Bank of America Corporation Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Shareholders' Equity

Shareholders' Equity

12 Months Ended

Dec. 31, 2018

Equity [Abstract]

Shareholders' Equity

Shareholders’ Equity

Common Stock




Declared Quarterly Cash Dividends on Common Stock ⁽¹⁾

Declaration Date	Record Date	Payment Date	Dividend Per Share
January 30, 2019	March 1, 2019	March 29, 2019	$	0.15
October 24, 2018	December 7, 2018	December 28, 2018	0.15
July 26, 2018	September 7, 2018	September 28, 2018	0.15
April 25, 2018	June 1, 2018	June 29, 2018	0.12
January 31, 2018	March 2, 2018	March 30, 2018	0.12


⁽¹⁾	In 2018, and through February 26, 2019.

The cash dividends paid per share of common stock were $0.54, $0.39 and $0.25 for 2018, 2017 and 2016, respectively.

The following table summarizes common stock repurchases during 2018, 2017 and 2016.




Common Stock Repurchase Summary

(in millions)	2018		2017		2016
Total share repurchases, including CCAR capital plan repurchases	676		509		333

Purchase price of shares repurchased and retired ⁽¹⁾
CCAR capital plan repurchases	$	16,754	$	9,347	$	4,312
Other authorized repurchases	3,340		3,467		800
Total shares repurchased	$	20,094	$	12,814	$	5,112


⁽¹⁾	Represents reductions to shareholders’ equity due to common stock repurchases.

On June 28, 2018, following the non-objection of the Board of Governors of the Federal Reserve System (Federal Reserve) to the Corporation’s 2018 Comprehensive Capital Analysis and Review (CCAR) capital plan, the Board of Directors (Board) authorized the repurchase of approximately $20.6 billion in common stock from July 1, 2018 through June 30, 2019, which includes approximately $600 million in repurchases to offset shares awarded under equity-based compensation plans during the same period. The common stock repurchase authorization includes both common stock and warrants.

During 2018, the Corporation repurchased $20.1 billion of common stock in connection with the 2018 and 2017 CCAR capital plans and pursuant to a December 5, 2017 authorization to repurchase an additional $5.0 billion in common stock.

At December 31, 2018, the Corporation had warrants outstanding and exercisable to purchase 121 million shares of common stock. These warrants, substantially all of which were exercised on or before the expiration date of January 16, 2019, were originally issued in connection with a preferred stock issuance to the U.S. Department of the Treasury in 2009 and were listed on the New York Stock Exchange.

On August 24, 2017, the holders of the Corporation’s Series T 6% Non-cumulative preferred stock (Series T) exercised warrants to acquire 700 million shares of the Corporation’s common stock. The carrying value of the preferred stock was $2.9 billion and, upon conversion, was recorded as additional paid-in capital. For more information, see Note 15 – Earnings Per Common Share.

In connection with employee stock plans, in 2018, the Corporation issued 75 million shares of its common stock and, to

satisfy tax withholding obligations, repurchased 29 million shares of its common stock. At December 31, 2018, the Corporation had reserved 781 million unissued shares of common stock for future issuances under employee stock plans, common stock warrants, convertible notes and preferred stock.

Preferred Stock

The cash dividends declared on preferred stock were $1.5 billion, $1.6 billion and $1.7 billion for 2018, 2017 and 2016, respectively.

On March 15, 2018, the Corporation issued 94,000 shares of 5.875% Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series FF for $2.35 billion. On May 16, 2018, the Corporation issued 54,000 shares of 6.000% Fixed Rate Non-Cumulative Preferred Stock, Series GG for $1.35 billion. On July 24, 2018, the Corporation issued 34,160 shares of 5.875% Non-Cumulative Preferred Stock, Series HH for $854 million.

In 2018, the Corporation fully redeemed Series D, Series I, Series K, Series M and Series 3 preferred stock for a total of $4.5 billion.

All series of preferred stock in the Preferred Stock Summary table have a par value of $0.01 per share, are not subject to the operation of a sinking fund, have no participation rights, and with the exception of the Series L Preferred Stock, are not convertible. The holders of the Series B Preferred Stock and Series 1 through 5 Preferred Stock have general voting rights and vote together with the common stock. The holders of the other series included in the table have no general voting rights. All outstanding series of preferred stock of the Corporation have preference over the Corporation’s common stock with respect to the payment of dividends and distribution of the Corporation’s assets in the event of a liquidation or dissolution. With the exception of the Series B, F, G and T Preferred Stock, if any dividend payable on these series is in arrears for three or more semi-annual or six or more quarterly dividend periods, as applicable (whether consecutive or not), the holders of these series and any other class or series of preferred stock ranking equally as to payment of dividends and upon which equivalent voting rights have been conferred and are exercisable (voting as a single class) will be entitled to vote for the election of two additional directors. These voting rights terminate when the Corporation has paid in full dividends on these series for at least two semi-annual or four quarterly dividend periods, as applicable, following the dividend arrearage.

The 7.25% Non-Cumulative Perpetual Convertible Preferred Stock, Series L (Series L Preferred Stock) does not have early redemption/call rights. Each share of the Series L Preferred Stock may be converted at any time, at the option of the holder, into 20 shares of the Corporation’s common stock plus cash in lieu of fractional shares. The Corporation may cause some or all of the Series L Preferred Stock, at its option, at any time or from time to time, to be converted into shares of common stock at the then-applicable conversion rate if, for 20 trading days during any period of 30 consecutive trading days, the closing price of common stock exceeds 130 percent of the then-applicable conversion price of the Series L Preferred Stock. If a conversion of Series L Preferred Stock occurs at the option of the holder, subsequent to a dividend record date but prior to the dividend payment date, the Corporation will still pay any accrued dividends payable.

The table on the following page presents a summary of perpetual preferred stock outstanding at December 31, 2018.




Preferred Stock Summary

(Dollars in millions, except as noted)
Series	Description	Initial Issuance Date	Total Shares Outstanding	Liquidation Preference per Share (in dollars)		Carrying Value			Per Annum Dividend Rate		Dividend per Share (in dollars)		Annual Dividend		Redemption Period ⁽¹⁾
Series B	7% Cumulative Redeemable	June 1997	7,110	$	100	$	1		7.00	%	$	7.00	$	—	n/a
Series E ⁽²⁾	Floating Rate Non-Cumulative	November 2006	12,691	25,000		317			3-mo. LIBOR + 35 bps ⁽³⁾		1.01		13		On or after November 15, 2011
Series F	Floating Rate Non-Cumulative	March 2012	1,409	100,000		141			3-mo. LIBOR + 40 bps ⁽³⁾		4,055.56		6		On or after March 15, 2012
Series G	Adjustable Rate Non-Cumulative	March 2012	4,926	100,000		493			3-mo. LIBOR + 40 bps ⁽³⁾		4,055.56		20		On or after March 15, 2012
Series L	7.25% Non-Cumulative Perpetual Convertible	January 2008	3,080,182	1,000		3,080			7.25	%	72.50		223		n/a
Series T	6% Non-cumulative	September 2011	354	100,000		35			6.00	%	6,000.00		2		After May 7, 2019
Series U ⁽⁴⁾	Fixed-to-Floating Rate Non-Cumulative	May 2013	40,000	25,000		1,000			5.2% to, but excluding, 6/1/23; 3-mo. LIBOR + 313.5 bps thereafter		52.00		52		On or after June 1, 2023
Series V ⁽⁴⁾	Fixed-to-Floating Rate Non-Cumulative	June 2014	60,000	25,000		1,500			5.125% to, but excluding, 6/17/19; 3-mo. LIBOR + 338.7 bps thereafter		51.25		77		On or after June 17, 2019
Series W ⁽²⁾	6.625% Non-Cumulative	September 2014	44,000	25,000		1,100			6.625	%	1.66		73		On or after September 9, 2019
Series X ⁽⁴⁾	Fixed-to-Floating Rate Non-Cumulative	September 2014	80,000	25,000		2,000			6.250% to, but excluding, 9/5/24; 3-mo. LIBOR + 370.5 bps thereafter		62.50		125		On or after September 5, 2024
Series Y ⁽²⁾	6.500% Non-Cumulative	January 2015	44,000	25,000		1,100			6.500	%	1.63		72		On or after January 27, 2020
Series Z ⁽⁴⁾	Fixed-to-Floating Rate Non-Cumulative	October 2014	56,000	25,000		1,400			6.500% to, but excluding, 10/23/24; 3-mo. LIBOR + 417.4 bps thereafter		65.00		91		On or after October 23, 2024
Series AA ⁽⁴⁾	Fixed-to-Floating Rate Non-Cumulative	March 2015	76,000	25,000		1,900			6.100% to, but excluding, 3/17/25; 3-mo. LIBOR + 389.8 bps thereafter		61.00		116		On or after March 17, 2025
Series CC ⁽²⁾	6.200% Non-Cumulative	January 2016	44,000	25,000		1,100			6.200	%	1.55		68		On or after January 29, 2021
Series DD⁽⁴⁾	Fixed-to-Floating Rate Non-Cumulative	March 2016	40,000	25,000		1,000			6.300% to, but excluding, 3/10/26; 3-mo. LIBOR + 455.3 bps thereafter		63.00		63		On or after March 10, 2026
Series EE⁽²⁾	6.000% Non-Cumulative	April 2016	36,000	25,000		900			6.000	%	1.50		54		On or after April 25, 2021
Series FF⁽⁴⁾	Fixed-to-Floating Rate Non-Cumulative	March 2018	94,000	25,000		2,350			5.875% to, but excluding, 3/15/28; 3-mo. LIBOR + 293.1 bps thereafter		29.38		69		On or after March 15, 2028
Series GG⁽²⁾	6.000% Non-Cumulative	May 2018	54,000	25,000		1,350			6.000	%	0.75		41		On or after May 16, 2023
Series HH ⁽²⁾	5.875% Non-Cumulative	July 2018	34,160	25,000		854			5.875	%	0.73		25		On or after July 24, 2023
Series 1 ⁽⁵⁾	Floating Rate Non-Cumulative	November 2004	3,275	30,000		98			3-mo. LIBOR + 75 bps ⁽⁶⁾		0.76		3		On or after November 28, 2009
Series 2 ⁽⁵⁾	Floating Rate Non-Cumulative	March 2005	9,967	30,000		299			3-mo. LIBOR + 65 bps ⁽⁶⁾		0.76		9		On or after November 28, 2009
Series 4 ⁽⁵⁾	Floating Rate Non-Cumulative	November 2005	7,010	30,000		210			3-mo. LIBOR + 75 bps ⁽³⁾		1.01		9		On or after November 28, 2010
Series 5 ⁽⁵⁾	Floating Rate Non-Cumulative	March 2007	14,056	30,000		422			3-mo. LIBOR + 50 bps ⁽³⁾		1.01		17		On or after May 21, 2012
Issuance costs and certain adjustments						(324		)
Total			3,843,140			$	22,326


⁽¹⁾	The Corporation may redeem series of preferred stock on or after the redemption date, in whole or in part, at its option, at the liquidation preference plus declared and unpaid dividends. Series B and Series L Preferred Stock do not have early redemption/call rights.


⁽²⁾	Ownership is held in the form of depositary shares, each representing a 1/1,000th interest in a share of preferred stock, paying a quarterly cash dividend, if and when declared.


⁽³⁾	Subject to 4.00% minimum rate per annum.


⁽⁴⁾	Ownership is held in the form of depositary shares, each representing a 1/25th interest in a share of preferred stock, paying a semi-annual cash dividend, if and when declared, until the first redemption date at which time, it adjusts to a quarterly cash dividend, if and when declared, thereafter.


⁽⁵⁾	Ownership is held in the form of depositary shares, each representing a 1/1,200th interest in a share of preferred stock, paying a quarterly cash dividend, if and when declared.


⁽⁶⁾	Subject to 3.00% minimum rate per annum.

n/a = not applicable