the quarter and 294,000 net new savings accounts. Total checking and savings accounts now are more than 51 million.

 

    Total average retail deposit balances increased nearly $38 billion, or 10 percent, from a year ago to more than $434 billion, driven by increased sales of checking products such as My Access and Campus Edge from both banking store and online sales channels.

 

    Average loans and leases grew 7 percent from a year ago to $539.5 billion.

 

    Average managed consumer credit card outstandings rose 9 percent to a record $59.8 billion, as the company added 1.5 million new consumer credit card accounts in the quarter.

 

    First mortgage loans originated in the third quarter rose to $27.5 billion, $10.9 billion higher than the third quarter of 2004, as borrowers took advantage of a favorable rate environment during the quarter.

 

    Debit card activity grew substantially from the same period last year, as purchase volumes soared 28 percent and revenue increased 29 percent to $421 million.

 

    Trading-related revenue climbed to $800 million in the third quarter from $584 million in the third quarter of 2004, boosted by improved results in equities and fixed income and interest rate-related trading.

 

    Investment banking income on a consolidated basis increased 19 percent from a year ago due to substantial increases in equity underwriting and advisory services fees.

 

    Assets under management grew 6 percent in Global Wealth and Investment Management from a year earlier.

 

    Based on assets under management weighted over 3 years, 70 percent of Columbia Management Group’s funds (equity, fixed, money market funds) are in the top 25th percentile of Lipper’s overall rankings of the mutual fund industry.1

 

    53 percent of Columbia Management’s equity and fixed income funds are rated 4 or 5 stars by Morningstar as of September 30, 2005. 2

 

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Page 3

 

Customer Highlights

 

    Bank of America recently introduced its Keep the Change™ program, which provides a free savings feature tied to a debit card. When customers sign up for Keep the Change, the amount of every purchase they make with a Bank of America debit card is automatically rounded up to the nearest whole dollar and the difference is transferred from their checking accounts into their savings accounts at the end of the day. Bank of America will match 100 percent of the Keep the Change transfers for the first three months. After that the bank will contribute five percent of contributions each year, with a maximum match of $250 annually.

 

    Bank of America introduced a new convenient nationwide service that allows customers to make remittances to Mexico for free. Called SafeSend®, the new free feature is available to anyone who has a Bank of America personal checking account. Earlier this year, Bank of America became the first major financial institution in the United States to offer free remittances when it introduced the product in Chicago.

 

    Bank of America was named best consumer Internet bank in the United States by Global Finance magazine as part of its “World’s Best Internet Banks” competition. Global Finance magazine also gave Bank of America awards for the best information security initiatives, best bill pay and presentment, as well as best online consumer credit in North America. Bank of America is the leading online banking site, with 14.3 million active online banking customers, 7.0 million active bill pay customers, and more than 1.4 billion visits annually to bankofamerica.com.

 

    While Bank of America has limited operations in Louisiana, Alabama and Mississippi, the bank has developed special product and service programs to assist customers affected by Hurricane Katrina within the federal disaster area, as designated by FEMA. These programs include payment deferrals for credit cards, mortgages, home equity lines of credit, and auto/boat/RV loans. Bank of America and its associates have given in excess of $4 million to aid the victims of Hurricane Katrina. Bank of America also previously announced a $100 million Community Development Banking goal to rebuild affordable housing and revitalize neighborhoods in Gulf Coast areas devastated by Hurricanes Katrina and Rita.

 

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Page 4

 

Third Quarter 2005 Financial Summary

 

Revenue

 

Revenue on a fully taxable-equivalent basis grew 16 percent to $14.81 billion from $12.76 billion the previous year.

 

Net interest income on a fully taxable-equivalent basis was $7.97 billion, up almost 2 percent from $7.84 billion a year earlier, as the impact of continued success in growing loans and deposits was dampened by continued relatively low long-term interest rates and a flatter yield curve. Specifically, the increase in net interest income was driven by growth in consumer and middle-market business loans, higher domestic deposit levels, and a larger asset-liability management portfolio. These increases were partially offset by margin compression resulting from a flattening yield curve and a lower trading-related net interest income contribution. Net interest income was up almost 2 percent from the second quarter of 2005. The net interest yield in the third quarter was 2.80 percent, down 1 basis point from the second quarter and 50 basis points from a year earlier.

 

Noninterest income rose 39 percent to $6.83 billion from $4.92 billion a year earlier. These results were driven by higher card income, equity investment gains and trading account profits. Mortgage banking income rebounded from a $250 million loss the previous year related to writedowns associated with mortgage servicing rights.

 

During the quarter, the company realized $29 million in debt securities gains compared to $732 million in the third quarter of 2004.

 

Efficiency

 

With strong revenue growth and continued expense control, the efficiency ratio for the third quarter of 2005, including merger and restructuring charges, improved to 49.20 percent (48.39 percent excluding merger and restructuring charges). Noninterest expense increased 4 percent to $7.29 billion compared to $7.02 billion a year ago, due primarily to increases in revenue-related incentive compensation resulting from improved performance. Full year 2005 cost savings from the merger with FleetBoston Financial Corporation are estimated to be $1.85 billion.

 

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Page 5

 

Credit Quality

 

Credit quality was generally stable, however the rate of improvement in commercial credit quality slowed. Charge-offs and provision expense rose. The company took $209 million in previously-reserved-for charge-offs associated with the domestic airline industry. Consumer loan reserves increased, reflecting growth and seasoning in the credit card portfolio including returning securitizations. A $50 million reserve was established for estimated losses associated with Hurricane Katrina.

 

    Provision for credit losses was $1.16 billion, up from $875 million in the second quarter of 2005 and $650 million a year earlier.

 

    Net charge-offs were $1.15 billion, or 0.84 percent of average loans and leases. This compared to $880 million, or 0.68 percent, in the second quarter of 2005 and $719 million, or 0.57 percent of average loans and leases, in the third quarter of 2004.

 

    Nonperforming assets decreased to $1.60 billion, or 0.29 percent of total loans, leases and foreclosed properties, at September 30, 2005. This compared to $1.90 billion, or 0.36 percent, at June 30, 2005 and $2.84 billion, or 0.55 percent, at September 30, 2004.

 

    The allowance for loan and lease losses was $8.33 billion, or 1.50 percent of loans and leases, at September 30, 2005. This compared to $8.32 billion, or 1.57 percent, at June 30, 2005 and $8.72 billion, or 1.70 percent, at September 30, 2004.

 

Capital Management

 

Total shareholders’ equity was $101.3 billion at September 30, 2005. Period-end assets grew to $1.25 trillion. The Tier 1 Capital Ratio was 8.21 percent, compared to 8.06 percent at June 30, 2005 and 8.08 percent a year ago.

 

During the quarter, Bank of America paid a cash dividend of $0.50 per share. The company also issued 7.0 million shares, primarily related to employee stock options and ownership plans, and repurchased 10.6 million shares. Period-ending common shares issued and outstanding were 4.01 billion in the third quarter, compared to 4.02 billion in the second quarter of 2005 and 4.05 billion in the third quarter of 2004.

 

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Page 6

 

Third Quarter 2005 Business Segment Results

 

Global Consumer and Small Business Banking

 

(Dollars in millions)


   Third Quarter 2005

    Third Quarter 2004

 

Total Revenue 1

   $ 7,402     $ 6,578  

Provision for credit losses

     1,107       1,012  

Noninterest expense

     3,328       3,317  

Net Income

     1,884       1,503  

Efficiency ratio

     45.0 %     50.4 %

Return on average equity

     22.8       18.3  

Loans and leases2

   $ 145,715     $ 134,201  

Deposits2

     310,495       306,367  

 

1 Fully taxable-equivalent basis

 

2 Balances averaged for period

 

Continued strong growth in the card business, significant increases in home equity loans, a rebound in mortgage banking, and continuing account growth which has led to market share gains in retail deposits, drove Global Consumer and Small Business Banking’s 25 percent increase in net income. Revenue rose 12 percent.

 

Card income rose more than 21 percent to $1.4 billion as a result of increased customer activity, growth in managed outstandings and the impact of the National Processing Corporation acquisition in the fourth quarter of 2004. Provision expense increased primarily due to higher card charge-offs resulting from growth and seasoning of the portfolio.

 

The bank’s mortgage unit benefited from an improved interest rate environment in the quarter along with a reduced cost structure for originating and servicing first mortgages and home equity loans. Average outstandings on home equity loans across all business units increased 31 percent to $65.7 billion from the third quarter of 2004. Results were significantly better than a year ago, primarily due to a writedown of mortgage servicing rights in the third quarter of 2004.

 

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Page 7

 

Global Business and Financial Services

 

(Dollars in millions)


   Third Quarter 2005

    Third Quarter 2004

 

Total Revenue 1

   $ 2,854     $ 2,519  

Provision for credit losses

     79       (236 )

Noninterest expense

     1,052       921  

Net Income

     1,102       1,190  

Efficiency ratio

     36.9 %     36.6 %

Return on average equity

     15.1       15.9  

Loans and leases2

   $ 183,937     $ 164,811  

Deposits2

     107,963       102,252  

 

1 Fully taxable-equivalent basis

 

2 Balances averaged for period

 

Global Business and Financial Services benefited in the quarter from continued strong loan growth across all business lines, including the purchase of loans from General Motors Acceptance Corporation. Net income declined as provision expense increased. Revenue grew more than 13 percent.

 

Average loans and leases in Global Business and Financial Services grew more than $19 billion from the third quarter of 2004, or 12 percent, as commercial activity continued to increase. Middle market business loans and leases grew more than 10 percent with strong growth across all geographic regions.

 

Revenue growth was driven by strong net interest income on loans and deposits in Commercial Real Estate and Business Banking.

 

Provision expense increased $315 million, primarily due to a slower rate of improvement in commercial credit quality and higher net charge-offs.

 

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Page 8

 

Global Capital Markets and Investment Banking

 

(Dollars in millions)


   Third Quarter 2005

    Third Quarter 2004

 

Total Revenue 1

   $ 2,323     $ 2,066  

Trading-related revenue

     800       584  

Investment banking income

     491       420  

Provision for credit losses

     (69 )     (152 )

Noninterest expense

     1,715       1,508  

Net Income

     434       471  

Efficiency ratio

     73.9 %     73.0 %

Return on average equity

     16.9       17.3  

Loans and leases2

   $ 32,280     $ 35,370  

Deposits2

     83,042       72,224  

Trading-related earning assets2

     312,441       222,042  

 

1 Fully taxable-equivalent basis

 

2 Balances averaged for period

 

Strong trading results and increased market share gains in investment banking for Global Capital Markets and Investment Banking drove revenue 12 percent higher. Net income declined as provision increased and expenses rose as the company continued to invest in the business.

 

Trading-related results benefited from increased profits in fixed income, equities, interest rate and foreign exchange products.

 

Investment banking income was up 17 percent, driven by increased activity in equity underwriting and advisory services.

 

During the quarter, Banc of America Securities achieved significant gains in market share as tabulated by Thomson Financial. Year-to-date, the unit increased its market share in underwriting investment grade debt to 8 percent and rose in rankings to 4th from 8th for the first nine months of 2004. Banc of America Securities maintained its number one ranking in high yield debt underwriting for the year, and maintained top five underwriting rankings in syndicated loans, leveraged loans, and mortgage-backed securities.

 

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Page 9

 

Global Wealth and Investment Management

 

(Dollars in millions)


   Third Quarter 2005

    Third Quarter 2004

 

Total Revenue 1

   $ 1,835     $ 1,605  

Provision for credit losses

     1       (18 )

Noninterest expense

     914       873  

Net Income

     583       476  

Efficiency ratio

     49.9 %     54.4 %

Return on average equity

     23.2       20.2  

Average loans and leases2

   $ 55,175     $ 45,654  

Average deposits2

     116,068       87,909  

(in billions)


   At 9/30/05

    At 9/30/04

 

Assets under management

   $ 457.4     $ 429.5  

 

1 Fully taxable-equivalent basis

 

2 Balances averaged for period

 

Global Wealth and Investment Management increased net income by 22 percent from third quarter 2004 as increased asset management fees, higher loan volume and migration of deposits to Premier Banking from Consumer Banking drove results.

 

Asset management fees increased 7 percent from the third quarter of 2004 as the unit experienced 6 percent growth in assets under management. Growth in assets under management was mainly due to net inflows of $3.6 billion and the positive impact of $24.2 billion in increased market values.

 

Sales of brokerage services to Premier clients, the mass affluent sector, continued to grow, with 30 percent currently using these investment services in addition to banking products, up from 25 percent at the end of 2004.

 

All Other

 

All Other reflected $124 million of net income for the quarter, the same as the third quarter of 2004. Equity Investment gains were $564 million in the third quarter of 2005 compared to $182 million in the third quarter of 2004. All Other also included debt securities gains related to asset/liability management of $13 million, compared to $614 million in the third quarter of 2004.

 

Note: Al de Molina, chief financial officer, will discuss third quarter results in a conference call at 10 a.m. (Eastern Time) today. The call can be accessed via a webcast available on the Bank of America Web site at http://www.bankofamerica.com/investor/.

 

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Page 10

 

Bank of America is one of the world’s largest financial institutions, serving individual consumers, small and middle market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk-management products and services. The company provides unmatched convenience in the United States, serving more than 38 million consumer and small business relationships with more than 5,800 retail banking offices, more than 16,700 ATMs and award-winning online banking with more than 14 million active users. Bank of America is the No. 1 overall Small Business Administration (SBA) lender in the United States and the No. 1 SBA lender to minority-owned small businesses. The company serves clients in 150 countries and has relationships with 97 percent of the U.S. Fortune 500 companies and 79 percent of the Global Fortune 500. Bank of America Corporation stock (NYSE: BAC) is listed on the New York Stock Exchange.

 

Forward-Looking Statements

 

This press release contains forward-looking statements, including statements about the financial conditions, results of operations and earnings outlook of Bank of America Corporation. The forward-looking statements involve certain risks and uncertainties. Factors that may cause actual results or earnings to differ materially from such forward-looking statements include, among others, the following: 1) projected business increases following process changes and other investments are lower than expected; 2) competitive pressure among financial services companies increases significantly; 3) general economic conditions are less favorable than expected; 4) political conditions including the threat of future terrorist activity and related actions by the United States abroad may adversely affect the company’s businesses and economic conditions as a whole; 5) changes in the interest rate environment reduce interest margins and impact funding sources; 6) changes in foreign exchange rates increases exposure; 7) changes in market rates and prices may adversely impact the value of financial products; 8) legislation or regulatory environments, requirements or changes adversely affect the businesses in which the company is engaged; 9) litigation liabilities, including costs, expenses, settlements and judgments, may adversely affect the company or its businesses; and 10) decisions to downsize, sell or close units or otherwise change the business mix of any of the company. For further information regarding Bank of America Corporation, please read the Bank of America reports filed with the SEC and available at www.sec.gov.

 

1 Lipper Inc. is an independent mutual fund performance monitor. Lipper ranks mutual funds’ total performance (assuming reinvestment of distributions) against other funds having similar investment objectives and strategies. Lipper makes no adjustment for the effect of sales loads.

 

2 45 Columbia Management funds had at least one share class earn an Overall Rating of 4 or 5 stars by Morningstar, Inc. for the period ended August 31, 2005. For each fund with at least a three-year history, Morningstar calculates a Morningstar Rating (tm) based on a Morningstar Risk-Adjusted Return measure. The top 10 percent of funds in each category receive five stars, the next 22.5 percent receive four stars. The Overall Morningstar Rating for a fund is derived from a weighted average of the performance figures associated with its three-, five- and ten-year (if applicable) Morningstar Rating metrics. Past performance is no guarantee of future performance.


Bank of America

Selected Financial Data

 

     Three Months
Ended September 30


    Nine Months
Ended September 30


 
     2005

    2004

    2005

    2004

 
(Dollars in millions, except per share data; shares in thousands)                         

Financial Summary

                                

Earnings

   $ 4,127     $ 3,764     $ 13,118     $ 10,294  

Earnings per common share

     1.03       0.93       3.27       2.80  

Diluted earnings per common share

     1.02       0.91       3.22       2.76  

Dividends paid per common share

     0.50       0.45       1.40       1.25  

Closing market price per common share

     42.10       43.33       42.10       43.33  

Average common shares issued and outstanding

     4,000,573       4,052,304       4,012,924       3,666,298  

Average diluted common shares issued and outstanding

     4,054,659       4,121,375       4,072,991       3,729,120  

Summary Income Statement

                                

Net interest income

   $ 7,773     $ 7,665     $ 23,296     $ 21,047  

Total noninterest income

     6,834       4,922       19,348       14,119  
    


 


 


 


Total revenue

     14,607       12,587       42,644       35,166  

Provision for credit losses

     1,159       650       2,614       2,063  

Gains on sales of debt securities

     29       732       1,013       2,022  

Other noninterest expense

     7,165       6,800       21,008       19,333  

Merger and restructuring charges

     120       221       353       346  
    


 


 


 


Income before income taxes

     6,192       5,648       19,682       15,446  

Income tax expense

     2,065       1,884       6,564       5,152  
    


 


 


 


Operating net income

     4,207       3,911       13,353       10,524  
    


 


 


 


Merger & Restructuring charges, net of tax

     80       147       235       230  
    


 


 


 


Net income

   $ 4,127     $ 3,764     $ 13,118     $ 10,294  
    


 


 


 


Summary Average Balance Sheet

                                

Total loans and leases

   $ 539,487     $ 503,078     $ 528,339     $ 458,268  

Securities

     225,952       169,515       219,314       143,119  

Total earning assets

     1,137,619       948,383       1,100,693       874,176  

Total assets

     1,294,745       1,096,683       1,258,050       1,008,434  

Total deposits

     632,771       587,878       633,614       531,958  

Shareholders’ equity

     100,454       96,392       99,234       79,510  

Common shareholders’ equity

     100,183       96,120       98,963       79,293  

Performance Ratios

                                

Return on average assets

     1.26 %     1.37 %     1.39 %     1.36 %

Return on average common shareholders’ equity

     16.33       15.56       17.70       17.32  

Credit Quality

                                

Net charge-offs

   $ 1,145     $ 719     $ 2,914     $ 2,268  

Annualized net charge-offs as a % of average loans and leases outstanding

     0.84 %     0.57 %     0.74 %     0.66 %

Managed credit card net losses as a % of average managed credit card receivables

     5.74       5.48       6,04       5.52  

 

     At September 30

 
     2005

    2004

 

Balance Sheet Highlights

                

Loans and leases

   $ 554,603     $ 511,639  

Total securities

     227,485       163,858  

Total earning assets

     1,091,680       927,161  

Total assets

     1,252,259       1,072,829  

Total deposits

     626,477       591,258  

Total shareholders’ equity

     101,258       98,011  

Common shareholders’ equity

     100,987       97,739  

Book value per share

     25.16       24.14  

Tangible equity ratio

     4.37 %     4.84 %

Risk-based capital ratios:

                

Tier 1

     8.21 *     8.08  

Total

     11.12 *     11.71  

Leverage ratio

     5.85 *     5.92  

Period-end common shares issued and outstanding

     4,013,063       4,049,063  

Allowance for credit losses:

                

Allowance for loan and lease losses

   $ 8,326     $ 8,723  

Reserve for unfunded lending commitments

     390       446  
    


 


Total

   $ 8,716     $ 9,169  
    


 


Allowance for loan and lease losses as a % of total loans and leases

     1.50 %     1.70 %

Allowance for loan and lease losses as a % of total nonperforming loans and leases

     556       343  

Total nonperforming loans and leases

   $ 1,498     $ 2,546  

Total nonperforming assets

     1,597       2,836  

Nonperforming assets as a % of:

                

Total assets

     0.13 %     0.26 %

Total loans, leases and foreclosed properties

     0.29       0.55  

Nonperforming loans and leases as a % of total loans and leases

     0.27       0.50  

Other Data

                

Full-time equivalent employees

     177,236       178,632  

Number of banking centers - domestic

     5,844       5,829  

Number of ATMs - domestic

     16,714       16,728  

 

 

Information for periods after April 1, 2004 includes the FleetBoston acquisition; prior periods have not been restated.


BUSINESS SEGMENT RESULTS

 

     Global
Consumer and
Small Business
Banking


    Global
Business and
Financial
Services


    Global
Capital Markets
and Investment
Banking


    Global
Wealth and
Investment
Management


    All
Other


 

Three Months Ended September 30, 2005

                                        

Total revenue (FTE) (2)

   $ 7,402     $ 2,854     $ 2,323     $ 1,835     $ 393  

Net income

     1,884       1,102       434       583       124  

Shareholder value added

     1,113       333       163       326       (305 )

Return on average equity

     22.81 %     15.13 %     16.90 %     23.23 %     n/m  

Average loans and leases

   $ 145,715     $ 183,937     $ 32,280     $ 55,175     $ 122,380  

Three Months Ended September 30, 2004

                                        

Total revenue (FTE) (2)

   $ 6,578     $ 2,519     $ 2,066     $ 1,605     $ (10 )

Net income

     1,503       1,190       471       476       124  

Shareholder value added

     731       400       185       236       (99 )

Return on average equity

     18.30 %     15.86 %     17.34 %     20.21 %     n/m  

Average loans and leases

   $ 134,201     $ 164,811     $ 35,370     $ 45,654     $ 123,041  

Nine Months Ended September 30, 2005

                                        

Total revenue (FTE) (2)

   $ 21,447     $ 8,260     $ 7,063     $ 5,465     $ 999  

Net income

     5,394       3,427       1,613       1,752       932  

Shareholder value added

     3,108       1,127       808       985       (204 )

Return on average equity

     21.94 %     15.71 %     21.11 %     23.42 %     n/m  

Average loans and leases

   $ 142,260     $ 177,264     $ 32,865     $ 52,983     $ 122,967  

Nine Months Ended September 30, 2004

                                        

Total revenue (FTE) (2)

   $ 18,035     $ 6,533     $ 6,852     $ 4,252     $ 4  

Net income

     4,361       2,629       1,335       1,122       847  

Shareholder value added

     2,517       874       570       527       (39 )

Return on average equity

     22.40 %     15.77 %     18.45 %     19.33 %     n/m  

Average loans and leases

   $ 116,822     $ 146,347     $ 33,889     $ 42,749     $ 118,461  

 

n/m = not meaningful

 

     Three Months Ended
September 30


   

Nine Months Ended

September 30


 
     2005

    2004

    2005

    2004

 

SUPPLEMENTAL FINANCIAL DATA

                                

Fully taxable-equivalent basis data (2)

                                

Net interest income

   $ 7,973     $ 7,836     $ 23,886     $ 21,557  

Total revenue

     14,807       12,758       43,234       35,676  

Net interest yield

     2.80 %     3.30 %     2.90 %     3.29 %

Efficiency ratio

     49.20       55.03       49.41       55.16  

Reconciliation of net income to operating earnings

                                

Net income

   $ 4,127     $ 3,764     $ 13,118     $ 10,294  

Merger and restructuring charges

     120       221       353       346  

Related income tax benefit

     (40 )     (74 )     (118 )     (116 )
    


 


 


 


Operating earnings

   $ 4,207     $ 3,911     $ 13,353     $ 10,524  
    


 


 


 


Operating Basis

                                

Diluted earnings per common share

   $ 1.04     $ 0.95     $ 3.28     $ 2.82  

Return on average assets

     1.29 %     1.42 %     1.42 %     1.39 %

Return on average common shareholders’ equity

     16.64       16.17       18.02       17.71  

Efficiency ratio

     48.39       53.30       48.59       54.19  

Reconciliation of net income to shareholder value added

                                

Net income

   $ 4,127     $ 3,764     $ 13,118     $ 10,294  

Amortization of intangibles

     201       200       613       455  

Merger and restructuring charges, net of tax benefit

     80       147       235       230  

Capital charge

     (2,778 )     (2,658 )     (8,142 )     (6,530 )
    


 


 


 


Shareholder value added

   $ 1,630     $ 1,453     $ 5,824     $ 4,449  
    


 


 


 


 

(1) Certain prior period amounts have been reclassified to conform to current period presentation.

 

(2) Fully taxable-equivalent (FTE) basis is a performance measure used by management in operating the business that management believes provides investors with a more accurate picture of the interest margin for comparative purposes.

 

Information for periods after April 1, 2004 includes the FleetBoston acquisition; prior periods have not been restated.