| Parent Company Information |
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Note 20. |
Parent Company Information |
The following tables present Parent Company Only financial information:
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Merrill Lynch & Co., Inc.
(Parent Company Only)
Condensed Statements of (Loss) Earnings and Comprehensive (Loss) Income
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(dollars in millions) |
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For the Year Ended
December 31, 2011
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For the Year Ended
December 31, 2010
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For the Year Ended
December 31, 2009
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Revenues |
|
|
|
|
|
|
|
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Principal transactions |
$ |
1,189 |
|
|
$ |
5 |
|
|
$ |
(3,897 |
) |
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Management service fees (from affiliates) |
— |
|
|
213 |
|
|
222 |
|
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Earnings from equity method investments |
24 |
|
|
25 |
|
|
25 |
|
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Other revenue |
546 |
|
|
336 |
|
|
563 |
|
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Subtotal |
1,759 |
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|
579 |
|
|
(3,087 |
) |
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Interest revenue |
3,712 |
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|
2,999 |
|
|
3,507 |
|
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Less interest expense |
4,458 |
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|
4,550 |
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|
6,009 |
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Net interest expense |
(746 |
) |
|
(1,551 |
) |
|
(2,502 |
) |
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Revenues, net of interest expense |
1,013 |
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|
(972 |
) |
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(5,589 |
) |
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Non-interest expenses |
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|
|
|
|
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Compensation and benefits |
704 |
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|
430 |
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|
619 |
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Professional fees |
15 |
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|
57 |
|
|
45 |
|
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Communications and technology |
21 |
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|
32 |
|
|
30 |
|
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Occupancy and related depreciation |
39 |
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|
51 |
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|
37 |
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Other |
615 |
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|
673 |
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|
343 |
|
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Total non-interest expenses |
1,394 |
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|
1,243 |
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|
1,074 |
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Pre-tax loss |
(381 |
) |
|
(2,215 |
) |
|
(6,663 |
) |
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Income tax benefit |
1,874 |
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|
1,469 |
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|
3,376 |
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Equity in (loss) earnings of affiliates, net of tax |
(3,241 |
) |
|
4,522 |
|
|
10,627 |
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Net (loss) earnings |
(1,748 |
) |
|
3,776 |
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|
7,340 |
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Other comprehensive income (loss), net of tax |
19 |
|
|
(142 |
) |
|
(112 |
) |
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Comprehensive (loss) income |
$ |
(1,729 |
) |
|
$ |
3,634 |
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|
$ |
7,228 |
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Preferred stock dividends |
— |
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|
134 |
|
|
153 |
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Net (loss) earnings applicable to common stockholder |
$ |
(1,748 |
) |
|
$ |
3,642 |
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$ |
7,187 |
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Merrill Lynch & Co., Inc.
(Parent Company Only)
Condensed Balance Sheets
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(dollars in millions, except per share amounts) |
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December 31,
2011 |
|
December 31,
2010 |
ASSETS |
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Cash and cash equivalents |
$ |
105 |
|
|
$ |
379 |
|
Investment securities |
495 |
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|
528 |
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Receivables from Bank of America |
4,169 |
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|
9,656 |
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Advances to affiliates |
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Senior advances |
66,016 |
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|
76,475 |
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Subordinated loans and preferred securities |
54,226 |
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|
52,996 |
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|
120,242 |
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|
129,471 |
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Investments in affiliates |
32,020 |
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|
37,887 |
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Goodwill and other intangible assets |
3,579 |
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|
3,663 |
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Other assets |
4,606 |
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|
4,686 |
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Total Assets |
$ |
165,216 |
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$ |
186,270 |
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LIABILITIES AND STOCKHOLDER'S EQUITY |
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Liabilities |
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Payables to affiliates |
$ |
21,616 |
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$ |
22,023 |
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Other liabilities and accrued interest payable |
5,289 |
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|
7,759 |
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Long-term borrowings (includes $13,389 in 2011 and $20,179 in 2010 |
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measured at fair value in accordance with the fair value option election) |
89,018 |
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|
106,342 |
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Total Liabilities |
115,923 |
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|
136,124 |
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COMMITMENTS AND CONTINGENCIES |
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STOCKHOLDER'S EQUITY |
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Common stock (par value $1.331/3 per share; authorized; 3,000,000,000 shares; issued: 2011 and 2010 — 1,000 shares)
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— |
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— |
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Paid-in capital |
41,292 |
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40,416 |
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Accumulated other comprehensive loss (net of tax) |
(235 |
) |
|
(254 |
) |
Retained earnings |
8,236 |
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|
9,984 |
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Total Stockholder's Equity |
49,293 |
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|
50,146 |
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Total Liabilities and Stockholder's Equity |
$ |
165,216 |
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$ |
186,270 |
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Merrill Lynch & Co., Inc.
(Parent Company Only)
Condensed Statements of Cash Flows
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(dollars in millions) |
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For the Year Ended
December 31, 2011
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For the Year Ended
December 31, 2010
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For the Year Ended
December 31, 2009
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Cash flows from operating activities: |
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Net (loss) earnings |
$ |
(1,748 |
) |
|
$ |
3,776 |
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$ |
7,340 |
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Adjustments to reconcile net (loss) earnings to cash provided by (used for) operating activities |
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Equity in loss (earnings) of affiliates |
3,241 |
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|
(4,522 |
) |
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(10,627 |
) |
Depreciation and amortization |
97 |
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|
98 |
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|
96 |
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Share-based compensation expense |
486 |
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|
167 |
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|
440 |
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Deferred taxes |
(2,551 |
) |
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(317 |
) |
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(2,544 |
) |
Unrealized losses on long-term borrowings |
— |
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— |
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|
369 |
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Foreign exchange (gains) losses on long-term borrowings |
(404 |
) |
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(2,171 |
) |
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3,156 |
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Other |
2,717 |
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|
1,994 |
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|
1,979 |
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Changes in operating assets and liabilities: |
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Cash and securities segregated |
— |
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|
— |
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|
139 |
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Receivables under resale agreements |
— |
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|
1,022 |
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|
28,978 |
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Receivables from Bank of America |
5,487 |
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|
(4,708 |
) |
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(4,949 |
) |
Payables under repurchase agreements |
— |
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(7,177 |
) |
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(7,830 |
) |
Dividends and partnerships distributions from affiliates |
995 |
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|
46 |
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|
310 |
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Other, net |
1,304 |
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|
3,426 |
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(119 |
) |
Cash provided by (used for) operating activities |
9,624 |
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(8,366 |
) |
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16,738 |
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Cash flows from investing activities: |
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Proceeds from (payments for): |
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Advances to affiliates |
8,820 |
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23,666 |
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|
23,823 |
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Distributions to affiliates |
— |
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— |
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(6,850 |
) |
Maturities of available-for-sale securities |
— |
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|
557 |
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|
4,225 |
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Sales of available-for-sale securities |
— |
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|
10,190 |
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|
1,507 |
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Non-qualifying investments |
34 |
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|
33 |
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|
51 |
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Investments in affiliates |
1,836 |
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(2,302 |
) |
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(698 |
) |
Sale of MLBT-FSB to Bank of America |
— |
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— |
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|
4,450 |
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Cash provided by investing activities |
10,690 |
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|
32,144 |
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|
26,508 |
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Cash flows from financing activities: |
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(Payments for) proceeds from: |
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Short-term borrowings |
— |
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|
— |
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(20,128 |
) |
Settlement and repurchases of long-term borrowings |
(20,588 |
) |
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(23,739 |
) |
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(41,437 |
) |
Capital contributions from Bank of America |
— |
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— |
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|
6,850 |
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Dividends |
— |
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|
(134 |
) |
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(153 |
) |
Cash used for financing activities |
(20,588 |
) |
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(23,873 |
) |
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(54,868 |
) |
Decrease in cash and cash equivalents |
(274 |
) |
|
(95 |
) |
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(11,622 |
) |
Cash and cash equivalents, beginning of period |
379 |
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|
474 |
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|
12,096 |
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Cash and cash equivalents, end of period |
$ |
105 |
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$ |
379 |
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$ |
474 |
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Supplemental Disclosure of Cash Flow Information: |
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Income taxes paid |
$ |
87 |
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$ |
31 |
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$ |
359 |
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Income taxes refunded |
(16 |
) |
|
(244 |
) |
|
(156 |
) |
Interest paid |
1,742 |
|
|
2,968 |
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|
4,289 |
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Non-cash investing and financing activities;
For the year ended December 31, 2010, Merrill Lynch received a non-cash capital contribution of approximately $1.0 billion from Bank of America associated with certain employee stock awards. In addition, as of January 1, 2010, Merrill Lynch assumed assets and liabilities in connection with the consolidation of certain VIEs. See Note 9. In October 2010, Merrill Lynch’s mandatory convertible preferred stock was automatically converted to Bank of America common stock. The redemption was settled through a non-cash intercompany transaction.
In connection with the acquisition of Merrill Lynch by Bank of America, ML & Co. recorded purchase accounting adjustments for the year ended December 31, 2009, which were recorded as non-cash capital contributions. In addition, during 2009 Bank of America contributed the net assets of Banc of America Investment Services, Inc. to ML & Co. See Note 2.
Effective on January 1, 2009, Bank of America contributed the net assets of Bank of America Securities Holdings Corporation totaling approximately $3.7 billion to ML & Co. This was recorded as a non-cash capital contribution. See Note 1.
In connection with the sale of Merrill Lynch Bank USA to a subsidiary of Bank of America during 2009, ML & Co. received a note receivable as consideration for the net book value of assets and liabilities transferred to Bank of America. See Note 2.
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