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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE

SECURITIES EXCHANGE ACT OF 1934

(AMENDMENT NO.    )

Filed by the Registrant  x

Filed by a Party other than the Registrant  ¨

Check the appropriate box:

Bank of America Corporation

(Name of Registrant as Specified in its Charter)

PAYMENT OF FILING FEE (Check the appropriate box):

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March 19, 2007

Dear Stockholder:

I am pleased to invite you to the Bank of America Corporation 2007 Annual Meeting of Stockholders. The meeting will be held at 10:00 a.m., local time, on April 25, 2007, in the Belk Theater of the North Carolina Blumenthal Performing Arts Center, 130 North Tryon Street, Charlotte, North Carolina. If you are unable to attend, you will be able to listen to the meeting and view our slide presentation over the Internet at http://investor.bankofamerica.com.

Enclosed are a notice of matters to be voted on at the meeting, our proxy statement, a proxy card and our 2006 Annual Report.

Whether or not you plan to attend, please grant a proxy to vote your shares in one of three ways: via Internet, telephone or mail. Instructions regarding Internet and telephone voting are included on the proxy card (or, if applicable, in your electronic delivery notice). If you choose to vote by mail, please mark, sign and date the proxy card and return it in the enclosed postage-paid envelope. Your proxy may be revoked at any time before it is exercised as explained in the proxy statement.

If you plan to attend, please bring the admission ticket attached to your proxy card and photo identification. Also, if your shares are held in the name of a broker or other nominee, please bring with you a proxy or letter from the broker or nominee confirming your ownership as of the record date.

Sincerely yours,

Kenneth D. Lewis

Chairman, Chief Executive Officer and President

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BANK OF AMERICA CORPORATION

Bank of America Corporate Center

Charlotte, North Carolina 28255

NOTICE OF 2007 ANNUAL MEETING OF STOCKHOLDERS

Webcast of the Annual Meeting: You may listen to a live audiocast of the meeting on our website at http://investor.bankofamerica.com at 10:00 a.m., local time, on April 25, 2007.

Items of Business:

Record Date: You can vote if you were a stockholder of record on March 2, 2007. In accordance with Delaware law, for 10 days prior to the Annual Meeting, a list of those registered stockholders entitled to vote at the Annual Meeting will be available for inspection in the office of the Corporate Secretary, Bank of America Corporation, Bank of America Corporate Center, Charlotte, North Carolina. Such list also will be available at the Annual Meeting.

Proxy Voting: Your vote is important. Please vote your shares as soon as possible via either the Internet, telephone or mail.

By order of the Board of Directors:

William J. Mostyn III

Deputy General Counsel

and Corporate Secretary

March 19, 2007

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BANK OF AMERICA CORPORATION

Bank of America Corporate Center

Charlotte, North Carolina 28255

PROXY STATEMENT

We are providing these proxy materials in connection with the solicitation of proxies by the Board of Directors of Bank of America Corporation for the 2007 Annual Meeting of Stockholders (the “Annual Meeting”). In this proxy statement, we refer to the Board of Directors as the “Board” and to Bank of America Corporation as “we”, “us”, “Bank of America” or the “Corporation.” This proxy statement is being mailed starting on or about March 19, 2007.

GENERAL INFORMATION

Record Date. Only holders of record at the close of business on March 2, 2007 will be entitled to vote at the Annual Meeting. Holders of the Corporation’s Common Stock (the “Common Stock”) and 7% Cumulative Redeemable Preferred Stock, Series B (the “Series B Stock”), vote together without regard to class.

As of the record date of March 2, 2007, there were 4,459,009,892 shares of Common Stock, and 7,739 shares of Series B Stock entitled to vote at the Annual Meeting. Each share of Common Stock and Series B Stock is entitled to one vote.

Voting Your Proxy. Whether or not you plan to attend the Annual Meeting, you may grant a proxy to vote your shares via Internet, telephone or mail as more fully described below:

If you properly submit a proxy without giving specific voting instructions, your shares will be voted in accordance with the Board’s recommendations as follows:

“FOR:”

and “AGAINST:”

If other matters properly come before the Annual Meeting, the persons appointed to vote the proxies will vote on such matters in accordance with their best judgment. Such persons also have discretionary authority to vote to adjourn the Annual Meeting, including for the purpose of soliciting proxies to vote in accordance with the Board’s recommendations on any of the above items.

Revoking Your Proxy. You may revoke your proxy at any time before it is exercised by:

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Cost of Proxy Solicitation. We will pay the cost of soliciting proxies. In addition to soliciting proxies by mail or electronic delivery, we also may use some of our regular associates, who will not be specially compensated, to solicit proxies, either personally or by telephone, facsimile or written or electronic mail. In addition, we have agreed to pay Georgeson Inc. $17,000 plus expenses to assist us in soliciting proxies from banks, brokers and nominees. We also will reimburse banks, brokers and other nominees for their expenses in sending proxy materials to their customers who are beneficial owners.

Votes Required to Hold the Annual Meeting. In order to hold the Annual Meeting, a majority of the aggregate voting power of the Common Stock and Series B Stock must be present in person or represented by proxy at the Annual Meeting. For purposes of determining the presence or absence of a quorum, we intend to count as present shares present in person but not voting and shares for which we have received proxies but for which holders thereof have abstained. Furthermore, shares represented by proxies returned by a broker holding such shares in nominee or “street” name will be counted as present for purposes of determining whether a quorum exists, even if such shares are not voted on matters where discretionary voting by the broker is not allowed (“broker non-votes”).

Majority Vote Standard for Election of Directors. In October 2006, the Board amended our Bylaws to provide that a nominee for director in an uncontested election shall be elected to the Board if the votes represented by the aggregate of all of the shares of Common Stock and Series B Stock cast for such nominee’s election exceed the votes cast against his or her election. Abstentions from voting, as well as broker non-votes, if any, are not treated as votes cast and, therefore, will have no effect on the proposal to elect directors. In a contested election (a situation in which the number of nominees exceeds the number of directors to be elected), the standard for election of directors will be a plurality of the votes cast at the meeting. This Bylaw may be amended or repealed only with the approval of our stockholders.

If a nominee who is currently serving as a director is not elected at the Annual Meeting, under Delaware law the director will continue to serve on the Board as a “holdover director.” However, under our Corporate Governance Guidelines, any director who fails to be elected must offer to resign from the Board. The director whose resignation is under consideration will abstain from participating in any decision regarding that resignation. The Corporate Governance Committee and the Board may consider any factors they deem relevant in deciding whether to accept a director’s resignation. The Board will publicly disclose its decision regarding the resignation within 90 days after results of the election are certified. If the resignation is not accepted, the director will continue to serve until the next annual meeting and until the director’s successor is elected and qualified. If a nominee who is not already serving as a director is not elected at the Annual Meeting, under Delaware law that nominee will not become a director and will not serve on the Board as a “holdover director.”

In future director elections, the Board will nominate for re-election only candidates who have tendered irrevocable resignations that will be effective upon: i) the failure to receive the required vote at the next annual meeting at which they are nominated for re-election; and ii) Board acceptance of such resignation. In addition, the Board will fill director vacancies and new directorships only with candidates who agree to tender, promptly following their appointment to the Board, the same form of irrevocable resignation.

Votes Required to Adopt Other Proposals. Approval of each of the other proposals requires the affirmative vote of a majority of the votes represented by the aggregate of all of the shares of Common Stock and Series B Stock cast with respect to each such matter. Abstentions from voting, as well as broker non-votes, if any, are not treated as votes cast and, therefore, will have no effect on any such proposal.

Voting by Associates. If you participate in The Bank of America 401(k) Plan or The Bank of America 401(k) Plan for Legacy Fleet and MBNA and your account has investments in shares of Common Stock, you must provide voting instructions to the plan trustees (either via the proxy card or by Internet or telephone) in order for your shares to be voted as you instruct. If no voting instructions are received, your shares will not be voted. Your voting instructions will be held in strict confidence.

Householding. Unless we have received contrary instructions, we send a single copy of the annual report, proxy statement and notice of annual or special meeting to any household at which two or more stockholders reside if we believe the stockholders are members of the same family. Each stockholder in the household will continue to receive a separate proxy card. This process, known as “householding,” reduces the volume of duplicate information received at your household and helps reduce our expenses.

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If you would like to receive your own set of our annual disclosure documents this year or in future years, follow the instructions described below.

If your shares are registered in your own name, please contact our transfer agent and inform them of your request to revoke householding by calling them at 1.800.642.9855 or writing to them at Computershare Trust Company, N.A., P.O. Box 43078, Providence, Rhode Island 02940-3078. Within 30 days of your revocation, we will send individual documents.

If a bank, broker or other nominee holds your shares, please contact your bank, broker or other nominee directly.

Electronic Delivery. In addition to householding, we can also reduce our expenses if you elect to receive your annual reports and proxy materials via the Internet. If you request, you can receive email notifications when these documents are available electronically on the Internet. If you have an account maintained in your name at Computershare Investor Services, you may sign up for this service at www.computershare.com/bac.

Questions. If you hold your shares directly, please call Computershare Trust Company at 1.800.642.9855. If your shares are held in street name, please contact the telephone number provided on your voting instruction form or contact your broker directly.

CORPORATE GOVERNANCE

Commitment to Corporate Governance Best Practices

Bank of America’s business and affairs are managed by or under the direction of the Board. In its oversight of Bank of America, the Board sets the tone for the highest ethical standards and performance of our management, associates and company as a whole. The Board strongly believes that good corporate governance practices lead to successful business performance. Our corporate governance practices are designed to align the interests of the Board and management with those of our stockholders and to promote honesty and integrity throughout Bank of America. Over the past several years, we have enhanced our corporate governance practices in many important ways, and we continually seek out best practices to promote a high level of performance from the Board and management. The Board has adopted Corporate Governance Guidelines that embody long-standing practices of Bank of America as well as current corporate governance best practices. Highlights of our corporate governance practices are described below.

Corporate Governance Principles, Committee Charters and Code of Ethics

More information about corporate governance may be found on our website at http://investor.bankofamerica.com under the heading Corporate Governance. Information available at this website includes: (i) our Corporate Governance Guidelines; (ii) our Code of Ethics; (iii) the charters of each of the committees of the Board; and (iv) our Director Independence Categorical Standards. This information is also available in print free of charge upon written request addressed to: Bank of America Corporation, Attention: Shareholder Relations, 101 South Tryon Street, NC1-002-29-01, Charlotte, North Carolina 28255.

The Board of Directors

The basic responsibility of the Board is to oversee the businesses and affairs of Bank of America. Key responsibilities of the Board and its committees include:

Board Evaluation and Education

Each year, the Board and each of its committees evaluate their effectiveness. The Board views self-evaluation as an ongoing process designed to achieve high levels of Board and committee performance.

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All new directors participate in our orientation program in their first year as a director. This orientation includes presentations by senior management to familiarize new directors with our strategic plans, significant financial, accounting and risk management issues, compliance programs, conflict policies, Code of Ethics and other policies. The Board also encourages directors to participate in continuing education programs and reimburses directors for the expenses of such participation.

Director Independence

The Board is composed at all times of at least a majority of directors who are independent. As described below, the Board has determined that 13 of the Board’s 17 director nominees, or approximately 76%, are independent directors. The Board has adopted categorical standards to assist it in making the annual affirmative determination of each director’s independence status. These Director Independence Categorical Standards are posted on our website. A director will be considered “independent” if he or she meets the requirements of the categorical standards and the criteria for independence set forth from time to time in the listing standards of the New York Stock Exchange (“NYSE”).

The Board has evaluated the relationships between each current director (and his or her immediate family members and related interests) and Bank of America and its subsidiaries. The Board has affirmatively determined, upon the recommendation of the Corporate Governance Committee, that each of the following directors is independent under the Director Independence Categorical Standards and the NYSE listing standards: William Barnet, III, John T. Collins, Gary L. Countryman, Tommy R. Franks, Paul Fulton, W. Steven Jones, Monica C. Lozano, Walter E. Massey, Thomas J. May, Patricia E. Mitchell, Thomas M. Ryan, O. Temple Sloan, Jr., Meredith R. Spangler and Jackie M. Ward. The Board has determined that Frank P. Bramble, Sr., Charles K. Gifford, Kenneth D. Lewis and Robert L. Tillman do not meet the independence standards. Mr. Bramble and Mr. Gifford were employed by Bank of America or a predecessor within a three-year period. Mr. Tillman was the Chief Executive Officer and Chairman of the Board of Lowe’s Companies, Inc. (“Lowe’s”) while Mr. Lewis served on Lowe’s Compensation Committee. Mr. Lewis resigned from the Lowe’s board in 2004.

The Board also has evaluated the relationships between Bank of America and its subsidiaries and Charles W. Coker and Edward L. Romero (and their immediate family members and related interests), each of whom retired from the Board in April 2006. In early 2006, the Board affirmatively determined, upon the recommendation of the Corporate Governance Committee, that Mr. Coker and Mr. Romero were independent under the Director Independence Categorical Standards and the NYSE listing standards.

In making its independence determinations, the Board considered that in the ordinary course of business the Corporation and its subsidiaries may provide commercial and investment banking, financial advisory and other services to some of the independent directors and to business organizations and individuals associated with them. The Board also considered that in the ordinary course of business some business organizations with which an independent director is associated may provide products and services to the Corporation and its subsidiaries. The Board has determined that, based on the information available to the Board, none of these relationships was material.

Board Attendance and Annual Meeting Policy

Directors are expected to attend our annual meeting of stockholders, board meetings and meetings of the committees on which they serve. They are also expected to prepare for meetings in advance and to dedicate the time at each meeting as necessary to properly discharge their responsibilities. Informational materials, useful in preparing for meetings, are distributed in advance of each meeting. In 2006, there were eight meetings of the Board, and each of the directors attended at least 75% of the meetings of the Board and committees on which he or she served. In addition, all of the members of the Board, consistent with our policy, attended our 2006 Annual Meeting of Stockholders.

Lead Director

In April 2006, the Board amended our Corporate Governance Guidelines to provide for an independent Lead Director. At that time Mr. Sloan was elected by the independent directors to serve as Lead Director for a one-year term.

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The Lead Director chairs meetings of the non-management directors, approves board meeting agendas, has the authority to call meetings of the independent directors and serves as a liaison with the Chairman and Chief Executive Officer. The Lead Director also provides an important communications link between the other independent directors and our stockholders.

Executive Sessions of the Board

Our non-management directors meet in executive session at each Board meeting. Our Lead Director chairs these executive sessions. In addition, if at any time the group of non-management directors includes directors who are not independent under the NYSE listing standards and our Director Independence Categorical Standards, the independent directors will meet alone in executive session at least once a year.

Board Committee Membership and Meetings

During 2006, the Board had five standing committees: Asset Quality, Audit, Compensation, Corporate Governance and Executive. All of the members of the committees are nominated by the Corporate Governance Committee and appointed by the Board.

The table below provides membership information for each of the Board’s committees.

2006/2007 Bank of America Committee Composition

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In addition, the Board has made, subject to election of the director nominees by the stockholders at the Annual Meeting, the following committee assignments to be effective as of the Annual Meeting:

2007/2008 Bank of America Committee Composition

While each committee has its own charter and designated responsibilities, the committees act on behalf of the entire Board and regularly report on their activities to the entire Board. The committee charters are posted on our website and key information about each committee is described below.

Asset Quality Committee. The Asset Quality Committee currently consists of six directors. During 2006, the Committee held six meetings. Duties of the Asset Quality Committee include:

Audit Committee. The Audit Committee currently consists of five directors, all of whom are independent under the NYSE listing standards, the Director Independence Categorical Standards and other Securities and Exchange Commission (“SEC”) rules and regulations applicable to audit committees. The Board has determined that Mr. Barnet and Mr. May qualify as Audit Committee Financial Experts. During 2006, the Audit Committee held thirteen meetings. Duties of the Audit Committee include the following:

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Compensation Committee. The Compensation Committee currently consists of four directors, all of whom are independent under the NYSE listing standards and our Director Independence Categorical Standards. During 2006 the Compensation Committee held six meetings. Duties of the Committee include:

The Committee may create subcommittees with authority to act on the Committee’s behalf. The Committee has delegated to the Stock Plan Award Subcommittee (which consists of the Chairman of the Committee) the Committee’s authority to make awards and determine the terms and conditions of stock options, stock appreciation rights and restricted stock awards (both shares and units) under the Bank of America Corporation 2003 Key Associate Stock Plan (the “Key Associate Stock Plan”) that was most recently approved by stockholders in April 2006. However, this delegation of authority does not extend to awards to our executive officers.

The Committee may delegate to management certain of its duties and responsibilities, including with respect to the adoption, amendment, modification or termination of benefit plans and with respect to the awards of stock options under certain stock plans. Significant delegations made by the Committee include the following:

The Committee actively engages in its duties and follows procedures intended to ensure excellence in the governance of our pay-for-performance mandate:

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The form and amount of compensation paid to our non-employee directors is reviewed from time to time by the Committee. Competitive data is provided to the Committee by its compensation consultant using the same competitor groups that are used in making compensation decisions for our executive officers. Any changes to non-employee director compensation are recommended by the Committee to the Board for approval.

Our executive officers are not engaged directly with the Committee in setting the amount or form of executive officer or director compensation. However, as part of the annual performance review for our executive officers other than the Chief Executive Officer, the Committee considers the Chief Executive Officer’s perspective on each executive officer’s individual performance as well as the performance of our various lines of business.

We operate a large company in a dynamic, competitive global environment, and the Committee has responsibility for our global compensation and benefit programs that support this business. To perform its duties, the Committee requires assistance from a compensation consultant who has broad skills and experience, including experience with global compensation and benefits programs, and who has sufficient resources to meet our needs. The Committee has the sole authority and responsibility under its charter to approve the engagement of any such compensation consultant.

In addition to possessing the necessary skill, experience and resources to meet our needs, the consultant must have no relationship with us that would interfere with its ability to provide independent advice. The Committee reviews any relationships between management and the consultant, as well as the amount of work performed for us by the consultant in areas other than executive officer and director compensation. Given that there are a limited number of compensation consultants with the broad skills, experience and resources necessary to support a company of our size and global scope, the Committee believes that its compensation consultant may have other relationships with us, so long as those relationships do not interfere with its ability to provide independent advice. If the compensation consultant provides services to us other than in connection with the evaluation of director, chief executive officer or senior executive compensation and benefits, the Committee will approve the annual amount of aggregate fees permitted for such other services.

Mercer Human Resource Consulting served as the compensation consultant for the Committee for the last several years. In October 2006, the Committee hired Towers Perrin. While the Committee highly valued Mercer’s services, the change in consultants was a result of the Committee’s continuing review of its needs and the exercise of its discretion.

Towers Perrin provides other services to us in the areas of global retirement and healthcare benefits, for which the Committee has oversight responsibility. Towers Perrin also provides a small amount of services to us in other areas. The Committee took these services into account when it retained Towers Perrin to serve as its compensation consultant and concluded that these other relationships with us would not interfere with Towers Perrin’s ability to provide independent advice. The Committee has approved an annual amount of aggregate fees for Towers Perrin for all services, and at least annually the Committee will review the services performed by, and the actual fees paid to, the firm.

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Corporate Governance Committee. The Corporate Governance Committee currently consists of four directors, all of whom are independent under the NYSE listing standards and the Director Independence Categorical Standards. During 2006, the Corporate Governance Committee held four meetings. Duties of the Corporate Governance Committee include:

Executive Committee. The Executive Committee currently consists of five directors. During 2006, the Executive Committee held three meetings although it has only one regularly scheduled meeting per year. The Executive Committee has the power to act on behalf of the Board between regular Board meetings. The Executive Committee reports its actions to the full Board at the next succeeding meeting.

Identifying and Evaluating Nominees for Director

The Corporate Governance Committee is responsible for evaluating candidates and recommending proposed director nominees to the Board. The Corporate Governance Committee will consider candidates proposed or suggested by Board members, management, third party search firms retained by the Corporate Governance Committee and stockholders. The Corporate Governance Committee follows the same process and uses the same criteria for evaluating candidates whether proposed by Board members, management, third party search firms or stockholders.

Our Corporate Governance Guidelines set forth the standards for evaluating candidates as director nominees. The Corporate Governance Committee and the Board consider the overall experience and expertise represented by the Board as well as the qualification of each candidate. Specifically, the standards for evaluating candidates are as follows:

In addition, a director who has reached the age of 72 will not be nominated for election to the Board. A director who changes his or her principal occupation shall offer to resign, and the Corporate Governance Committee, along with the Chairman of the Board, will determine whether to accept such resignation. Management directors will resign from the Board when they leave their officer positions.

Any stockholder recommending a candidate to be considered by the Corporate Governance Committee for nomination at an annual meeting of stockholders must submit the proposal in writing by no later than the 75^th day nor

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earlier than the 120^th day prior to the first anniversary of the date we began mailing our proxy materials for the preceding year’s annual meeting. However, if the date of the annual meeting is more than 30 days before or more than 70 days after its anniversary date, the proposal must be submitted in writing by no later than the 75^th day nor earlier than the 120^th day prior to such annual meeting or the tenth day following the day on which we first publicly announce the date of such meeting. The proposal must include the following:

In October 2006, our Corporate Governance Guidelines were amended to provide that the Board shall nominate for election or re-election as directors only candidates who agree to tender, following the annual meeting at which they are elected or re-elected as directors, irrevocable resignations that will be effective upon: (i) the failure to receive the required vote at the next annual meeting at which they are nominated for re-election; and (ii) Board acceptance of such resignation. In addition, the Board shall fill director vacancies and new directorships only with candidates who agree to tender, promptly following their appointment to the Board, the same form of irrevocable resignation tendered by other directors in accordance with our Corporate Governance Guidelines.

Communications with the Board of Directors

The Board has established a process for stockholders and other interested parties to communicate with non-management members of the Board or a specific committee. Parties may send a letter to Bank of America Corporation, Attention: Corporate Secretary, 101 South Tryon Street, NC1-002-29-01, Charlotte, North Carolina 28255.

Code of Ethics

The Board has adopted a Code of Ethics that applies to all of our directors, officers and associates, including our principal executive officer, principal financial officer and principal accounting officer. The Code of Ethics embodies our commitment to the highest standards of ethical and professional conduct. All directors, officers and associates are required to annually certify that they have read and complied with the Code of Ethics. The Code of Ethics consists of basic standards of business practice as well as professional and personal conduct. We intend to post any amendments to, or waivers of, the Code of Ethics (to the extent applicable to the principal executive officer, principal financial officer or principal accounting officer) on our website.

Charitable Giving and Political Contributions

The Board annually reviews a report on our charitable giving and political contribution programs. Information regarding our policy on political contributions and activities can be found in our “Corporate Political Contributions Policy Statement”, which is posted on our website.

Director Compensation

Mr. Lewis is our sole employee director, and he does not receive any compensation from us for his services as a director. We provide the following elements of compensation for our non-employee directors:

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Effective with the 2006 Annual Meeting, we discontinued paying meeting fees to our non-employee directors.

The annual restricted stock award is provided under the Bank of America Corporation Directors’ Stock Plan (the “Directors’ Stock Plan”) and is subject to a one-year vesting requirement. The number of shares awarded equals the dollar value of the award divided by the closing price of our Common Stock on the grant date, rounded down to the next whole share, with cash payable for any fractional share.

Non-employee directors can elect to defer all or any portion of their compensation through the Bank of America Corporation Director Deferral Plan (the “Director Deferral Plan”). If a director elects to defer any portion of the annual restricted stock award, we credit a “stock account” with a number of whole and fractional “stock units” of equal value, with each stock unit having the same value as our Common Stock. These stock units are subject to the same one-year vesting requirement that applies under the Directors’ Stock Plan. Directors can choose to have their annual cash award, as well as any Lead Director or chairman annual retainer, deferred either into the stock account or a “cash account.” We credit the stock account with dividend equivalents in the form of additional stock units and credit the cash account with interest at a long-term bond rate. Following retirement from the Board, a non-employee director receives the balances of his or her stock account (to the extent vested) and cash account in a single lump sum cash payment or in 5 or 10 annual cash installments per the director’s prior election. Because stock units are not actual shares of our Common Stock, they do not have any voting rights.

The following table presents the compensation we paid, accrued or expensed with respect to our non-employee directors for their services in 2006:

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This column does not include any such cash awards that were deferred under the Director Deferral Plan into a director’s stock account. Those amounts are instead reflected in the “Stock Awards” column.

For Mr. Bramble and General Franks, the amount also includes a pro rata cash award paid in 2006 for service on the Board prior to the 2006 Annual Meeting. For Mr. Bramble, this pro rata award reflects his January 1, 2006 appointment date, and for General Franks his January 25, 2006 appointment date.

For Mr. Bramble and General Franks, the amount also includes the grant date fair value of a pro rata award made in 2006 for service on the Board prior to the 2006 Annual Meeting. For Mr. Bramble, this pro rata award had a $37,970 grant date fair value and reflects his January 1, 2006 appointment date, and for General Franks a $30,041 grant date fair value and reflects his January 25, 2006 appointment date.

As of December 31, 2006, our non-employee directors held the following number of unexercised stock options and the following number of unvested shares of restricted stock or unvested stock units:

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In consideration for his consulting services and other agreements, Mr. Gifford receives: (i) a $50,000 retainer for each of the first five years of the agreement; (ii) use of company-provided aircraft for up to 120 hours per year for each of the first five years of the agreement and up to 100 hours per year for any additional year the agreement remains in effect thereafter; and (iii) office space (for as long as he requests) and secretarial support (for the first five years of the agreement, renewable annually thereafter) that is both reasonable and appropriate in size and scope.

For 2006, the value of these benefits equaled the following: (i) $50,000 in consulting fees; (ii) $723,699 in aircraft usage (which is the amount paid to a third party vendor); (iii) $212,954 in office and administrative support; and (iv) $3,790 in tax preparation services. In addition, we paid Mr. Gifford a tax gross-up in the amount of $151,705 related to his use of company-provided aircraft. We did this because in 2006 we began imputing income for personal use of company-provided aircraft using a third-party “charter” value, rather than the more common IRS-approved Standard Industry Fare Level (SIFL). By changing to the charter value, we made it more expensive for our executive officers to use company-provided aircraft for personal travel. However, this change also made the aircraft usage for Mr. Gifford more expensive, which was not the intent when the Retirement Agreement was originally entered into. The tax gross-up represents the difference in the taxes Mr. Gifford is required to pay using charter values versus what he would have had to pay had we continued using SIFL values.

Upon his retirement as an associate, Mr. Gifford became entitled to receive compensation as a non-employee director as more fully described above.

Stock Ownership Guidelines for Directors. We have formal stock ownership guidelines that apply to our non-employee directors. Under these guidelines, each non-employee director is required to own and hold a minimum of 10,000 shares of our Common Stock. All full value shares beneficially owned are included in the calculation. New non-employee directors have up to five years to achieve compliance. Non-employee directors cannot sell the restricted stock they receive as compensation (except as necessary to pay taxes upon vesting) until termination of their service.

ITEM 1: ELECTION OF DIRECTORS

The Board has nominated each of the following individuals for election at the Annual Meeting. Each director elected will serve until the next annual meeting of stockholders when his or her successor has been elected and qualified, or until the director’s earlier resignation or removal. If any nominee is unable to stand for election for any reason, the persons appointed to vote the proxies may vote at the Annual Meeting for another person proposed by the Board, or the number of directors constituting the Board may be reduced.

If a nominee who is currently serving as a director is not elected at the Annual Meeting, under Delaware law the director will continue to serve on the Board as a “holdover director.” However, under our Corporate Governance Guidelines, any director who fails to be elected must offer to resign from the Board. The director whose resignation is under consideration will abstain from participating in any decision regarding that resignation. The Corporate Governance Committee and the Board may consider any factors they deem relevant in deciding whether to accept a director’s resignation. The Board will publicly disclose its decision regarding the resignation within 90

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days after results of the election are certified. If the resignation is not accepted, the director will continue to serve until the next annual meeting and until the director’s successor is elected and qualified. If a nominee who is not already serving as a director is not elected at the Annual Meeting, under Delaware law that nominee will not become a director and will not serve on the Board as a “holdover director.”

The Nominees

Set forth below are each nominee’s name, principal occupation and five year business history.

The Board recommends a vote “FOR” all of the nominees listed below for election as directors (Item 1 on the proxy card).

		WILLIAM BARNET, III (64), Chairman, President and Chief Executive Officer, The Barnet Company, Spartanburg, South Carolina, a real estate and other investments firm. He has been in his present position since 2001 and has been President of Barnet Development Corporation, a real estate investment firm, since 1990. He has also served as Chairman of William Barnet & Son, LLC, a synthetic fiber processing company, from 2001 to 2006, and served as Chief Executive Officer from 2000 to 2001. He served as President and Chief Executive Officer of William Barnet & Son, Inc. from 1976 to 2000. He has been the Mayor of Spartanburg, South Carolina since 2002. He has been a director of the Corporation since April 2004 and is a member of the Audit Committee. He also serves as a director of Duke Energy Corporation.
		FRANK P. BRAMBLE, SR. (58), Former Executive Officer, MBNA Corporation, Wilmington, Delaware. He served as an advisor to the Executive Committee of MBNA Corporation, a financial services company, from April 2005 to December 2005 when it was acquired by the Corporation. Prior to that time, he had served as Vice Chairman of MBNA from July 2002 to April 2005. He also served as a director of Allfirst Financial, Inc. and Allfirst Bank from April 1994 to May 2002, and from December 1999 to May 2002 as Chairman of the Board. He has been a director of the Corporation since January 2006 and is a member of the Asset Quality Committee.
		JOHN T. COLLINS (60), Chief Executive Officer, The Collins Group, Inc., Boston, Massachusetts, a venture capital, private equity investments and management firm. He has been in his present position since 1995. He has been a director of the Corporation since April 2004 and is a member of the Audit Committee.
		GARY L. COUNTRYMAN (67), Chairman Emeritus, Liberty Mutual Group, Boston, Massachusetts, a financial services company. He served as Chairman of Liberty Mutual Group from 1986 to 2000. He also served as Chief Executive Officer from 1986 to 1998. He has been a director of the Corporation since April 2004 and is a member of the Executive Committee. He also serves as a director of NSTAR.
		TOMMY R. FRANKS (61), Retired General, United States Army, Roosevelt, Oklahoma. General Franks has operated Franks & Associates, LLC, a private consulting firm, since 2003. He served in the United States Army from 1965 to 2003. In August 2003, he retired as a four star general. He has been a director of the Corporation since January 2006 and is a member of the Audit Committee. He also serves as a director of OSI Restaurant Partners, Inc.

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		CHARLES K. GIFFORD (64), Former Chairman, Bank of America Corporation, Charlotte, North Carolina. He served as Chairman of the Corporation from April 2004 until January 2005. Prior to that time, he had served as Chairman and Chief Executive Officer of FleetBoston since 2002. He also served as President and Chief Executive Officer of FleetBoston from 2001 to 2002 and President and Chief Operating Officer from 1999 to 2001. He has been a director of the Corporation since April 2004 and is a member of the Executive Committee. He also serves as a director of NSTAR and CBS Corporation.
		W. STEVEN JONES (55), Dean, Kenan-Flagler Business School University of North Carolina at Chapel Hill, Chapel Hill, North Carolina. He has been in his present position since August 2003. From January 1997 to September 2002, he served as Chief Executive Officer and Managing Director of Suncorp-Metway Ltd., an Australian banking, insurance and funds management company. He has been a director of the Corporation since April 2005 and is a member of the Asset Quality Committee. He also serves as a director of Progress Energy, Inc.
		KENNETH D. LEWIS (59), Chairman, Chief Executive Officer and President, Bank of America Corporation, Charlotte, North Carolina. He has served as Chief Executive Officer since April 2001, President since July 2004 and Chairman since February 2005. He previously served as Chairman from April 2001 to April 2004 and President from January 1999 to April 2004. He also served as Chief Operating Officer from October 1999 to April 2001. He also serves as Chairman, Chief Executive Officer, President and a director of Bank of America, N.A. He has been a director of the Corporation since 1999 and is a member of the Executive Committee.
		MONICA C. LOZANO (50), Publisher and Chief Executive Officer of La Opinion, Los Angeles, California, the largest Spanish-language newspaper in the United States. She has been in her present position since January 2004. In addition, she has served as Senior Vice President of ImpreMedia, LLC, the parent of La Opinion, since January 2004. From 2000 to 2004, Ms. Lozano served as President and Chief Operating Officer of Lozano Enterprises. She has been a director of the Corporation since April 2006 and is a member of the Asset Quality Committee. She also serves as a director of The Walt Disney Company.
		WALTER E. MASSEY (68), President, Morehouse College, Atlanta, Georgia. He has been in his present position since 1995. He has been a director of the Corporation since 1998 and is a member of the Audit Committee. He also serves as a director of BP p.l.c. and McDonald’s Corporation.
		THOMAS J. MAY (59), Chairman, President and Chief Executive Officer, NSTAR, Boston, Massachusetts, an energy utility company. He has served as President of NSTAR and its subsidiaries since 2002 and as Chairman and Chief Executive Officer since 1999. He has been a director of the Corporation since April 2004 and is chair of the Audit Committee.

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		PATRICIA E. MITCHELL (64), President and Chief Executive Officer, The Museum of Television and Radio, New York, New York. She has served in her present position since March 2006. Prior to that time, she had served as President and Chief Executive Officer of Public Broadcasting Service from March 2000 to March 2006. She also had served as President of CNN Productions and Time Inc. Television, a division of Time Warner, Inc. She has been a director of the Corporation since 2001 and is a member of the Asset Quality Committee.
		THOMAS M. RYAN (54), Chairman, President and Chief Executive Officer, CVS Corporation, Woonsocket, Rhode Island, an operator of retail pharmacies. He has served as President and Chief Executive Officer since May 1998 and as Chairman since April 1999. He has been a director of the Corporation since April 2004 and is chair of the Corporate Governance Committee and a member of the Compensation Committee. He also serves as a director of Yum! Brands, Inc.
		O. TEMPLE SLOAN, JR. (68), Chairman, General Parts International, Inc., Raleigh, North Carolina, a distributor of automotive replacement parts. He has been a director of the Corporation since 1996. He is the Corporation’s Lead Director and is chair of the Executive Committee and a member of the Compensation and Corporate Governance Committees. He also serves as Chairman of the Board of Highwoods Properties, Inc. and as a director of Golden Corral and Lowe’s Companies, Inc.
		MEREDITH R. SPANGLER (69), Trustee and Board Member, Charlotte, North Carolina. She is a director of C. D. Spangler Construction Company and Chairman of the Board of the C. D. Spangler Foundation. She has served on the Wellesley College Board of Trustees since 1989. She has been a director of the Corporation since 1988 and is a member of the Corporate Governance and Compensation Committees.
		ROBERT L. TILLMAN (63), Former Chairman and CEO Emeritus, Lowe’s Companies, Inc., Mooresville, North Carolina, a home improvement retailer. He served as Chairman and Chief Executive Officer of Lowe’s Companies, Inc. from January 1998 until January 2005. He has been a director of the Corporation since April 2005 and is a member of the Asset Quality Committee.
		JACKIE M. WARD (68), Retired Chairman/CEO, Computer Generation, Inc., Atlanta, Georgia, a telecommunications software company. She has been in her present position since December 2000. She served as Chairman of Computer Generation Incorporated, from May 2000 to December 2000 and as President and Chief Executive Officer from October 1968 to May 2000. She has been a director of the Corporation since 1994 and is chair of the Asset Quality Committee. She also serves as a director of Equifax, Inc., Flowers Industries, Inc., Sanmina-SCI Corporation, SYSCO Corporation and Wellpoint, Inc.

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Stock Ownership

As of December 31, 2006, we had two classes of voting securities: the Common Stock and the Series B Stock. As of that date, we did not know of any person who beneficially owned 5% or more of the Common Stock or the Series B Stock. In addition, as of that date, no director, nominee or executive officer owned any shares of the Series B Stock.

The following table sets forth information as of December 31, 2006 with respect to the beneficial ownership of Common Stock by: (i) each director and nominee for director; (ii) each executive officer named in the Summary Compensation Table; and (iii) all directors, nominees and executive officers as a group.

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Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires our directors and some of our officers to file reports with the SEC indicating their holdings of, and transactions in, our equity securities. Based solely on a review of the copies of such reports we received, and written representations from reporting persons, we believe that, during 2006, our reporting persons complied with all Section 16(a) filing requirements, except that Mr. Barnet filed late reports on Forms 4 to report his position as a trustee on certain trusts and to report the sale of 1,600 shares of Common Stock from one of those trusts.

Compensation Committee Report

The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis that immediately follows this report. Based on this review and discussion, the Compensation Committee has recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement and incorporated by reference into our Annual Report on Form 10-K for the year ended December 31, 2006.

Submitted by the Compensation Committee of the Board:

Paul Fulton, Chairman

Thomas M. Ryan

O. Temple Sloan, Jr.

Meredith R. Spangler

Compensation Discussion and Analysis

Overview. We operate a large, global business in a very competitive environment. To best meet the challenges of running a business of our size and scope, we have designed our executive compensation program, under the direction of the Compensation Committee of the Board, to attract and retain the highest quality executive officers and directly link pay to our performance. This pay-for-performance mandate results in a compensation program that:

The key elements of compensation for our executive officers are annual cash incentive awards, restricted stock awards (which can be granted as shares or units) and stock option awards. These awards make up most of the total annual compensation opportunity and are based on an annual performance review. Base salary, retirement benefit accruals and perquisites or other fringe benefits make up only a minor portion of the total annual compensation opportunity. Our executive officers are not covered by employment, severance or change in control agreements.

The annual performance review for determining cash incentive, restricted stock and stock option awards follows a principled, structured framework for analysis. This analysis focuses on financial performance measures that the Committee believes collectively best indicate successful management of our business. The analysis takes into ac - -

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count both performance against internal business goals and relative performance against our competitors over one-year and multi-year periods.

We provide most of the total annual compensation opportunity in stock, because stock ownership is the simplest, most direct way to align our executive officers’ interests with those of our stockholders. The vesting and other design features of these awards, together with our stock ownership guidelines, encourage long-term stock ownership by our executive officers to further motivate them to create long-term stockholder value.

Excellence in Governance. Our executive compensation program relies on the Committee’s judgment in evaluating performance using a principled, structured framework for analysis. The Committee actively engages in its duties and follows procedures intended to ensure excellence in the governance of our pay-for-performance mandate. For example, the Committee annually reviews each executive officer’s total compensation package, including base salary, cash and stock incentive awards, accumulated realized and unrealized stock option and restricted stock gains, qualified and nonqualified retirement and deferred compensation benefit accruals and the incremental cost to us of all perquisites. The Committee utilizes, and makes available to the full Board, an executive compensation statement, or “tally sheet,” for each executive officer for this purpose. For more details on our commitment to excellence in governance, see “Compensation Committee” on page 7 above.

Examples of Commitment to Pay-for-Performance. We believe that our actions in recent years demonstrate our commitment to our pay-for-performance mandate:

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Measuring Performance. We rigorously evaluate our performance each year against a set of financial metrics that provide a complete picture of the results we achieved. We evaluate our results relative to the expectations we set in our annual business plans and compared to the performance of our key competitors over one-year and multi-year periods. The central element of this analysis is a review of the following five measures of stockholder satisfaction, which the Committee believes collectively best indicate successful management of our business:

The Committee applies the following core principles in its annual performance analysis:

In order to achieve target or above target compensation awards, the Committee must determine that:

We believe this structured, principled framework for analysis requires strong performance to achieve target or above target compensation awards.

As part of its analysis, the Committee looks to how the financial goals were achieved, taking into account the quality of our earnings. The Committee also considers objective data on the successful implementation of strategic initiatives that position us for future growth while also delivering positive total stockholder returns.

For those executive officers who lead a line of business, the Committee considers how that line of business has performed against its internal business goals. In addition, as part of the annual performance review for our executive officers other than the Chief Executive Officer, the Committee considers the Chief Executive Officer’s perspective on each executive officer’s individual performance as well as on the performance of our various lines of business.

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Competitor Groups. The Committee uses the five other largest United States bank holding companies as the primary competitor group to test relative performance. These banks are: Citigroup, JP Morgan Chase, US Bancorp, Wachovia and Wells Fargo.

The Committee also reviews executive compensation and performance information for a leading group of global companies headquartered in the United States spanning all industries, including the financial industry. The selected companies each have net income exceeding $7.0 billion and market capitalization approximating or exceeding $100 billion. For 2006, these companies were: AIG, Altria, Chevron, Citigroup, ExxonMobil, General Electric, IBM, Intel, Johnson & Johnson, JPMorgan Chase, Pfizer, Procter & Gamble, Verizon, Wal-Mart and Wells Fargo.

Levels and Mix of Compensation. Each year the Committee determines a target total compensation package for each executive officer, made up of base salary plus the following three elements of performance-based compensation:

In establishing the target total compensation package for each year, the Committee considers the compensation practices at the primary competitor group and advice from the independent executive compensation consultant. The Committee also considers whether the target total compensation opportunities are internally consistent with each executive officer’s relative scope of responsibility and accountability for our overall performance. The following further describes all elements of the compensation package:

Base Salary. The Committee establishes the relative base salary levels for our executive officers to reflect each executive officer’s scope of responsibility and accountability within the company and to be part of a competitive total compensation package in light of compensation practices at the primary competitor group.

Annual Cash Incentive, Restricted Stock and Option Awards. The Committee determines the actual cash incentive, restricted stock and stock option awards for each executive officer following the end of the year based on the Committee’s assessment of his or her performance.

As discussed above, we believe our program requires strong performance in order to achieve target compensation awards. The Committee expects target total compensation to approximate the median to 75^th percentile of the primary competitor group for achieving this level of performance. Base salary makes up less than 10% of this total compensation package for our executive officers. As a result, our executive compensation program links almost all of our executive officers’ actual compensation each year to our performance as determined by the Committee.

Retirement Benefits. Executive officers participate in our various qualified and nonqualified employee benefit plans designed to provide retirement income. Our qualified and nonqualified pension plans provide a retirement income base, and our qualified and nonqualified 401(k) plans permit additional retirement savings. To encourage retirement savings under the qualified and nonqualified 401(k) plans, we provide an employer matching contribution.

Since 2005, eligible compensation for benefit accruals under the qualified and nonqualified pension plans and for employer matching contributions under the qualified and nonqualified 401(k) plans has been limited to the

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first $250,000 in annual cash compensation. As a result, the Committee’s decisions to grant annual performance-based cash incentive, restricted stock and stock option awards do not create any additional retirement benefit accruals under these plans.

None of our executive officers currently accrue any additional benefits under any supplemental executive retirement plans (SERPs). We believe that our executive officers should be able to provide for their retirement needs from the total annual compensation they earn based on our performance. Consistent with our pay-for-performance mandate, we froze benefits effective December 31, 2002 under the Bank of America Corporation and Designated Subsidiaries Supplemental Executive Retirement Plan (the “Bank of America SERP”) in which Messrs. Lewis, de Molina and Taylor, Ms. Brinkley and Ms. Desoer participate. Accordingly, no additional benefits accrue under the Bank of America SERP for compensation or service for periods beginning after December 31, 2002. In addition, at the request of Mr. Moynihan, his participation in the FleetBoston Financial Corporation Supplemental Executive Retirement Plan (the “Fleet SERP”) was frozen effective December 31, 2005, and he therefore accrues no further benefits under that plan for compensation or periods of service after that date.

For more information about these plans, see “Pension Benefits” and “Nonqualified Deferred Compensation” below.

Perquisites and Other Fringe Benefits. Our executive officers receive health and welfare benefits, such as group medical, group life and long-term disability coverage, under plans generally available to all other United States-based salaried associates. Consistent with our pay-for-performance mandate, we provide very few executive fringe benefits. Because we have internal expertise on tax and financial planning matters, we make those services available at no cost to our executive officers for their personal tax and financial planning needs. We also provide our executive officers with secured parking and home security systems. Our executive officers have access to our corporate aircraft on a limited basis for personal travel pursuant to company guidelines. Beginning in 2006, it became more expensive for executive officers to use our aircraft for personal travel. They now have income imputed to them for such travel using a third-party “charter value,” rather than the Internal Revenue Service “Standard Industry Fare Level” (or SIFL) used by many public companies.

Emphasis on Long-Term Stock Ownership. The Committee believes that stock ownership by our executive officers is the clearest, most direct way to align their interests with those of our stockholders. As a result, each executive officer’s target total annual compensation package includes a balanced combination of restricted stock and stock option awards.

We determine the relative mix of cash versus restricted stock and stock option awards in the total annual compensation opportunity based on the relative role and responsibility of the individual. The more opportunity the individual has to contribute to our success and thereby impact our stock price, the larger percentage that restricted stock and stock option awards will make up the target total annual compensation package. For our executive officers, we currently provide a majority of the total annual compensation opportunity in restricted stock and stock option awards.

The Committee believes in a balanced approach to stock compensation, providing for a mix of restricted stock and stock option awards. In recent years, the Committee has placed somewhat greater emphasis on restricted stock awards over stock options as a means to increase long-term stock ownership by our executive officers. We have designed our restricted stock and stock option awards to encourage long-term stock ownership through the following features:

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In addition, we have formal stock ownership guidelines for our executive officers. Under these guidelines, our Chief Executive Officer must hold at least 500,000 shares of our Common Stock and our other executive officers at least 150,000 shares. We disregard unexercised stock options (whether vested or unvested) for this purpose. As of December 31, 2006, all of our executive officers met these guidelines.

Example: How the Executive Compensation Program was applied in 2006 for the Chief Executive Officer. Early in 2006, the Committee established a total target compensation package for Mr. Lewis for 2006 as follows:

In establishing this total target compensation package, the Committee reviewed the total compensation packages provided to the Chief Executive Officers of our primary competitor group and took into account our relative size and the scope of our business.

In early 2007, the Committee reviewed our performance following our structured, principled framework for analysis.

Step 1: The Committee reviewed performance against internal business goals for 2006 and determined that we had exceeded all key operating goals. Our actual results versus our 2006 internal business goals were as follows:

Step 2: The Committee reviewed our performance relative to the primary competitor group over one-year, three-year (2004-2006) and five-year (2002-2006) timeframes, as well as over the full tenure of our Chief Executive Officer (2001-2006). The Committee concluded that we had achieved strong performance relative to the competitor group in the current year and over the longer term. In particular, the Committee noted:

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Step 3: The Committee considered the quality of our earnings and our continued strategic initiatives to position us for future growth while delivering positive total stockholder returns. In particular, the Committee noted the successful integrations of FleetBoston and MBNA, the investment in China Construction Bank and the announced acquisition of U.S. Trust.

Based on this analysis, the Committee determined to award Mr. Lewis total compensation for 2006 slightly above his 2006 target level, with a majority of the award in the form of restricted stock and stock option awards. The final awards were as follows:

Timing of Equity Grants. We make annual awards of restricted stock and stock options to executive officers and other eligible key associates on a regular award date each year shortly after the end of the applicable performance year. This is the same date that we pay cash incentive awards for the performance year, and is scheduled to give us sufficient time to complete all performance reviews and obtain all necessary approvals. For the past few years, the annual award date has been February 15, or the immediately preceding business day if February 15 is not a business day.

We occasionally make awards of restricted stock or stock options other than on the regular annual award date, usually in connection with hiring a new key associate or awards under annual performance plans that follow a different timing cycle. We make these awards on the first day of the calendar month following approval, which for newly hired associates is on or after their actual hire date.

Formal approval for awards is obtained prior to the grant dates. We do not coordinate the timing of our awards with the release of material non-public information. The exercise price for the stock options equals the closing price of our Common Stock for the grant date.

Impact of SEC and Accounting Rules on Compensation Disclosure. Under accounting rules, we are required to expense the full grant date fair value of restricted stock and stock option awards for all of our executive officers in the year of grant because each executive officer meets the Rule of 60 as described above. This means that, for example, restricted stock and stock option awards made to our executive officers in February 2007 for 2006 performance will be expensed in full in 2007.

However, the new SEC disclosure rules require that we include in the Summary Compensation Table as 2006 compensation the value of restricted stock and stock option awards expensed in 2006. The awards expensed in 2006 for our executive officers represent the value of prior year awards, including the awards granted in February 2006 that relate to 2005 performance. As a result, while the “Non-Equity Incentive Compensation” column in the Summary Compensation Table will present the annual cash incentive award for performance in the year indicated, the restricted stock and stock option awards presented in the table will not be for performance in the year indicated.

In order to provide our stockholders with a complete picture of the direct link between our executive compensation program and our performance, we are furnishing two versions of the Summary Compensation Table:

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Alternative Summary Compensation Table

Compensation for 2006 Performance

Section 162(m). Compensation decisions for our executive officers are made with full consideration of the Internal Revenue Code Section 162(m) implications. Section 162(m) limits the deductibility of compensation paid to certain executive officers in excess of $1.0 million, but excludes “performance-based compensation” from this limit.

Cash incentive compensation and restricted stock awards are provided under the stockholder-approved Executive Incentive Compensation Plan (EIC Plan). Under the EIC Plan’s compensation formula, participating executive officers may receive maximum deductible incentive compensation for a year up to 0.20% of our net income for that year. Under the EIC Plan, the Committee can determine to make all or any portion of the annual incentive award in the form of a restricted stock award under our Key Associate Stock Plan.

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In addition, compensation realized by our executive officers through the exercise of stock options should be fully deductible to us as “performance-based compensation” under Section 162(m).

Conclusion. We believe our executive compensation program results in total compensation awards that are reasonable and appropriate in amount, are directly correlated to our performance, align our executive officers’ interests with those of our stockholders and are easy for our stockholders to understand.

Executive Compensation

Summary Compensation Table. The following table shows compensation paid, accrued or expensed with respect to our executive officers during the year indicated.

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To better provide our stockholders with a complete picture of the direct link between our executive compensation program and our performance, we illustrate in the Compensation Discussion and Analysis how the Summary Compensation Table would have appeared had it been prepared using the grant date fair value of restricted stock and stock option awards granted in February 2007 for 2006 performance, rather than amounts expensed in 2006.

The grant date fair value of restricted stock awards expensed in 2006 was based on the closing price of the Common Stock on the applicable grant date. The grant date fair value of stock option awards expensed in 2006 was determined based on the assumptions in the following chart:

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The “Change in Pension Value” equals the change in the actuarial present value of all pension benefits from December 31, 2005 to December 31, 2006. For this purpose, in accordance with SEC rules, the present value was determined using the same assumptions applicable for valuing pension benefits for purposes of our financial statements. See “Pension Benefits” below.

Consistent with our pay-for-performance mandate, the named executive officers are not accruing significant additional pension benefits. This is because pension benefits accrue only on the first $250,000 of compensation.

The amounts listed above under “Change in Pension Value” result primarily because the named executive officers, other than Mr. McGee, all have frozen annuity benefits under prior supplemental executive retirement plans.

Although no additional benefits accrue under these plans for any compensation or service after the plan freeze date, the actuarial present value of these frozen future annuity benefits increases each year primarily because the executive officer is one year closer to retirement age. This increase in actuarial present value due to the passage of time is required to be included in the “Change in Pension Value” under SEC rules.

The above-market earnings on nonqualified deferred compensation results from Mr. Moynihan’s participation in a legacy FleetBoston deferred compensation plan that includes a 12% annual interest crediting rate for certain prior year deferrals. See “Nonqualified Deferred Compensation” below.

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Certain of the amounts in this table are based on the incremental cost to us in providing the benefits, explained in more detail as follows:

The value of split dollar coverage represents the economic value of premiums that have been paid by us for certain life insurance coverage for Mr. Lewis and his spouse, which premiums will be recovered by us in the future when the insurance policy matures. We have not paid any premiums for such coverage since 2001.

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Grants of Plan-Based Awards. The following table shows additional information regarding: (i) the target level of annual cash incentive awards for our executive officers for performance during 2006, as established by the Compensation Committee in January 2006; and (ii) restricted stock and stock option awards granted in February 2006 that were awarded for performance during 2005, as required by the new SEC disclosure rules. The actual amount of the annual cash incentive award received by each executive officer for performance during 2006 is shown in the Summary Compensation Table. The Compensation Discussion and Analysis includes information about restricted stock and stock option awards granted in February 2007 for performance during 2006.