Bank of America Corporation Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Earnings Per Common Share

Earnings Per Common Share

3 Months Ended

Mar. 31, 2016

NOTE 13 – Earnings Per Common Share

The calculation of earnings per common share (EPS) and diluted EPS for the three months ended March 31, 2016 and 2015 is presented below. For more information on the calculation of EPS, see Note 1 – Summary of Significant Accounting Principles to the Consolidated Financial Statements of the Corporation's 2015 Annual Report on Form 10-K.



	Three Months Ended March 31
(Dollars in millions, except per share information; shares in thousands)	2016			2015
Earnings per common share
Net income	$	2,680		$	3,097
Preferred stock dividends	(457		)	(382		)
Net income applicable to common shareholders	$	2,223		$	2,715
Average common shares issued and outstanding	10,339,731			10,518,790
Earnings per common share	$	0.21		$	0.26

Diluted earnings per common share
Net income applicable to common shareholders	$	2,223		$	2,715
Add preferred stock dividends due to assumed conversions	75			75
Net income allocated to common shareholders	$	2,298		$	2,790
Average common shares issued and outstanding	10,339,731			10,518,790
Dilutive potential common shares ⁽¹⁾	760,336			747,721
Total diluted average common shares issued and outstanding	11,100,067			11,266,511
Diluted earnings per common share	$	0.21		$	0.25


⁽¹⁾	Includes incremental dilutive shares from restricted stock units, restricted stock, stock options and warrants.

The Corporation previously issued a warrant to purchase 700 million shares of the Corporation's common stock to the holder of the Series T Preferred Stock. The warrant may be exercised, at the option of the holder, through tendering the Series T Preferred Stock or paying cash. For the three months ended March 31, 2016 and 2015, the 700 million average dilutive potential common shares were included in the diluted share count under the "if-converted" method.

For the three months ended March 31, 2016 and 2015, 62 million average dilutive potential common shares associated with the 7.25% Non-Cumulative Perpetual Convertible Preferred Stock, Series L were not included in the diluted share count because the result would have been antidilutive under the "if-converted" method. For the three months ended March 31, 2016 and 2015, average options to purchase 53 million and 73 million shares of common stock were outstanding but not included in the computation of EPS because the result would have been antidilutive under the treasury stock method. For the three months ended March 31, 2016 and 2015, average warrants to purchase 122 million shares of common stock were outstanding but not included in the computation of EPS because the result would have been antidilutive under the treasury stock method. For the three months ended March 31, 2016 and 2015, average warrants to purchase 150 million shares of common stock were included in the diluted EPS calculation using the treasury stock method.