Exhibit 99.2
Supplemental Information
Fourth Quarter 2008
This information is preliminary and based on company data available at the time of the presentation. It speaks only as of the particular date or dates included in the accompanying pages. Bank of America does not undertake an obligation to, and disclaims any duty to, correct or update any of the information provided. Any forward-looking statements in this information are subject to the forward-looking language contained in Bank of America’s reports filed with the SEC pursuant to the Securities Exchange Act of 1934, which are available at the SEC’s website (www.sec.gov) or at Bank of America’s website (www.bankofamerica.com). Bank of America’s future financial performance is subject to risks and uncertainties as described in its SEC filings.
| Bank of America Corporation and Subsidiaries |
||
| Table of Contents | Page | |
| Consolidated Financial Highlights |
2 | |
| Supplemental Financial Data |
3 | |
| Consolidated Statement of Income |
4 | |
| Consolidated Balance Sheet |
5 | |
| Capital Management |
6 | |
| Core Net Interest Income - Managed Basis |
7 | |
| Quarterly Average Balances and Interest Rates |
8 | |
| Quarterly Average Balances and Interest Rates - Isolating Hedge Income/Expense |
9 | |
| Year-to-Date Average Balances and Interest Rates |
10 | |
| Year-to-Date Average Balances and Interest Rates - Isolating Hedge Income/Expense |
11 | |
| Global Consumer and Small Business Banking |
||
| Total Segment Results |
12 | |
| Quarter-to-Date Business Results |
13 | |
| Year-to-Date Business Results |
14 | |
| Key Indicators |
15 | |
| E-commerce & BankofAmerica.com |
16 | |
| Credit Card Data |
17 | |
| Global Corporate and Investment Banking |
||
| Total Segment Results |
18 | |
| Quarter-to-Date Business Results |
19 | |
| Year-to-Date Business Results |
20 | |
| Business Lending Key Indicators |
21 | |
| Capital Markets and Advisory Services Key Indicators |
22 | |
| Special Purpose Entities Liquidity Exposure |
23 | |
| Super Senior Collateralized Debt Obligation Exposure |
24 | |
| Subprime Super Senior Collateralized Debt Obligation Carrying Values |
25 | |
| Global Wealth and Investment Management |
||
| Total Segment Results |
26 | |
| Quarter-to-Date Business Results |
27 | |
| Year-to-Date Business Results |
28 | |
| Key Indicators |
29 | |
| All Other |
||
| Total Segment Results |
30 | |
| Outstanding Loans and Leases |
31 | |
| Quarterly Average Loans and Leases by Business Segment |
32 | |
| Commercial Credit Exposure by Industry |
33 | |
| Net Credit Default Protection by Maturity Profile and Credit Exposure Debt Rating |
34 | |
| Selected Emerging Markets |
35 | |
| Nonperforming Assets |
36 | |
| Quarterly Net Charge-offs/Losses and Net Charge-off/Loss Ratios |
37 | |
| Year-to-Date Net Charge-offs/Losses and Net Charge-off/Loss Ratios |
38 | |
| Allocation of the Allowance for Credit Losses by Product Type |
39 | |
| Exhibit A: Non-GAAP Reconciliations |
40 | |
| Exhibit B: Selected Fourth Quarter 2008 Merrill Lynch Results |
42 | |
| 1 |
Bank of America Corporation and Subsidiaries
Consolidated Financial Highlights
(Dollars in millions, except per share information; shares in thousands)
| Year Ended December 31 |
Fourth Quarter |
Third Quarter |
Second Quarter |
First Quarter |
Fourth Quarter |
||||||||||||||||||||||||||||||||
| 2008 | 2007 | 2008 (1) | 2008 | 2008 | 2008 | 2007 | |||||||||||||||||||||||||||||||
| Income statement |
|||||||||||||||||||||||||||||||||||||
| Net interest income |
$ | 45,360 | $ | 34,441 | $ | 13,106 | $ | 11,642 | $ | 10,621 | $ | 9,991 | $ | 9,165 | |||||||||||||||||||||||
| Noninterest income |
27,422 | 32,392 | 2,574 | 7,979 | 9,789 | 7,080 | 3,639 | ||||||||||||||||||||||||||||||
| Total revenue, net of interest expense |
72,782 | 66,833 | 15,680 | 19,621 | 20,410 | 17,071 | 12,804 | ||||||||||||||||||||||||||||||
| Provision for credit losses |
26,825 | 8,385 | 8,535 | 6,450 | 5,830 | 6,010 | 3,310 | ||||||||||||||||||||||||||||||
| Noninterest expense, before merger and restructuring charges |
40,594 | 37,114 | 10,641 | 11,413 | 9,447 | 9,093 | 10,269 | ||||||||||||||||||||||||||||||
| Merger and restructuring charges |
935 | 410 | 306 | 247 | 212 | 170 | 140 | ||||||||||||||||||||||||||||||
| Income tax expense (benefit) |
420 | 5,942 | (2,013 | ) | 334 | 1,511 | 588 | (1,183 | ) | ||||||||||||||||||||||||||||
| Net income (loss) |
4,008 | 14,982 | (1,789 | ) | 1,177 | 3,410 | 1,210 | 268 | |||||||||||||||||||||||||||||
| Preferred stock dividends |
1,452 | 182 | 603 | 473 | 186 | 190 | 53 | ||||||||||||||||||||||||||||||
| Net income (loss) applicable to common shareholders |
2,556 | 14,800 | (2,392 | ) | 704 | 3,224 | 1,020 | 215 | |||||||||||||||||||||||||||||
| Diluted earnings (loss) per common share |
0.55 | 3.30 | (0.48 | ) | 0.15 | 0.72 | 0.23 | 0.05 | |||||||||||||||||||||||||||||
| Average diluted common shares issued and outstanding |
4,612,491 | 4,480,254 | 4,957,049 | 4,563,508 | 4,457,193 | 4,461,201 | 4,470,108 | ||||||||||||||||||||||||||||||
| Dividends paid per common share |
$ | 2.24 | $ | 2.40 | $ | 0.32 | $ | 0.64 | $ | 0.64 | $ | 0.64 | $ | 0.64 | |||||||||||||||||||||||
| Performance ratios |
|||||||||||||||||||||||||||||||||||||
| Return on average assets |
0.22 | % | 0.94 | % | (0.37 | ) | % | 0.25 | % | 0.78 | % | 0.28 | % | 0.06 | % | ||||||||||||||||||||||
| Return on average common shareholders’ equity |
1.80 | 11.08 | (6.68 | ) | 1.97 | 9.25 | 2.90 | 0.60 | |||||||||||||||||||||||||||||
| At period end |
|||||||||||||||||||||||||||||||||||||
| Book value per share of common stock |
$ | 27.77 | $ | 32.09 | $ | 27.77 | $ | 30.01 | $ | 31.11 | $ | 31.22 | $ | 32.09 | |||||||||||||||||||||||
| Tangible book value per share of common stock (2) |
11.44 | 14.62 | 11.44 | 12.08 | 13.65 | 13.73 | 14.62 | ||||||||||||||||||||||||||||||
| Market price per share of common stock: |
|||||||||||||||||||||||||||||||||||||
| Closing price |
$ | 14.08 | $ | 41.26 | $ | 14.08 | $ | 35.00 | $ | 23.87 | $ | 37.91 | $ | 41.26 | |||||||||||||||||||||||
| High closing price for the period |
45.03 | 54.05 | 38.13 | 37.48 | 40.86 | 45.03 | 52.71 | ||||||||||||||||||||||||||||||
| Low closing price for the period |
11.25 | 41.10 | 11.25 | 18.52 | 23.87 | 35.31 | 41.10 | ||||||||||||||||||||||||||||||
| Market capitalization |
70,645 | 183,107 | 70,645 | 159,672 | 106,292 | 168,806 | 183,107 | ||||||||||||||||||||||||||||||
| Number of banking centers - domestic |
6,139 | 6,149 | 6,139 | 6,139 | 6,131 | 6,148 | 6,149 | ||||||||||||||||||||||||||||||
| Number of branded ATMs - domestic |
18,685 | 18,753 | 18,685 | 18,584 | 18,531 | 18,491 | 18,753 | ||||||||||||||||||||||||||||||
| Full-time equivalent employees |
243,075 | 209,718 | 243,075 | 249,993 | 206,587 | 209,096 | 209,718 | ||||||||||||||||||||||||||||||
| (1) | Due to the net loss for the three months ended December 31, 2008, the impact of antidilutive equity instruments have been excluded from diluted earnings per share and average diluted common shares. |
| (2) | Tangible book value per share of common stock is a non-GAAP measure. For a corresponding reconciliation of common tangible shareholders’ equity to a GAAP financial measure, see Supplemental Financial Data on page 3. We believe the use of this non-GAAP measure provides additional clarity in assessing the results of the Corporation. |
Certain prior period amounts have been reclassified to conform to current period presentation.
| Information for periods beginning July 1, 2008 includes the Countrywide acquisition; prior periods have not been restated. This information is preliminary and based on company data available at the time of the presentation. | 2 |
Bank of America Corporation and Subsidiaries
Supplemental Financial Data
(Dollars in millions)
Fully taxable-equivalent basis data
| Fourth Quarter 2008 |
Third Quarter 2008 |
Second Quarter 2008 |
First Quarter 2008 |
Fourth Quarter 2007 |
||||||||||||||||||||||||||||||||||||||
| Year Ended December 31 |
||||||||||||||||||||||||||||||||||||||||||
| 2008 | 2007 | |||||||||||||||||||||||||||||||||||||||||
| Net interest income |
$ | 46,554 | $ | 36,190 | $ | 13,406 | $ | 11,920 | $ | 10,937 | $ | 10,291 | $ | 9,815 | ||||||||||||||||||||||||||||
| Total revenue, net of interest expense |
73,976 | 68,582 | 15,980 | 19,899 | 20,726 | 17,371 | 13,454 | |||||||||||||||||||||||||||||||||||
| Net interest yield |
2.98 | % | 2.60 | % | 3.31 | % | 2.93 | % | 2.92 | % | 2.73 | % | 2.61 | % | ||||||||||||||||||||||||||||
| Efficiency ratio |
56.14 | 54.71 | 68.51 | 58.60 | 46.60 | 53.32 | 77.36 | |||||||||||||||||||||||||||||||||||
|
Reconciliation to GAAP financial measures
Supplemental financial data presented on an operating basis is a basis of presentation not defined by accounting principles generally accepted in the United States (GAAP) that excludes merger and restructuring charges. We believe that the exclusion of merger and restructuring charges, which represent events outside our normal operations, provides a meaningful period-to-period comparison and is more reflective of normalized operations.
Return on average common shareholders’ equity and return on average tangible shareholders’ equity utilize non-GAAP allocation methodologies. Return on average common shareholders’ equity measures the earnings contribution of a unit as a percentage of the shareholders’ equity allocated to that unit. Return on average tangible shareholders’ equity measures the earnings contribution of the Corporation as a percentage of shareholders’ equity reduced by goodwill. These measures are used to evaluate our use of equity (i.e., capital) at the individual unit level and are integral components in the analytics for resource allocation. The efficiency ratio measures the costs expended to generate a dollar of revenue. We believe the use of these non-GAAP measures provides additional clarity in assessing the results of the Corporation.
Other companies may define or calculate supplemental financial data differently. See the tables below for supplemental financial data and corresponding reconciliations to GAAP financial measures for the three months ended December 31, 2008, September 30, 2008, June 30, 2008, March 31, 2008 and December 31, 2007, and the years ended December 31, 2008 and 2007.
Reconciliation of net income to operating earnings
| ||||||||||||||||||||||||||||||||||||||||||
| Fourth Quarter 2008 |
Third Quarter 2008 |
Second Quarter 2008 |
First Quarter 2008 |
Fourth Quarter 2007 |
||||||||||||||||||||||||||||||||||||||
| Year Ended December 31 |
||||||||||||||||||||||||||||||||||||||||||
| 2008 | 2007 | |||||||||||||||||||||||||||||||||||||||||
| Net income (loss) |
$ | 4,008 | $ | 14,982 | $ | (1,789 | ) | $ | 1,177 | $ | 3,410 | $ | 1,210 | $ | 268 | |||||||||||||||||||||||||||
| Merger and restructuring charges |
935 | 410 | 306 | 247 | 212 | 170 | 140 | |||||||||||||||||||||||||||||||||||
| Related income tax benefit |
(305 | ) | (152 | ) | (100 | ) | (64 | ) | (78 | ) | (63 | ) | (52 | ) | ||||||||||||||||||||||||||||
| Operating earnings (loss) |
$ | 4,638 | $ | 15,240 | $ | (1,583 | ) | $ | 1,360 | $ | 3,544 | $ | 1,317 | $ | 356 | |||||||||||||||||||||||||||
| Reconciliation of ending common shareholders’ equity to ending common tangible shareholders’ equity |
|
|||||||||||||||||||||||||||||||||||||||||
| Ending common shareholders’ equity |
$ | 139,351 | $ | 142,394 | $ | 139,351 | $ | 136,888 | $ | 138,540 | $ | 139,003 | $ | 142,394 | ||||||||||||||||||||||||||||
| Ending goodwill |
(81,934 | ) | (77,530 | ) | (81,934 | ) | (81,756 | ) | (77,760 | ) | (77,872 | ) | (77,530 | ) | ||||||||||||||||||||||||||||
| Ending common tangible shareholders’ equity |
$ | 57,417 | $ | 64,864 | $ | 57,417 | $ | 55,132 | $ | 60,780 | $ | 61,131 | $ | 64,864 | ||||||||||||||||||||||||||||
| Reconciliation of average shareholders’ equity to average tangible shareholders’ equity |
|
|||||||||||||||||||||||||||||||||||||||||
| Average shareholders’ equity |
$ | 164,831 | $ | 136,662 | $ | 176,566 | $ | 166,454 | $ | 161,428 | $ | 154,728 | $ | 144,924 | ||||||||||||||||||||||||||||
| Average goodwill |
(79,827 | ) | (69,333 | ) | (81,841 | ) | (81,977 | ) | (77,815 | ) | (77,628 | ) | (78,308 | ) | ||||||||||||||||||||||||||||
| Average tangible shareholders’ equity |
$ | 85,004 | $ | 67,329 | $ | 94,725 | $ | 84,477 | $ | 83,613 | $ | 77,100 | $ | 66,616 | ||||||||||||||||||||||||||||
| Operating basis | ||||||||||||||||||||||||||||||||||||||||||
| Return on average assets |
0.25 | % | 0.95 | % | (0.32 | ) | % | 0.28 | % | 0.81 | % | 0.30 | % | 0.08 | % | |||||||||||||||||||||||||||
| Return on average common shareholders’ equity |
2.25 | 11.27 | (6.10 | ) | 2.48 | 9.63 | 3.20 | 0.85 | ||||||||||||||||||||||||||||||||||
| Return on average tangible shareholders’ equity |
5.46 | 22.64 | (6.65 | ) | 6.40 | 17.05 | 6.87 | 2.12 | ||||||||||||||||||||||||||||||||||
| Efficiency ratio (1) |
54.88 | 54.12 | 66.60 | 57.36 | 45.58 | 52.35 | 76.32 | |||||||||||||||||||||||||||||||||||
| (1) | Fully taxable-equivalent basis |
Certain prior period amounts have been reclassified to conform to current period presentation.
| Information for periods beginning July 1, 2008 includes the Countrywide acquisition; prior periods have not been restated. This information is preliminary and based on company data available at the time of the presentation | 3 |
Bank of America Corporation and Subsidiaries
Consolidated Statement of Income
(Dollars in millions, except per share information; shares in thousands)
| Fourth Quarter 2008 (1) |
Third Quarter 2008 |
Second Quarter 2008 |
First Quarter 2008 |
Fourth Quarter 2007 |
||||||||||||||||||||||||||
| Year Ended December 31 |
||||||||||||||||||||||||||||||
| 2008 | 2007 | |||||||||||||||||||||||||||||
| Interest income |
||||||||||||||||||||||||||||||
| Interest and fees on loans and leases |
$ | 56,017 | $ | 55,681 | $ | 14,220 | $ | 14,261 | $ | 13,121 | $ | 14,415 | $ | 15,363 | ||||||||||||||||
| Interest on debt securities |
13,146 | 9,784 | 3,851 | 3,621 | 2,900 | 2,774 | 2,738 | |||||||||||||||||||||||
| Federal funds sold and securities purchased under agreements to resell |
3,313 | 7,722 | 393 | 912 | 800 | 1,208 | 1,748 | |||||||||||||||||||||||
| Trading account assets |
9,057 | 9,417 | 2,120 | 2,344 | 2,229 | 2,364 | 2,358 | |||||||||||||||||||||||
| Other interest income |
4,151 | 4,700 | 1,018 | 1,058 | 977 | 1,098 | 1,272 | |||||||||||||||||||||||
| Total interest income |
85,684 | 87,304 | 21,602 | 22,196 | 20,027 | 21,859 | 23,479 | |||||||||||||||||||||||
| Interest expense |
||||||||||||||||||||||||||||||
| Deposits |
15,250 | 18,093 | 3,296 | 3,846 | 3,520 | 4,588 | 5,253 | |||||||||||||||||||||||
| Short-term borrowings |
12,362 | 21,967 | 1,910 | 3,223 | 3,087 | 4,142 | 5,598 | |||||||||||||||||||||||
| Trading account liabilities |
2,774 | 3,444 | 524 | 661 | 749 | 840 | 825 | |||||||||||||||||||||||
| Long-term debt |
9,938 | 9,359 | 2,766 | 2,824 | 2,050 | 2,298 | 2,638 | |||||||||||||||||||||||
| Total interest expense |
40,324 | 52,863 | 8,496 | 10,554 | 9,406 | 11,868 | 14,314 | |||||||||||||||||||||||
| Net interest income |
45,360 | 34,441 | 13,106 | 11,642 | 10,621 | 9,991 | 9,165 | |||||||||||||||||||||||
| Noninterest income |
||||||||||||||||||||||||||||||
| Card income |
13,314 | 14,077 | 3,102 | 3,122 | 3,451 | 3,639 | 3,591 | |||||||||||||||||||||||
| Service charges |
10,316 | 8,908 | 2,559 | 2,722 | 2,638 | 2,397 | 2,415 | |||||||||||||||||||||||
| Investment and brokerage services |
4,972 | 5,147 | 1,072 | 1,238 | 1,322 | 1,340 | 1,427 | |||||||||||||||||||||||
| Investment banking income |
2,263 | 2,345 | 618 | 474 | 695 | 476 | 544 | |||||||||||||||||||||||
| Equity investment income (loss) |
539 | 4,064 | (791 | ) | (316 | ) | 592 | 1,054 | 317 | |||||||||||||||||||||
| Trading account profits (losses) |
(5,911 | ) | (4,889 | ) | (4,101 | ) | (384 | ) | 357 | (1,783 | ) | (5,380 | ) | |||||||||||||||||
| Mortgage banking income |
4,087 | 902 | 1,523 | 1,674 | 439 | 451 | 386 | |||||||||||||||||||||||
| Insurance premiums |
1,833 | 761 | 741 | 678 | 217 | 197 | 213 | |||||||||||||||||||||||
| Gains on sales of debt securities |
1,124 | 180 | 762 | 10 | 127 | 225 | 109 | |||||||||||||||||||||||
| Other income (loss) |
(5,115 | ) | 897 | (2,911 | ) | (1,239 | ) | (49 | ) | (916 | ) | 17 | ||||||||||||||||||
| Total noninterest income |
27,422 | 32,392 | 2,574 | 7,979 | 9,789 | 7,080 | 3,639 | |||||||||||||||||||||||
| Total revenue, net of interest expense |
72,782 | 66,833 | 15,680 | 19,621 | 20,410 | 17,071 | 12,804 | |||||||||||||||||||||||
| Provision for credit losses |
26,825 | 8,385 | 8,535 | 6,450 | 5,830 | 6,010 | 3,310 | |||||||||||||||||||||||
| Noninterest expense |
||||||||||||||||||||||||||||||
| Personnel |
18,371 | 18,753 | 4,027 | 5,198 | 4,420 | 4,726 | 4,822 | |||||||||||||||||||||||
| Occupancy |
3,626 | 3,038 | 1,003 | 926 | 848 | 849 | 827 | |||||||||||||||||||||||
| Equipment |
1,655 | 1,391 | 447 | 440 | 372 | 396 | 373 | |||||||||||||||||||||||
| Marketing |
2,368 | 2,356 | 555 | 605 | 571 | 637 | 712 | |||||||||||||||||||||||
| Professional fees |
1,592 | 1,174 | 521 | 424 | 362 | 285 | 404 | |||||||||||||||||||||||
| Amortization of intangibles |
1,834 | 1,676 | 477 | 464 | 447 | 446 | 467 | |||||||||||||||||||||||
| Data processing |
2,546 | 1,962 | 641 | 755 | 587 | 563 | 590 | |||||||||||||||||||||||
| Telecommunications |
1,106 | 1,013 | 292 | 288 | 266 | 260 | 263 | |||||||||||||||||||||||
| Other general operating |
7,496 | 5,751 | 2,678 | 2,313 | 1,574 | 931 | 1,811 | |||||||||||||||||||||||
| Merger and restructuring charges |
935 | 410 | 306 | 247 | 212 | 170 | 140 | |||||||||||||||||||||||
| Total noninterest expense |
41,529 | 37,524 | 10,947 | 11,660 | 9,659 | 9,263 | 10,409 | |||||||||||||||||||||||
| Income (loss) before income taxes |
4,428 | 20,924 | (3,802 | ) | 1,511 | 4,921 | 1,798 | (915 | ) | |||||||||||||||||||||
| Income tax expense (benefit) |
420 | 5,942 | (2,013 | ) | 334 | 1,511 | 588 | (1,183 | ) | |||||||||||||||||||||
| Net income (loss) |
$ | 4,008 | $ | 14,982 | $ | (1,789 | ) | $ | 1,177 | $ | 3,410 | $ | 1,210 | $ | 268 | |||||||||||||||
| Preferred stock dividends |
1,452 | 182 | 603 | 473 | 186 | 190 | 53 | |||||||||||||||||||||||
| Net income (loss) applicable to common shareholders |
$ | 2,556 | $ | 14,800 | $ | (2,392 | ) | $ | 704 | $ | 3,224 | $ | 1,020 | $ | 215 | |||||||||||||||
| Per common share information |
||||||||||||||||||||||||||||||
| Earnings (loss) |
$ | 0.56 | $ | 3.35 | $ | (0.48 | ) | $ | 0.15 | $ | 0.73 | $ | 0.23 | $ | 0.05 | |||||||||||||||
| Diluted earnings (loss) |
0.55 | 3.30 | (0.48 | ) | 0.15 | 0.72 | 0.23 | 0.05 | ||||||||||||||||||||||
| Dividends paid |
2.24 | 2.40 | 0.32 | 0.64 | 0.64 | 0.64 | 0.64 | |||||||||||||||||||||||
| Average common shares issued and outstanding |
4,592,085 | 4,423,579 | 4,957,049 | 4,543,963 | 4,435,719 | 4,427,823 | 4,421,554 | |||||||||||||||||||||||
| Average diluted common shares issued and outstanding |
4,612,491 | 4,480,254 | 4,957,049 | 4,563,508 | 4,457,193 | 4,461,201 | 4,470,108 | |||||||||||||||||||||||
| (1) | Due to the net loss for the three months ended December 31, 2008, the impact of antidilutive equity instruments have been excluded from diluted earnings per share and average diluted common shares. |
Certain prior period amounts have been reclassified to conform to current period presentation.
| Information for periods beginning July 1, 2008 includes the Countrywide acquisition; prior periods have not been restated. This information is preliminary and based on company data available at the time of the presentation | 4 |
Bank of America Corporation and Subsidiaries
Consolidated Balance Sheet
(Dollars in millions)
| December 31 2008 |
September 30 2008 |
December 31 2007 |
|||||||
| Assets |
|||||||||
| Cash and cash equivalents |
$ 32,857 | $ 39,341 | $ 42,531 | ||||||
| Time deposits placed and other short-term investments |
9,570 | 11,709 | 11,773 | ||||||
| Federal funds sold and securities purchased under agreements to resell |
82,478 | 87,038 | 129,552 | ||||||
| Trading account assets |
159,522 | 174,859 | 162,064 | ||||||
| Derivative assets |
62,252 | 45,792 | 34,662 | ||||||
| Debt securities |
277,589 | 258,677 | 214,056 | ||||||
| Loans and leases, net of allowance: |
|||||||||
| Loans and leases |
931,446 | 942,676 | 876,344 | ||||||
| Allowance for loan and lease losses |
(23,071 | ) | (20,346 | ) | (11,588 | ) | |||
| Total loans and leases, net of allowance |
908,375 | 922,330 | 864,756 | ||||||
| Premises and equipment, net |
13,161 | 13,000 | 11,240 | ||||||
| Mortgage servicing rights (includes $12,733, $20,811 and $3,053 measured at fair value) |
13,056 | 21,131 | 3,347 | ||||||
| Goodwill |
81,934 | 81,756 | 77,530 | ||||||
| Intangible assets |
8,535 | 9,167 | 10,296 | ||||||
| Loans held-for-sale |
31,454 | 27,414 | 34,424 | ||||||
| Other assets |
137,160 | 138,963 | 119,515 | ||||||
| Total assets |
$1,817,943 | $1,831,177 | $1,715,746 | ||||||
| Liabilities |
|||||||||
| Deposits in domestic offices: |
|||||||||
| Noninterest-bearing |
$ 213,994 | $ 201,025 | $ 188,466 | ||||||
| Interest-bearing |
576,938 | 577,503 | 501,882 | ||||||
| Deposits in foreign offices: |
|||||||||
| Noninterest-bearing |
4,004 | 3,524 | 3,761 | ||||||
| Interest-bearing |
88,061 | 91,999 | 111,068 | ||||||
| Total deposits |
882,997 | 874,051 | 805,177 | ||||||
| Federal funds purchased and securities sold under agreements to repurchase |
206,598 | 225,729 | 221,435 | ||||||
| Trading account liabilities |
57,287 | 68,229 | 77,342 | ||||||
| Derivative liabilities |
30,709 | 26,466 | 22,423 | ||||||
| Commercial paper and other short-term borrowings |
158,056 | 145,812 | 191,089 | ||||||
| Accrued expenses and other liabilities (includes $421, $427 and $518 of reserve for unfunded lending commitments) |
36,952 | 72,141 | 53,969 | ||||||
| Long-term debt |
268,292 | 257,710 | 197,508 | ||||||
| Total liabilities |
1,640,891 | 1,670,138 | 1,568,943 | ||||||
| Shareholders’ equity |
|||||||||
| Preferred stock, $0.01 par value; authorized - 100,000,000 shares; issued and outstanding - 8,202,042, 7,602,067 and 185,067 shares |
37,701 | 24,151 | 4,409 | ||||||
| Common stock and additional paid-in capital, $0.01 par value; authorized - 10,000,000,000, 7,500,000,000, and 7,500,000,000 shares; issued and outstanding - 5,017,435,592, 4,562,054,554 and 4,437,885,419 shares |
76,766 | 65,361 | 60,328 | ||||||
| Retained earnings |
73,823 | 77,695 | 81,393 | ||||||
| Accumulated other comprehensive income (loss) |
(10,825 | ) | (5,647 | ) | 1,129 | ||||
| Other |
(413 | ) | (521 | ) | (456 | ) | |||
| Total shareholders’ equity |
177,052 | 161,039 | 146,803 | ||||||
| Total liabilities and shareholders’ equity |
$1,817,943 | $1,831,177 | $1,715,746 | ||||||
Certain prior period amounts have been reclassified to conform to current period presentation.
| Information for periods beginning July 1, 2008 includes the Countrywide acquisition; prior periods have not been restated. This information is preliminary and based on company data available at the time of the presentation | 5 |
Bank of America Corporation and Subsidiaries
Capital Management
(Dollars in millions)
| Fourth Quarter 2008 (1) |
Third Quarter 2008 |
Second Quarter 2008 |
First Quarter 2008 |
Fourth Quarter 2007 |
|||||||||||||||||||||
| Risk-based capital: |
|||||||||||||||||||||||||
| Tier 1 capital |
$ | 120,804 | $ | 100,248 | $ | 101,439 | $ | 93,899 | $ | 83,372 | |||||||||||||||
| Total capital |
171,644 | 153,318 | 154,983 | 146,531 | 133,720 | ||||||||||||||||||||
| Risk-weighted assets |
1,320,824 | 1,328,084 | 1,230,307 | 1,250,942 | 1,212,905 | ||||||||||||||||||||
| Tier 1 capital ratio |
9.15 | % | 7.55 | % | 8.25 | % | 7.51 | % | 6.87 | % | |||||||||||||||
| Total capital ratio |
13.00 | 11.54 | 12.60 | 11.71 | 11.02 | ||||||||||||||||||||
| Tangible equity ratio (2) |
5.01 | 4.03 | 4.62 | 4.16 | 3.62 | ||||||||||||||||||||
| Tangible common equity ratio (3) |
2.83 | 2.64 | 3.14 | 3.11 | 3.35 | ||||||||||||||||||||
| Tier 1 leverage ratio |
6.44 | 5.51 | 6.07 | 5.59 | 5.04 | ||||||||||||||||||||
| (1) | Preliminary data on risk-based capital |
| (2) | Tangible equity ratio equals shareholders’ equity less goodwill and intangible assets divided by total assets less goodwill and intangible assets. |
| (3) | Tangible common equity ratio equals common shareholders’ equity less goodwill and intangible assets divided by total assets less goodwill and intangible assets. |
Share Repurchase Program
No common shares were repurchased in the fourth quarter of 2008.
| 75.0 | million shares remain outstanding under the 2008 authorized program. |
381 thousand shares were issued in the fourth quarter of 2008 under employee stock plans.
455.0 million common stock shares were issued to raise capital in the fourth quarter of 2008.
| * | Preliminary data on risk-based capital |
Certain prior period amounts have been reclassified to conform to current period presentation.
| Information for periods beginning July 1, 2008 includes the Countrywide acquisition; prior periods have not been restated. This information is preliminary and based on company data available at the time of the presentation | 6 |
Bank of America Corporation and Subsidiaries
Core Net Interest Income - Managed Basis
(Dollars in millions)
| Year Ended December 31 |
Fourth Quarter 2008 |
Third Quarter 2008 |
Second Quarter 2008 |
First Quarter 2008 |
Fourth Quarter 2007 |
|||||||||||||||||||||||||||||||||||||
| 2008 | 2007 | |||||||||||||||||||||||||||||||||||||||||
| Net interest income (1) |
||||||||||||||||||||||||||||||||||||||||||
| As reported |
$ | 46,554 | $ | 36,190 | $ | 13,406 | $ | 11,920 | $ | 10,937 | $ | 10,291 | $ | 9,815 | ||||||||||||||||||||||||||||
| Impact of market-based net interest income (2) |
(6,011 | ) | (2,718 | ) | (1,886 | ) | (1,448 | ) | (1,369 | ) | (1,308 | ) | (810 | ) | ||||||||||||||||||||||||||||
| Core net interest income |
40,543 | 33,472 | 11,520 | 10,472 | 9,568 | 8,983 | 9,005 | |||||||||||||||||||||||||||||||||||
| Impact of securitizations (3) |
8,910 | 7,841 | 2,256 | 2,310 | 2,254 | 2,090 | 2,021 | |||||||||||||||||||||||||||||||||||
| Core net interest income - managed basis |
$ | 49,453 | $ | 41,313 | $ | 13,776 | $ | 12,782 | $ | 11,822 | $ | 11,073 | $ | 11,026 | ||||||||||||||||||||||||||||
| Average earning assets |
||||||||||||||||||||||||||||||||||||||||||
| As reported |
$ | 1,562,729 | $ | 1,390,192 | $ | 1,616,673 | $ | 1,622,466 | $ | 1,500,234 | $ | 1,510,295 | $ | 1,502,998 | ||||||||||||||||||||||||||||
| Impact of market-based earning assets (2) |
(368,751 | ) | (412,587 | ) | (318,818 | ) | (377,630 | ) | (375,274 | ) | (403,733 | ) | (407,315 | ) | ||||||||||||||||||||||||||||
| Core average earning assets |
1,193,978 | 977,605 | 1,297,855 | 1,244,836 | 1,124,960 | 1,106,562 | 1,095,683 | |||||||||||||||||||||||||||||||||||
| Impact of securitizations |
100,145 | 103,371 | 93,189 | 101,743 | 103,131 | 102,577 | 104,385 | |||||||||||||||||||||||||||||||||||
| Core average earning assets - managed basis |
$ | 1,294,123 | $ | 1,080,976 | $ | 1,391,044 | $ | 1,346,579 | $ | 1,228,091 | $ | 1,209,139 | $ | 1,200,068 | ||||||||||||||||||||||||||||
| Net interest yield contribution (1, 4) |
||||||||||||||||||||||||||||||||||||||||||
| As reported |
2.98 | % | 2.60 | % | 3.31 | % | 2.93 | % | 2.92 | % | 2.73 | % | 2.61 | % | ||||||||||||||||||||||||||||
| Impact of market-based activities (2) |
0.42 | 0.82 | 0.23 | 0.43 | 0.49 | 0.52 | 0.67 | |||||||||||||||||||||||||||||||||||
| Core net interest yield on earning assets |
3.40 | 3.42 | 3.54 | 3.36 | 3.41 | 3.25 | 3.28 | |||||||||||||||||||||||||||||||||||
| Impact of securitizations |
0.42 | 0.40 | 0.41 | 0.43 | 0.45 | 0.42 | 0.38 | |||||||||||||||||||||||||||||||||||
| Core net interest yield on earning assets - managed basis |
3.82 | % | 3.82 | % | 3.95 | % | 3.79 | % | 3.86 | % | 3.67 | % | 3.66 | % | ||||||||||||||||||||||||||||
| (1) | Fully taxable-equivalent basis |
| (2) | Represents the impact of market-based amounts included in the Capital Markets and Advisory Services business within Global Corporate and Investment Banking. For the year ended December 31, 2008 and 2007, the impact of market-based net interest income excludes $113 million and $70 million, and for the three months ended December 31, 2008, September 30, 2008, June 30, 2008, March 31, 2008 and December 31, 2007, respectively, excludes $36 million, $25 million, $25 million, $27 million and $26 million of net interest income on loans for which the fair value option has been elected and is not considered market-based income. |
| (3) | Represents the impact of securitizations utilizing actual bond costs. This is different from the segment view which utilizes funds transfer pricing methodologies. |
| (4) | Calculated on an annualized basis. |
Certain prior period amounts have been reclassified to conform to current period presentation.
| Information for periods beginning July 1, 2008 includes the Countrywide acquisition; prior periods have not been restated. This information is preliminary and based on company data available at the time of the presentation | 7 |
Bank of America Corporation and Subsidiaries
Quarterly Average Balances and Interest Rates - Fully Taxable-equivalent Basis
(Dollars in millions)
| Fourth Quarter 2008 | Third Quarter 2008 | Fourth Quarter 2007 | ||||||||||||||||||||||||||||
| Average Balance |
Interest Income/ Expense |
Yield/ Rate |
Average Balance |
Interest Income/ Expense |
Yield/ Rate |
Average Balance |
Interest Income/ Expense |
Yield/ Rate |
||||||||||||||||||||||
| Earning assets |
||||||||||||||||||||||||||||||
| Time deposits placed and other short-term investments |
$ | 10,511 | $ | 158 | 5.97 | % | $ | 11,361 | $ | 101 | 3.54 | % | $ | 10,459 | $ | 122 | 4.63 | % | ||||||||||||
| Federal funds sold and securities purchased under agreements to resell |
104,843 | 393 | 1.50 | 136,322 | 912 | 2.67 | 151,938 | 1,748 | 4.59 | |||||||||||||||||||||
| Trading account assets |
205,698 | 2,170 | 4.21 | 191,757 | 2,390 | 4.98 | 190,700 | 2,422 | 5.06 | |||||||||||||||||||||
| Debt securities (1) |
280,942 | 3,913 | 5.57 | 266,013 | 3,672 | 5.52 | 206,873 | 2,795 | 5.40 | |||||||||||||||||||||
| Loans and leases (2): |
||||||||||||||||||||||||||||||
| Residential mortgage |
253,468 | 3,581 | 5.65 | 260,748 | 3,712 | 5.69 | 277,058 | 3,972 | 5.73 | |||||||||||||||||||||
| Home equity |
152,035 | 1,969 | 5.17 | 151,142 | 2,124 | 5.59 | 112,369 | 2,043 | 7.21 | |||||||||||||||||||||
| Discontinued real estate |
21,324 | 459 | 8.60 | 22,031 | 399 | 7.25 | n/a | n/a | n/a | |||||||||||||||||||||
| Credit card - domestic |
64,906 | 1,784 | 10.94 | 63,414 | 1,682 | 10.55 | 60,063 | 1,781 | 11.76 | |||||||||||||||||||||
| Credit card - foreign |
17,211 | 521 | 12.05 | 17,075 | 535 | 12.47 | 14,329 | 464 | 12.86 | |||||||||||||||||||||
| Direct/Indirect consumer (3) |
83,331 | 1,714 | 8.18 | 85,392 | 1,790 | 8.34 | 75,138 | 1,658 | 8.75 | |||||||||||||||||||||
| Other consumer (4) |
3,544 | 70 | 7.83 | 3,723 | 80 | 8.78 | 4,206 | 71 | 6.77 | |||||||||||||||||||||
| Total consumer |
595,819 | 10,098 | 6.76 | 603,525 | 10,322 | 6.82 | 543,163 | 9,989 | 7.32 | |||||||||||||||||||||
| Commercial - domestic |
226,095 | 2,890 | 5.09 | 224,117 | 2,852 | 5.06 | 213,200 | 3,704 | 6.89 | |||||||||||||||||||||
| Commercial real estate (5) |
64,586 | 706 | 4.35 | 63,220 | 727 | 4.57 | 59,702 | 1,053 | 6.99 | |||||||||||||||||||||
| Commercial lease financing |
22,069 | 242 | 4.40 | 22,585 | 53 | 0.93 | 22,239 | 574 | 10.33 | |||||||||||||||||||||
| Commercial - foreign |
32,994 | 373 | 4.49 | 33,467 | 377 | 4.48 | 29,815 | 426 | 5.67 | |||||||||||||||||||||
| Total commercial |
345,744 | 4,211 | 4.85 | 343,389 | 4,009 | 4.64 | 324,956 | 5,757 | 7.03 | |||||||||||||||||||||
| Total loans and leases |
941,563 | 14,309 | 6.06 | 946,914 | 14,331 | 6.03 | 868,119 | 15,746 | 7.21 | |||||||||||||||||||||
| Other earning assets |
73,116 | 959 | 5.22 | 70,099 | 1,068 | 6.07 | 74,909 | 1,296 | 6.89 | |||||||||||||||||||||
| Total earning assets (6) |
1,616,673 | 21,902 | 5.40 | 1,622,466 | 22,474 | 5.52 | 1,502,998 | 24,129 | 6.39 | |||||||||||||||||||||
| Cash and cash equivalents |
77,388 | 36,030 | 33,714 | |||||||||||||||||||||||||||
| Other assets, less allowance for loan and lease losses |
254,793 | 247,195 | 205,755 | |||||||||||||||||||||||||||
| Total assets |
$ | 1,948,854 | $ | 1,905,691 | $ | 1,742,467 | ||||||||||||||||||||||||
| Interest-bearing liabilities |
||||||||||||||||||||||||||||||
| Domestic interest-bearing deposits: |
||||||||||||||||||||||||||||||
| Savings |
$ | 31,561 | $ | 58 | 0.73 | % | $ | 32,297 | $ | 58 | 0.72 | % | $ | 31,961 | $ | 50 | 0.63 | % | ||||||||||||
| NOW and money market deposit accounts |
285,390 | 813 | 1.13 | 278,520 | 973 | 1.39 | 240,914 | 1,334 | 2.20 | |||||||||||||||||||||
| Consumer CDs and IRAs |
229,410 | 1,835 | 3.18 | 218,862 | 1,852 | 3.37 | 183,910 | 2,179 | 4.70 | |||||||||||||||||||||
| Negotiable CDs, public funds and other time deposits |
36,510 | 270 | 2.94 | 36,039 | 291 | 3.21 | 34,997 | 420 | 4.76 | |||||||||||||||||||||
| Total domestic interest-bearing deposits |
582,871 | 2,976 | 2.03 | 565,718 | 3,174 | 2.23 | 491,782 | 3,983 | 3.21 | |||||||||||||||||||||
| Foreign interest-bearing deposits: |
||||||||||||||||||||||||||||||
| Banks located in foreign countries |
41,398 | 125 | 1.20 | 36,230 | 266 | 2.91 | 45,050 | 557 | 4.91 | |||||||||||||||||||||
| Governments and official institutions |
13,738 | 30 | 0.87 | 11,847 | 72 | 2.43 | 16,506 | 192 | 4.62 | |||||||||||||||||||||
| Time, savings and other |
48,836 | 165 | 1.34 | 48,209 | 334 | 2.76 | 51,919 | 521 | 3.98 | |||||||||||||||||||||
| Total foreign interest-bearing deposits |
103,972 | 320 | 1.22 | 96,286 | 672 | 2.78 | 113,475 | 1,270 | 4.44 | |||||||||||||||||||||
| Total interest-bearing deposits |
686,843 | 3,296 | 1.91 | 662,004 | 3,846 | 2.31 | 605,257 | 5,253 | 3.44 | |||||||||||||||||||||
| Federal funds purchased, securities sold under agreements to repurchase and other short-term borrowings |
459,743 | 1,910 | 1.65 | 465,511 | 3,223 | 2.76 | 456,530 | 5,598 | 4.87 | |||||||||||||||||||||
| Trading account liabilities |
70,859 | 524 | 2.94 | 77,271 | 661 | 3.40 | 81,500 | 825 | 4.02 | |||||||||||||||||||||
| Long-term debt |
255,709 | 2,766 | 4.32 | 264,934 | 2,824 | 4.26 | 196,444 | 2,638 | 5.37 | |||||||||||||||||||||
| Total interest-bearing liabilities (6) |
1,473,154 | 8,496 | 2.30 | 1,469,720 | 10,554 | 2.86 | 1,339,731 | 14,314 | 4.25 | |||||||||||||||||||||
| Noninterest-bearing sources: |
||||||||||||||||||||||||||||||
| Noninterest-bearing deposits |
205,298 | 195,841 | 176,368 | |||||||||||||||||||||||||||
| Other liabilities |
93,836 | 73,676 | 81,444 | |||||||||||||||||||||||||||
| Shareholders’ equity |
176,566 | 166,454 | 144,924 | |||||||||||||||||||||||||||
| Total liabilities and shareholders’ equity |
$ | 1,948,854 | $ | 1,905,691 | $ | 1,742,467 | ||||||||||||||||||||||||
| Net interest spread |
3.10 | % | 2.66 | % | 2.14 | % | ||||||||||||||||||||||||
| Impact of noninterest-bearing sources |
0.21 | 0.27 | 0.47 | |||||||||||||||||||||||||||
| Net interest income/yield on earning assets |
$ | 13,406 | 3.31 | % | $ | 11,920 | 2.93 | % | $ | 9,815 | 2.61 | % | ||||||||||||||||||
| (1) | Yields on AFS debt securities are calculated based on fair value rather than historical cost balances. The use of fair value does not have a material impact on net interest yield. |
| (2) | Nonperforming loans are included in the respective average loan balances. Income on these nonperforming loans is recognized on a cash basis. We account for acquired impaired loans in accordance with SOP 03-3. Loans accounted for in accordance with SOP 03-3 were written down to fair value upon acquisition and acrete interest income over the remaining life of the loan. |
| (3) | Includes foreign consumer loans of $2.0 billion and $2.6 billion in the fourth and third quarters of 2008, and $3.6 billion in the fourth quarter of 2007. |
| (4) | Includes consumer finance loans of $2.7 billion in both the fourth and third quarters of 2008, and $3.1 billion in the fourth quarter of 2007; and other foreign consumer loans of $654 million and $725 million in the fourth and third quarters of 2008, and $845 million in the fourth quarter of 2007. |
| (5) | Includes domestic commercial real estate loans of $63.6 billion and $62.2 billion in the fourth and third quarters of 2008, and $58.5 billion in the fourth quarter of 2007. |
| (6) | Interest income includes the impact of interest rate risk management contracts, which decreased interest income on the underlying assets $41 million and $12 million in the fourth and third quarters of 2008, and $134 million in the fourth quarter of 2007. Interest expense includes the impact of interest rate risk management contracts, which increased interest expense on the underlying liabilities $237 million and $86 million in the fourth and third quarters of 2008, and $201 million in the fourth quarter of 2007. |
Certain prior period amounts have been reclassified to conform to current period presentation.
| Information for periods beginning July 1, 2008 includes the Countrywide acquisition; prior periods have not been restated. This information is preliminary and based on company data available at the time of the presentation | 8 |
Bank of America Corporation and Subsidiaries
Quarterly Average Balances and Interest Rates - Fully Taxable-equivalent Basis - Isolating Hedge Income/Expense(1)
(Dollars in millions)
| Fourth Quarter 2008 | Third Quarter 2008 | Fourth Quarter 2007 | ||||||||||||||||||||||||||||||||||
| Average Balance |
Interest Income/ Expense |
Yield/ Rate |
Average Balance |
Interest Income/ Expense |
Yield/ Rate |
Average Balance |
Interest Income/ Expense |
Yield/ Rate |
||||||||||||||||||||||||||||
| Earning assets |
||||||||||||||||||||||||||||||||||||
| Time deposits placed and other short-term investments (2) |
$ | 10,511 | $ | 162 | 6.13 | % | $ | 11,361 | $ | 105 | 3.68 | % | $ | 10,459 | $ | 126 | 4.79 | % | ||||||||||||||||||
| Federal funds sold and securities purchased under agreements to resell (2) |
104,843 | 414 | 1.57 | 136,322 | 948 | 2.78 | 151,938 | 1,843 | 4.84 | |||||||||||||||||||||||||||
| Trading account assets |
205,698 | 2,170 | 4.21 | 191,757 | 2,390 | 4.98 | 190,700 | 2,422 | 5.06 | |||||||||||||||||||||||||||
| Debt securities (2) |
280,942 | 3,928 | 5.59 | 266,013 | 3,675 | 5.52 | 206,873 | 2,795 | 5.40 | |||||||||||||||||||||||||||
| Loans and leases: |
||||||||||||||||||||||||||||||||||||
| Residential mortgage |
253,468 | 3,581 | 5.65 | 260,748 | 3,712 | 5.69 | 277,058 | 3,972 | 5.73 | |||||||||||||||||||||||||||
| Home equity |
152,035 | 1,969 | 5.17 | 151,142 | 2,124 | 5.59 | 112,369 | 2,043 | 7.21 | |||||||||||||||||||||||||||
| Discontinued real estate |
21,324 | 459 | 8.60 | 22,031 | 399 | 7.25 | n/a | n/a | n/a | |||||||||||||||||||||||||||
| Credit card - domestic |
64,906 | 1,784 | 10.94 | 63,414 | 1,682 | 10.55 | 60,063 | 1,781 | 11.76 | |||||||||||||||||||||||||||
| Credit card - foreign |
17,211 | 521 | 12.05 | 17,075 | 535 | 12.47 | 14,329 | 464 | 12.86 | |||||||||||||||||||||||||||
| Direct/Indirect consumer |
83,331 | 1,714 | 8.18 | 85,392 | 1,790 | 8.34 | 75,138 | 1,658 | 8.75 | |||||||||||||||||||||||||||
| Other consumer |
3,544 | 70 | 7.83 | 3,723 | 80 | 8.78 | 4,206 | 71 | 6.77 | |||||||||||||||||||||||||||
| Total consumer |
595,819 | 10,098 | 6.76 | 603,525 | 10,322 | 6.82 | 543,163 | 9,989 | 7.32 | |||||||||||||||||||||||||||
| Commercial - domestic (2) |
226,095 | 2,893 | 5.09 | 224,117 | 2,820 | 5.01 | 213,200 | 3,731 | 6.94 | |||||||||||||||||||||||||||
| Commercial real estate |
64,586 | 706 | 4.35 | 63,220 | 727 | 4.57 | 59,702 | 1,053 | 6.99 | |||||||||||||||||||||||||||
| Commercial lease financing |
22,069 | 242 | 4.40 | 22,585 | 53 | 0.93 | 22,239 | 574 | 10.33 | |||||||||||||||||||||||||||
| Commercial - foreign (2) |
32,994 | 373 | 4.49 | 33,467 | 377 | 4.48 | 29,815 | 425 | 5.67 | |||||||||||||||||||||||||||
| Total commercial |
345,744 | 4,214 | 4.85 | 343,389 | 3,977 | 4.61 | 324,956 | 5,783 | 7.07 | |||||||||||||||||||||||||||
| Total loans and leases |
941,563 | 14,312 | 6.06 | 946,914 | 14,299 | 6.02 | 868,119 | 15,772 | 7.22 | |||||||||||||||||||||||||||
| Other earning assets (2) |
73,116 | 957 | 5.22 | 70,099 | 1,069 | 6.07 | 74,909 | 1,305 | 6.93 | |||||||||||||||||||||||||||
| Total earning assets - excluding hedge impact |
1,616,673 | 21,943 | 5.41 | 1,622,466 | 22,486 | 5.53 | 1,502,998 | 24,263 | 6.43 | |||||||||||||||||||||||||||
| Net hedge income (expense) on assets |
(41 | ) | (12 | ) | (134 | ) | ||||||||||||||||||||||||||||||
| Total earning assets - including hedge impact |
1,616,673 | 21,902 | 5.40 | 1,622,466 | 22,474 | 5.52 | 1,502,998 | 24,129 | 6.39 | |||||||||||||||||||||||||||
| Cash and cash equivalents |
77,388 | 36,030 | 33,714 | |||||||||||||||||||||||||||||||||
| Other assets, less allowance for loan and lease losses |
254,793 | 247,195 | 205,755 | |||||||||||||||||||||||||||||||||
| Total assets |
$ | 1,948,854 | $ | 1,905,691 | $ | 1,742,467 | ||||||||||||||||||||||||||||||
| Interest-bearing liabilities |
||||||||||||||||||||||||||||||||||||
| Domestic interest-bearing deposits: |
||||||||||||||||||||||||||||||||||||
| Savings |
$ | 31,561 | $ | 58 | 0.73 | % | $ | 32,297 | $ | 58 | 0.72 | % | $ | 31,961 | $ | 50 | 0.63 | % | ||||||||||||||||||
| NOW and money market deposit accounts (2) |
285,390 | 813 | 1.13 | 278,520 | 973 | 1.39 | 240,914 | 1,329 | 2.19 | |||||||||||||||||||||||||||
| Consumer CDs and IRAs (2) |
229,410 | 1,765 | 3.06 | 218,862 | 1,765 | 3.21 | 183,910 | 2,033 | 4.38 | |||||||||||||||||||||||||||
| Negotiable CDs, public funds and other time deposits (2) |
36,510 | 267 | 2.90 | 36,039 | 288 | 3.18 | 34,997 | 418 | 4.73 | |||||||||||||||||||||||||||
| Total domestic interest-bearing deposits |
582,871 | 2,903 | 1.98 | 565,718 | 3,084 | 2.17 | 491,782 | 3,830 | 3.09 | |||||||||||||||||||||||||||
| Foreign interest-bearing deposits: |
||||||||||||||||||||||||||||||||||||
| Banks located in foreign countries (2) |
41,398 | 119 | 1.14 | 36,230 | 279 | 3.07 | 45,050 | 553 | 4.87 | |||||||||||||||||||||||||||
| Governments and official institutions |
13,738 | 30 | 0.87 | 11,847 | 72 | 2.43 | 16,506 | 192 | 4.62 | |||||||||||||||||||||||||||
| Time, savings and other |
48,836 | 165 | 1.34 | 48,209 | 334 | 2.76 | 51,919 | 521 | 3.98 | |||||||||||||||||||||||||||
| Total foreign interest-bearing deposits |
103,972 | 314 | 1.20 | 96,286 | 685 | 2.84 | 113,475 | 1,266 | 4.43 | |||||||||||||||||||||||||||
| Total interest-bearing deposits |
686,843 | 3,217 | 1.86 | 662,004 | 3,769 | 2.27 | 605,257 | 5,096 | 3.34 | |||||||||||||||||||||||||||
| Federal funds purchased, securities sold under agreements to repurchase and other short-term borrowings (2) |
459,743 | 1,549 | 1.34 | 465,511 | 2,938 | 2.51 | 456,530 | 5,638 | 4.90 | |||||||||||||||||||||||||||
| Trading account liabilities |
70,859 | 524 | 2.94 | 77,271 | 661 | 3.40 | 81,500 | 825 | 4.02 | |||||||||||||||||||||||||||
| Long-term debt (2) |
255,709 | 2,969 | 4.64 | 264,934 | 3,100 | 4.68 | 196,444 | 2,554 | 5.20 | |||||||||||||||||||||||||||
| Total interest-bearing liabilities - excluding hedge impact |
1,473,154 | 8,259 | 2.23 | 1,469,720 | 10,468 | 2.84 | 1,339,731 | 14,113 | 4.19 | |||||||||||||||||||||||||||
| Net hedge (income) expense on liabilities |
237 | 86 | 201 | |||||||||||||||||||||||||||||||||
| Total interest-bearing liabilities - including hedge impact |
1,473,154 | 8,496 | 2.30 | 1,469,720 | 10,554 | 2.86 | 1,339,731 | 14,314 | 4.25 | |||||||||||||||||||||||||||
| Noninterest-bearing sources: |
||||||||||||||||||||||||||||||||||||
| Noninterest-bearing deposits |
205,298 | 195,841 | 176,368 | |||||||||||||||||||||||||||||||||
| Other liabilities |
93,836 | 73,676 | 81,444 | |||||||||||||||||||||||||||||||||
| Shareholders’ equity |
176,566 | 166,454 | 144,924 | |||||||||||||||||||||||||||||||||
| Total liabilities and shareholders’ equity |
$ | 1,948,854 | $ | 1,905,691 | $ | 1,742,467 | ||||||||||||||||||||||||||||||
| Net interest spread |
3.18 | 2.69 | 2.24 | |||||||||||||||||||||||||||||||||
| Impact of noninterest-bearing sources |
0.21 | 0.27 | 0.47 | |||||||||||||||||||||||||||||||||
| Net interest income/yield on earning assets - excluding hedge impact |
$ | 13,684 | 3.39 | % | $ | 12,018 | 2.96 | % | $ | 10,150 | 2.71 | % | ||||||||||||||||||||||||
| Net impact of hedge income (expense) |
(278 | ) | (0.08 | ) | (98 | ) | (0.03 | ) | (335 | ) | (0.10 | ) | ||||||||||||||||||||||||
| Net interest income/yield on earning assets |
$ | 13,406 | 3.31 | % | $ | 11,920 | 2.93 | % | $ | 9,815 | 2.61 | % | ||||||||||||||||||||||||
| (1) | This table presents a non-GAAP financial measure. The impact of interest rate risk management derivatives is shown separately. Interest income and interest expense amounts, and the yields and rates have been adjusted. Management believes this presentation is useful to investors because it adjusts for the impact of our hedging decisions and provides a better understanding of our hedging activities. The impact of interest rate risk management derivatives is not material to the average balances presented above. |
| (2) | The following presents the impact of interest rate risk management derivatives on interest income and interest expense. |
Interest income excludes the impact of interest rate risk management contracts, which increased (decreased) interest income on:
| Fourth Quarter 2008 | Third Quarter 2008 | Fourth Quarter 2007 | ||||||||||||
| Time deposits placed and other short-term investments |
$ | (4 | ) | $ | (4 | ) | $ | (4 | ) | |||||
| Federal funds sold and securities purchased under agreements to resell |
(21 | ) | (36 | ) | (95 | ) | ||||||||
| Debt securities |
(15 | ) | (3 | ) | — | |||||||||
| Commercial - domestic |
(3 | ) | 32 | (27 | ) | |||||||||
| Commercial - foreign |
— | — | 1 | |||||||||||
| Other earning assets |
2 | (1 | ) | (9 | ) | |||||||||
| Net hedge income (expense) on assets |
$ | (41 | ) | $ | (12 | ) | $ | (134 | ) | |||||
| Interest expense excludes the impact of interest rate risk management contracts, which increased (decreased) interest expense on: | ||||||||||||||
| NOW and money market deposit accounts |
$ | — | $ | — | $ | 5 | ||||||||
| Consumer CDs and IRAs |
70 | 87 | 146 | |||||||||||
| Negotiable CDs, public funds and other time deposits |
3 | 3 | 2 | |||||||||||
| Banks located in foreign countries |
6 | (13 | ) | 4 | ||||||||||
| Federal funds purchased, securities sold under agreements to repurchase and other short-term borrowings |
361 | 285 | (40 | ) | ||||||||||
| Long-term debt |
(203 | ) | (276 | ) | 84 | |||||||||
| Net hedge (income) expense on liabilities |
$ | 237 | $ | 86 | $ | 201 | ||||||||
Certain prior period amounts have been reclassified to conform to current period presentation.
| Information for periods beginning July 1, 2008 includes the Countrywide acquisition; prior periods have not been restated. This information is preliminary and based on company data available at the time of the presentation | 9 |
Bank of America Corporation and Subsidiaries
Year-to-Date Average Balances and Interest Rates - Fully Taxable-equivalent Basis
(Dollars in millions)
| Year Ended December 31 | ||||||||||||||||||||
| 2008 | 2007 | |||||||||||||||||||
| Average Balance |
Interest Income/ Expense |
Yield/ Rate |
Average Balance |
Interest Income/ Expense |
Yield/ Rate |
|||||||||||||||
| Earning assets |
||||||||||||||||||||
| Time deposits placed and other short-term investments |
$ | 10,696 | $ | 440 | 4.11 | % | $ | 13,152 | $ | 627 | 4.77 | % | ||||||||
| Federal funds sold and securities purchased under agreements to resell |
128,053 | 3,313 | 2.59 | 155,828 | 7,722 | 4.96 | ||||||||||||||
| Trading account assets |
193,631 | 9,259 | 4.78 | 187,287 | 9,747 | 5.20 | ||||||||||||||
| Debt securities (1) |
250,551 | 13,383 | 5.34 | 186,466 | 10,020 | 5.37 | ||||||||||||||
| Loans and leases (2): |
||||||||||||||||||||
| Residential mortgage |
260,213 | 14,671 | 5.64 | 264,650 | 15,112 | 5.71 | ||||||||||||||
| Home equity |
135,091 | 7,592 | 5.62 | 98,765 | 7,385 | 7.48 | ||||||||||||||
| Discontinued real estate |
10,898 | 858 | 7.87 | n/a | n/a | n/a | ||||||||||||||
| Credit card - domestic |
63,318 | 6,843 | 10.81 | 57,883 | 7,225 | 12.48 | ||||||||||||||
| Credit card - foreign |
16,527 | 2,042 | 12.36 | 12,359 | 1,502 | 12.15 | ||||||||||||||
| Direct/Indirect consumer (3) |
82,516 | 6,934 | 8.40 | 70,009 | 6,002 | 8.57 | ||||||||||||||
| Other consumer (4) |
3,816 | 321 | 8.41 | 4,510 | 389 | 8.64 | ||||||||||||||
| Total consumer |
572,379 | 39,261 | 6.86 | 508,176 | 37,615 | 7.40 | ||||||||||||||
| Commercial - domestic |
220,561 | 11,702 | 5.31 | 180,102 | 12,884 | 7.15 | ||||||||||||||
| Commercial real estate (5) |
63,208 | 3,057 | 4.84 | 42,950 | 3,145 | 7.32 | ||||||||||||||
| Commercial lease financing |
22,290 | 799 | 3.58 | 20,435 | 1,212 | 5.93 | ||||||||||||||
| Commercial - foreign |
32,440 | 1,503 | 4.63 | 24,491 | 1,452 | 5.93 | ||||||||||||||
| Total commercial |
338,499 | 17,061 | 5.04 | 267,978 | 18,693 | 6.98 | ||||||||||||||
| Total loans and leases |
910,878 | 56,322 | 6.18 | 776,154 | 56,308 | 7.25 | ||||||||||||||
| Other earning assets |
68,920 | 4,161 | 6.04 | 71,305 | 4,629 | 6.49 | ||||||||||||||
| Total earning assets (6) |
1,562,729 | 86,878 | 5.56 | 1,390,192 | 89,053 | 6.41 | ||||||||||||||
| Cash and cash equivalents |
45,354 | 33,091 | ||||||||||||||||||
| Other assets, less allowance for loan and lease losses |
235,896 | 178,790 | ||||||||||||||||||
| Total assets |
$ | 1,843,979 | $ | 1,602,073 | ||||||||||||||||
| Interest-bearing liabilities |
||||||||||||||||||||
| Domestic interest-bearing deposits: |
||||||||||||||||||||
| Savings |
$ | 32,204 | $ | 230 | 0.71 | % | $ | 32,316 | $ | 188 | 0.58 | % | ||||||||
| NOW and money market deposit accounts |
267,818 | 3,781 | 1.41 | 220,207 | 4,361 | 1.98 | ||||||||||||||
| Consumer CDs and IRAs |
203,887 | 7,404 | 3.63 | 167,801 | 7,817 | 4.66 | ||||||||||||||
| Negotiable CDs, public funds and other time deposits |
32,264 | 1,076 | 3.33 | 20,557 | 974 | 4.74 | ||||||||||||||
| Total domestic interest-bearing deposits |
536,173 | 12,491 | 2.33 | 440,881 | 13,340 | 3.03 | ||||||||||||||
| Foreign interest-bearing deposits: |
||||||||||||||||||||
| Banks located in foreign countries |
37,657 | 1,063 | 2.82 | 42,788 | 2,174 | 5.08 | ||||||||||||||
| Governments and official institutions |
13,004 | 311 | 2.39 | 16,523 | 812 | 4.91 | ||||||||||||||
| Time, savings and other |
51,363 | 1,385 | 2.70 | 43,443 | 1,767 | 4.07 | ||||||||||||||
| Total foreign interest-bearing deposits |
102,024 | 2,759 | 2.70 | 102,754 | 4,753 | 4.63 | ||||||||||||||
| Total interest-bearing deposits |
638,197 | 15,250 | 2.39 | 543,635 | 18,093 | 3.33 | ||||||||||||||
| Federal funds purchased, securities sold under agreements to repurchase and other short-term borrowings |
455,710 | 12,362 | 2.71 | 424,814 | 21,967 | 5.17 | ||||||||||||||
| Trading account liabilities |
75,270 | 2,774 | 3.69 | 82,721 | 3,444 | 4.16 | ||||||||||||||
| Long-term debt |
231,235 | 9,938 | 4.30 | 169,855 | 9,359 | 5.51 | ||||||||||||||
| Total interest-bearing liabilities (6) |
1,400,412 | 40,324 | 2.88 | 1,221,025 | 52,863 | 4.33 | ||||||||||||||
| Noninterest-bearing sources: |
||||||||||||||||||||
| Noninterest-bearing deposits |
192,947 | 173,547 | ||||||||||||||||||
| Other liabilities |
85,789 | 70,839 | ||||||||||||||||||
| Shareholders’ equity |
164,831 | 136,662 | ||||||||||||||||||
| Total liabilities and shareholders’ equity |
$ | 1,843,979 | $ | 1,602,073 | ||||||||||||||||
| Net interest spread |
2.68 | % | 2.08 | % | ||||||||||||||||
| Impact of noninterest-bearing sources |
0.30 | 0.52 | ||||||||||||||||||
| Net interest income/yield on earning assets |
$ | 46,554 | 2.98 | % | $ | 36,190 | 2.60 | % | ||||||||||||
| (1) | Yields on AFS debt securities are calculated based on fair value rather than historical cost balances. The use of fair value does not have a material impact on net interest yield. |
| (2) | Nonperforming loans are included in the respective average loan balances. Income on these nonperforming loans is recognized on a cash basis. We account for acquired impaired loans in accordance with SOP 03-3. Loans accounted for in accordance with SOP 03-3 were written down to fair value upon acquisition and acrete interest income over the remaining life of the loan. |
| (3) | Includes foreign consumer loans of $2.7 billion and $3.8 billion for the year ended December 31, 2008 and 2007. |
| (4) | Includes consumer finance loans of $2.8 billion and $3.2 billion, and other foreign consumer loans of $774 million and $1.1 billion for the year ended December 31, 2008 and 2007. |
| (5) | Includes domestic commercial real estate loans of $62.1 billion and $42.1 billion for the year ended December 31, 2008 and 2007. |
| (6) | Interest income includes the impact of interest rate risk management contracts, which decreased interest income on the underlying assets $260 million and $542 million for the year ended December 31, 2008 and 2007. Interest expense includes the impact of interest rate risk management contracts, which increased interest expense on the underlying liabilities $409 million and $813 million for the year ended December 31, 2008 and 2007. |
Certain prior period amounts have been reclassified to conform to current period presentation.
| Information for periods beginning July 1, 2008 includes the Countrywide acquisition; prior periods have not been restated. This information is preliminary and based on company data available at the time of the presentation | 10 |
Bank of America Corporation and Subsidiaries
Year-to-Date Average Balances and Interest Rates - Fully Taxable-equivalent Basis - Isolating Hedge Income/Expense (1)
(Dollars in millions)
| Year Ended December 31 | ||||||||||||||||||||||||
| 2008 | 2007 | |||||||||||||||||||||||
| Average Balance |
Interest Income/ Expense |
Yield/ Rate |
Average Balance |
Interest Income/ Expense |
Yield/ Rate |
|||||||||||||||||||
| Earning assets |
||||||||||||||||||||||||
| Time deposits placed and other short-term investments (2) |
$ | 10,696 | $ | 456 | 4.26 | % | $ | 13,152 | $ | 672 | 5.11 | % | ||||||||||||
| Federal funds sold and securities purchased under agreements to resell (2) |
128,053 | 3,507 | 2.74 | 155,828 | 8,120 | 5.21 | ||||||||||||||||||
| Trading account assets |
193,631 | 9,259 | 4.78 | 187,287 | 9,747 | 5.20 | ||||||||||||||||||
| Debt securities (2) |
250,551 | 13,402 | 5.35 | 186,466 | 10,036 | 5.38 | ||||||||||||||||||
| Loans and leases: |
||||||||||||||||||||||||
| Residential mortgage |
260,213 | 14,671 | 5.64 | 264,650 | 15,112 | 5.71 | ||||||||||||||||||
| Home equity |
135,091 | 7,592 | 5.62 | 98,765 | 7,385 | 7.48 | ||||||||||||||||||
| Discontinued real estate |
10,898 | 858 | 7.87 | n/a | n/a | n/a | ||||||||||||||||||
| Credit card- domestic |
63,318 | 6,843 | 10.81 | 57,883 | 7,225 | 12.48 | ||||||||||||||||||
| Credit card - foreign |
16,527 | 2,042 | 12.36 | 12,359 | 1,502 | 12.15 | ||||||||||||||||||
| Direct/Indirect consumer |
82,516 | 6,934 | 8.40 | 70,009 | 6,002 | 8.57 | ||||||||||||||||||
| Other consumer |
3,816 | 321 | 8.41 | 4,510 | 389 | 8.64 | ||||||||||||||||||
| Total consumer |
572,379 | 39,261 | 6.86 | 508,176 | 37,615 | 7.40 | ||||||||||||||||||
| Commercial - domestic (2) |
220,561 | 11,733 | 5.32 | 180,102 | 12,932 | 7.18 | ||||||||||||||||||
| Commercial real estate |
63,208 | 3,057 | 4.84 | 42,950 | 3,145 | 7.32 | ||||||||||||||||||
| Commercial lease financing |
22,290 | 799 | 3.58 | 20,435 | 1,212 | 5.93 | ||||||||||||||||||
| Commercial - foreign (2) |
32,440 | 1,503 | 4.63 | 24,491 | 1,450 | 5.92 | ||||||||||||||||||
| Total commercial |
338,499 | 17,092 | 5.05 | 267,978 | 18,739 | 6.99 | ||||||||||||||||||
| Total loans and leases |
910,878 | 56,353 | 6.19 | 776,154 | 56,354 | 7.26 | ||||||||||||||||||
| Other earning assets (2) |
68,920 | 4,161 | 6.04 | 71,305 | 4,666 | 6.54 | ||||||||||||||||||
| Total earning assets - excluding hedge impact |
1,562,729 | 87,138 | 5.58 | 1,390,192 | 89,595 | 6.44 | ||||||||||||||||||
| Net hedge income (expense) on assets |
(260 | ) | (542 | ) | ||||||||||||||||||||
| Total earning assets - including hedge impact |
1,562,729 | 86,878 | 5.56 | 1,390,192 | 89,053 | 6.41 | ||||||||||||||||||
| Cash and cash equivalents |
45,354 | 33,091 | ||||||||||||||||||||||
| Other assets, less allowance for loan and lease losses |
235,896 | 178,790 | ||||||||||||||||||||||
| Total assets |
$ | 1,843,979 | $ | 1,602,073 | ||||||||||||||||||||
| Interest-bearing liabilities |
||||||||||||||||||||||||
| Domestic interest-bearing deposits: |
||||||||||||||||||||||||
| Savings |
$ | 32,204 | $ | 230 | 0.71 | % | $ | 32,316 | $ | 188 | 0.58 | % | ||||||||||||
| NOW and money market deposit accounts (2) |
267,818 | 3,771 | 1.41 | 220,207 | 4,342 | 1.97 | ||||||||||||||||||
| Consumer CDs and IRAs (2) |
203,887 | 7,015 | 3.44 | 167,801 | 7,167 | 4.27 | ||||||||||||||||||
| Negotiable CDs, public funds and other time deposits (2) |
32,264 | 1,066 | 3.30 | 20,557 | 965 | 4.69 | ||||||||||||||||||
| Total domestic interest-bearing deposits |
536,173 | 12,082 | 2.25 | 440,881 | 12,662 | 2.87 | ||||||||||||||||||
| Foreign interest-bearing deposits: |
||||||||||||||||||||||||
| Banks located in foreign countries (2) |
37,657 | 1,068 | 2.84 | 42,788 | 2,168 | 5.07 | ||||||||||||||||||
| Governments and official institutions |
13,004 | 311 | 2.39 | 16,523 | 812 | 4.91 | ||||||||||||||||||
| Time, savings and other |
51,363 | 1,385 | 2.70 | 43,443 | 1,767 | 4.07 | ||||||||||||||||||
| Total foreign interest-bearing deposits |
102,024 | 2,764 | 2.71 | 102,754 | 4,747 | 4.62 | ||||||||||||||||||
| Total interest-bearing deposits |
638,197 | 14,846 | 2.33 | 543,635 | 17,409 | 3.20 | ||||||||||||||||||
| Federal funds purchased, securities sold under agreements to repurchase and other short-term borrowings (2) |
455,710 | 11,601 | 2.55 | 424,814 | 22,309 | 5.25 | ||||||||||||||||||
| Trading account liabilities |
75,270 | 2,774 | 3.69 | 82,721 | 3,444 | 4.16 | ||||||||||||||||||
| Long-term debt (2) |
231,235 | 10,694 | 4.62 | 169,855 | 8,888 | 5.23 | ||||||||||||||||||
| Total interest-bearing liabilities - excluding hedge impact |
1,400,412 | 39,915 | 2.85 | 1,221,025 | 52,050 | 4.26 | ||||||||||||||||||
| Net hedge (income) expense on liabilities |
409 | 813 | ||||||||||||||||||||||
| Total interest-bearing liabilities - including hedge impact |
1,400,412 | 40,324 | 2.88 | 1,221,025 | 52,863 | 4.33 | ||||||||||||||||||
| Noninterest-bearing sources: |
||||||||||||||||||||||||
| Noninterest-bearing deposits |
192,947 | 173,547 | ||||||||||||||||||||||
| Other liabilities |
85,789 | 70,839 | ||||||||||||||||||||||
| Shareholders’ equity |
164,831 | 136,662 | ||||||||||||||||||||||
| Total liabilities and shareholders’ equity |
$ | 1,843,979 | $ | 1,602,073 | ||||||||||||||||||||
| Net interest spread |
2.73 | 2.18 | ||||||||||||||||||||||
| Impact of noninterest-bearing sources |
0.30 | 0.52 | ||||||||||||||||||||||
| Net interest income/yield on earning assets - excluding hedge impact |
$ | 47,223 | 3.03 | % | $ | 37,545 | 2.70 | % | ||||||||||||||||
| Net impact of hedge income (expense) |
(669 | ) | (0.05 | ) | (1,355 | ) | (0.10 | ) | ||||||||||||||||
| Net interest income/yield on earning assets |
$ | 46,554 | 2.98 | % | $ | 36,190 | 2.60 | % | ||||||||||||||||
| (1) | This table presents a non-GAAP financial measure. The impact of interest rate risk management derivatives is shown separately. Interest income and interest expense amounts, and the yields and rates have been adjusted. Management believes this presentation is useful to investors because it adjusts for the impact of our hedging decisions and provides a better understanding of our hedging activities. The impact of interest rate risk management derivatives is not material to the average balances presented above. |
| (2) | The following presents the impact of interest rate risk management derivatives on interest income and interest expense. |
Interest income excludes the impact of interest rate risk management contracts, which increased (decreased) interest income on:
| Year Ended December 31 | ||||||||||
| 2008 | 2007 | |||||||||
| Time deposits placed and other short-term investments |
$ | (16 | ) | &n | ||||||