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Abonner Bank of America Corporation

Bank of America Corporation

Bank of America Earns US$3.2 Billion in Second Quarter

Charlotte, North Carolina (ots/PRNewswire)

  • Strong Pretax, Pre-provision Income of US$16 Billion
  • Another Good Quarter in Capital Markets and Home Loans
  • Enhanced Capital Strength, Tier 1 Capital Ratio at 11.93 Percent
  • Extends More Than US$211 Billion in Credit in the Second Quarter
  • Adds US$4.7 Billion to Credit Loss Reserves
Bank of America Corporation today reported second-quarter 2009
net income  of US$3.2 billion. After deducting preferred dividends of
US$805 million,  including US$713 million paid to the U.S.
government, diluted earnings per  share were US$0.33.
(Logo: http://www.newscom.com/cgi-bin/prnh/20050720/CLW086LOGO-b
)
Those results compared with net income of US$3.4 billion, or
diluted earnings per share of US$0.72 during the year-ago period.
For the first half of 2009, Bank of America earned US$7.5
billion, or US$0.75 per share.
Results were driven by continued strong revenue performance in
the wholesale capital markets businesses as well as in home loans,
complemented by the previously announced gains on the sale of China
Construction Bank (CCB) shares and the sale of the company's merchant
processing business to a joint venture. These positives were somewhat
offset by continuing high credit costs, including additions to the
reserve for loan and lease losses, as well as significant negative
credit valuation adjustments on certain liabilities including the
Merrill Lynch structured notes and the impact of a special Federal
Deposit Insurance Corp. (FDIC) assessment.
Bank of America finished the second quarter with its strongest
capital position in recent memory, with a Tier 1 Capital ratio of
11.93 percent as well as a leading liquidity position among global
banks.
"Having positive net income in an extremely challenging
environment speaks to the diversity and strength of our business
model as well as the extraordinary effort put forth by all of our
associates," said Kenneth D. Lewis, chief executive officer and
president. "Our goals during this difficult time have been to enhance
the strength of our balance sheet and capital position and to
continue to improve our earning power while dealing with the credit
issues facing our industry due to the recession.
"Difficult challenges lie ahead from continued weakness in the
global economy, rising unemployment and deteriorating credit quality
that will affect our performance for the rest of the year and into
2010," Lewis said. "However, we are convinced that Bank of America
will weather the storm and emerge as an acknowledged leader in
financial services in the United States and around the world."
"Most importantly, we continue to serve our customers and clients
around the world every day, helping them with their accounts, meeting
their financial needs and adding new business," Lewis added.
    Second Quarter 2009 Business Highlights
    - Bank of America increased its Tier 1 common capital by nearly US$40
      billion through multiple actions during the quarter that included
      issuing shares of common stock, exchanging certain non-government
      preferred stock for common stock, and asset sales.
    - Bank of America Merrill Lynch ranked No. 1 in high-yield debt
      and leveraged loans based on volume, and the firm was No. 2 and No. 3,
      respectively, in U.S. and global investment banking fees for the first
      half of 2009, according to second quarter league tables.
    - Sales and trading revenue, excluding credit valuation adjustments on
      derivative liabilities and market disruption charges, rose to a record
      US$6.7 billion.
    - During the quarter, Bank of America announced the sale of its
      merchant processing business to a joint venture, which included First
      Data Corp. The transaction is expected to deliver next-generation
      payments solutions to merchants.
    - Bank of America funded US$110.6 billion in first mortgages, helping
      nearly 500,000 people either purchase a home or refinance their existing
      mortgage, including US$24.3 billion in mortgages made to 154,000
      low- and moderate-income borrowers. Approximately 29 percent of first
      mortgages were for purchases.
    - Credit extended during the quarter, including commercial renewals of
      US$55 billion, was more than US$211 billion, compared with US$183
      billion in the first quarter. New credit included US$111 billion in
      mortgages, US$78 billion in commercial non-real estate, approximately
      US$9 billion in commercial real estate, US$4 billion in domestic and
      small business card, US$4 billion in home equity products and more than
      US$5 billion in other consumer credit.(1)
    - During the second quarter, Small Business Banking extended more than
      US$580 million in new credit comprised of credit cards, loans and lines
      of credit to more than 35,000 customers.
    - To help homeowners avoid foreclosure, Bank of America has provided rate
      relief or agreed to modifications with approximately 150,000 customers
      for the first six months of 2009, compared with more than 230,000 for
      all of 2008 for Bank of America and Countrywide. In addition,
      approximately 80,000 Bank of America customers are already in a trial
      period modification or were in the process of responding to an offer
      under the Making Home Affordable program through mid-July.
    - Average retail deposits in the quarter increased US$136.3 billion, or
      26 percent, from a year earlier, including US$104.3 billion in balances
      from Merrill Lynch and Countrywide. Excluding Countrywide and
      Merrill Lynch, Bank of America grew retail deposits US$32.0 billion,
      or 6 percent, from the year-ago quarter.
    (1) Preliminary data as of July 17, 2009
Transition Update
The Merrill Lynch integration is on track and meeting expected
goals. The company in 2009 expects to achieve in excess of 40 percent
of the previously announced goal of approximately US$7 billion in
cost savings, ahead of the original goal of 25 percent for the year.
Since June 1, approximately 6,500 affluent banking-only clients
in Bank of America have been referred to Merrill Lynch financial
advisors. Of that group, approximately 1,400 now have added an
investment relationship with the company. Merrill Lynch financial
advisors referred more than 1,100 clients to the commercial bank of
Bank of America.
The Countrywide transition and related cost savings are on track.
The new Bank of America Home Loans and Insurance brand was
introduced to consumers during the quarter as part of the transition.
Second Quarter 2009 Financial Summary
Revenue and Expense
Revenue net of interest expense on a fully taxable-equivalent
basis rose 60 percent to US$33.1 billion compared with US$20.7
billion a year ago.
Net interest income on a fully taxable-equivalent basis rose 9
percent to US$11.9 billion from US$10.9 billion in the second quarter
of 2008 due to an improved rate environment and the addition of
Countrywide and Merrill Lynch. These improvements were partially
offset by a shift in loan mix and the sale of securities. Net
interest yield narrowed 28 basis points to 2.64 percent due to the
addition of lower yielding assets from Countrywide and Merrill Lynch,
sales of securities, and a shift in loan mix, partially offset by the
favorable rate environment.
Noninterest income rose to US$21.1 billion from US$9.8 billion a
year earlier. Higher mortgage banking income, trading account profits
and investment and brokerage services income reflected the addition
of Merrill Lynch and Countrywide. Additionally, the increase was
driven by a US$5.3 billion pretax gain on the sale of CCB shares.
Bank of America continues to own approximately 11 percent of the
common shares of CCB. Noninterest income in the period also included
a US$3.8 billion pretax gain from the completed sale of the merchant
processing business to a joint venture. These increases were
partially offset by US$3.6 billion in losses related to
mark-to-market adjustments including the Merrill Lynch structured
notes as a result of narrowing credit spreads during the quarter.
Card income declined due to higher credit losses on securitized
credit card loans and lower fee income.
Noninterest expense increased to US$17.0 billion from US$9.7
billion a year earlier. This reflects higher personnel and general
operating expenses, driven in part by the Merrill Lynch and
Countrywide acquisitions and the FDIC special assessment. Pretax
merger and restructuring charges rose to US$829 million from US$212
million a year earlier.
The efficiency ratio on a fully taxable-equivalent basis was
51.44 percent compared with 46.60 percent a year earlier.
Pretax, pre-provision income on a fully-taxable equivalent basis
was US$16.1 billion compared with US$11.1 billion a year earlier.
Credit Quality
Credit quality deteriorated further as the economic environment
weakened. Consumers remained under significant stress as unemployment
and underemployment increased and individuals spent longer periods
without work. These conditions led to higher losses in almost all
consumer portfolios compared with the prior quarter.
Declining home values and reduced spending by consumers and
businesses negatively impacted the commercial portfolios resulting in
broad-based increases in criticized and nonperforming loans.
Commercial loan losses rose from the prior quarter as commercial
domestic and small business portfolios were impacted in sectors
dependent on discretionary consumer spending. Losses in the
commercial real estate portfolio also increased.
The provision for credit losses was US$13.4 billion, flat with
the first quarter. Credit losses were higher than the prior quarter
and reserves, which were increased by US$4.7 billion, were added
across most consumer portfolios and the commercial portfolio
reflecting the impact of the weak economy. Nonperforming assets were
US$31.0 billion compared with US$25.6 billion at March 31, 2009,
reflecting the continued deterioration in economic conditions. The
2009 coverage ratios and amounts shown in the following table include
Merrill Lynch.
    (All amounts in U.S. dollars unless otherwise noted)
    Credit Quality
    (Dollars in millions)         Q2 2009          Q1 2009          Q2 2008
    ---------------------         -------          -------          -------
    Provision for credit
     losses                       $13,375          $13,380           $5,830
    Net Charge-offs                 8,701            6,942            3,619
    Net Charge-off
     ratios(1)                       3.64%            2.85%            1.67%
    Total managed net
     losses                       $11,684           $9,124           $5,262
    Total managed net
     loss ratio(1)                   4.42%            3.40%            2.16%
                               At 6/30/09       At 3/31/09       At 6/30/08
                               ----------       ----------       ----------
    Nonperforming assets          $30,982          $25,632           $9,749
    Nonperforming
     assets ratio(2)                 3.31%            2.64%            1.13%
    Allowance for loan
     and lease losses             $33,785          $29,048          $17,130
    Allowance for
     loan and lease
     losses ratio(3)                 3.61%            3.00%            1.98%
     (1) Net charge-off/loss ratios are calculated as annualized held net
         charge-offs or managed net losses divided by average outstanding
         held or managed loans and leases during the period.
     (2) Nonperforming assets ratios are calculated as nonperforming assets
         divided by outstanding loans, leases and foreclosed properties at
         the end of the period.
     (3) Allowance for loan and lease losses ratios are calculated as
         allowance for loan and leases losses divided by loans and leases
         outstanding at the end of the period.
    Note: Ratios do not include loans measured at fair value in accordance
          with SFAS 159.
Capital Management
Total shareholders' equity was $255.2 billion at June 30.
Period-end assets were $2.3 trillion. The Tier 1 Capital ratio was
11.93 percent, up from 10.09 percent at March 31, 2009 and from 8.25
percent a year ago. The Tier 1 Common ratio was 6.90 percent,
compared with 4.49 percent at March 31, 2009 and 4.78 percent at June
30, 2008. The Tangible Common Equity ratio was 4.67 percent, up from
3.13 percent at March 31, 2009 and 3.24 percent a year earlier.
Tangible book value per share of common stock was $11.66, compared
with $10.88 at March 31, 2009 and $11.87 a year earlier.
During the quarter the bank increased its Tier 1 common capital
by nearly $40 billion, easily exceeding the $33.9 billion Supervisory
Capital Assessment Program (SCAP) buffer set by the Federal Reserve
in May. Actions contributing toward that goal during the quarter
included: issuing shares of common stock; exchanging certain
non-government preferred stock for common stock; the sale of a
portion of shares in CCB; and the sale of the company's merchant
processing business to a joint venture.
During the quarter, Bank of America issued 1.25 billion, or $13.5
billion, of common shares. Bank of America exchanged the equivalent
of $14.8 billion of non-government preferred shares for approximately
1 billion shares of common stock through private exchanges and a
tender offer. A cash dividend of $0.01 per common share was paid. The
company recorded $1.4 billion in preferred dividends, partially
offset by $576 million related to the exchange of preferred stock in
the calculation of net income available to common shareholders.
Period-end common shares issued and outstanding were 8.65 billion for
the second quarter of 2009, 6.40 billion for the first quarter of
2009 and 4.45 billion for the year-ago quarter.
    Second Quarter 2009 Business Segment Results
    Deposits
    (Dollars in millions)                       Q2 2009              Q2 2008
    --------------------                        -------              -------
    Total revenue, net of
     interest expense(1)                         $3,495               $4,400
    Provision for credit losses                      96                   89
    Noninterest expense                           2,649                2,324
    Net income                                      505                1,238
    Efficiency ratio(1)                           75.80%               52.82%
    Return on average equity                       8.58                20.30
    Deposits(2)                                $417,114             $337,253
                                             At 6/30/09           At 6/30/08
                                             ----------           ----------
    Period-ending deposits                     $423,192             $336,136
    (1) Fully taxable-equivalent basis
    (2) Balances averaged for period
Deposits net income fell 59 percent from a year ago on lower
revenue and higher noninterest expense. Revenue declined as a result
of lower residual net interest income allocation related to asset and
liability management activities and spread compression due to
declining interest rates. Noninterest expense rose mainly from the
FDIC special assessment.
Average customer deposits rose 24 percent, or $79.9 billion, from
a year earlier on strong organic growth, the transfer of client
deposits from Global Wealth and Investment Management and the
acquisition of Countrywide.
    Global Card Services
    (Dollars in millions)                       Q2 2009              Q2 2008
    --------------------                        -------              -------
    Total managed revenue, net
     of interest expense(1),(2)                  $7,337               $7,500
    Provision for credit
     losses(3)                                    7,741                4,259
    Noninterest expense                           1,976                2,375
    Net income (loss)                            (1,618)                 582
    Efficiency ratio(2)                           26.93%               31.67%
    Return on average equity                        n/m                 6.01
    Managed loans(4)                           $220,365             $238,918
                                             At 6/30/09           At 6/30/08
                                             ----------           ----------
    Period-ending loans                        $215,904             $240,617
     (1) Managed basis.  Managed basis assumes that credit card loans that
         have been securitized were not sold and presents earnings on these
         loans in a manner similar to the way loans that have not been sold
         (i.e., held loans) are presented.  For more information and detailed
         reconciliation, please refer to the data pages supplied with this
         press release.
     (2) Fully taxable-equivalent basis
     (3) Represents provision for credit losses on held loans combined with
         realized credit losses associated with the securitized credit card
         loan portfolio
     (4) Balances averaged for period
     n/m = not meaningful
Global Card Services swung to a net loss of $1.6 billion as
credit costs rose in the weakening economies in the U.S., Europe and
Canada. Managed net revenue declined 2 percent to $7.3 billion mainly
due to lower fee income partially offset by higher net interest
income, as lower funding costs outpaced the decline in average
managed loans.
Provision expense increased to $7.7 billion from a year earlier
as the consumer card and consumer lending portfolios deteriorated due
to the economic conditions and a rising level of bankruptcies. Also
contributing were reserve additions related to maturing
securitizations.
Noninterest expense fell 17 percent on lower operating and
marketing costs.
    Home Loans and Insurance
    (Dollars in millions)                       Q2 2009              Q2 2008
    --------------------                        -------              -------
    Total revenue, net of
     interest expense(1)                         $4,461               $1,261
    Provision for credit losses                   2,726                2,034
    Noninterest expense                           2,829                  732
    Net income (loss)                              (725)                (948)
    Efficiency ratio(1)                           63.41%               58.02%
    Return on average equity                        n/m                  n/m
    Loans(2)                                   $131,509              $91,199
                                             At 6/30/09           At 6/30/08
                                             ----------           ----------
    Period-ending loans                        $131,120              $92,064
     (1) Fully taxable-equivalent basis
     (2) Balances averaged for period
     n/m = not meaningful
The net loss in Home Loans and Insurance narrowed as higher
revenue was mostly offset by increased credit costs and noninterest
expense. Net revenue rose mainly due to the acquisition of
Countrywide and higher mortgage banking income as lower interest
rates spurred an increase in refinance activity.
The provision for credit losses increased to $2.7 billion driven
by economic weakness and falling home prices.
Noninterest expense increased to $2.8 billion mostly due to the
acquisition of Countrywide.
    Global Banking
    (Dollars in millions)                       Q2 2009              Q2 2008
    --------------------                        -------              -------
    Total revenue, net of
     interest expense(1)                         $8,658               $4,455
    Provision for credit losses                   2,584                  400
    Noninterest expense                           2,232                1,747
    Net income                                    2,487                1,433
    Efficiency ratio(1)                           25.78%               39.24%
    Return on average equity                      16.50                11.85
    Loans and leases(2)                        $323,217             $315,282
    Deposits(2)                                 199,879              169,738
     (1) Fully taxable-equivalent basis
     (2) Balances averaged for period
Global Banking net income rose to $2.5 billion, benefitting from
a $3.8 billion pretax gain generated by the sale of the company's
merchant processing business to a joint venture, the addition of
Merrill Lynch and strong deposit growth. Higher revenue was partially
offset by the challenging credit environment and the FDIC special
assessment.
The provision for credit losses increased to $2.6 billion, driven
by loan loss reserve increases and higher losses within the
commercial domestic portfolio, which were across a broad range of
borrowers and industries. Also contributing to the increase were
higher losses and reserve additions in the commercial real estate
portfolio for deterioration across various property types.
- Corporate Banking and Investment Banking revenue rose 28 percent to
      $2.0 billion as a result of the Merrill Lynch acquisition, strong fee
      growth from debt and equity capital markets, higher deposits and a
      change in deposit mix. These increases were more than offset by higher
      credit costs and the FDIC special assessment.
    - Commercial Banking revenue, excluding the $3.8 billion pretax
      gain associated with the sale of the merchant processing business to a
      joint venture, was $2.9 billion as credit and deposit net interest
      margins improved, offset by lower residual net interest income. Net
      income was negatively impacted by higher credit costs and the FDIC
      special assessment.
         - Note: Total investment banking income, including self-led
           deals, in the quarter of $1.7 billion is shared primarily between
           Global Banking and Global Markets based on an internal fee-sharing
           arrangement between the two segments. Debt and Equity issuance
           income led to an increase from the year-ago quarter, while
           advisory fees increased 83 percent, reflecting the larger
           investment banking platform from the Merrill Lynch acquisition.
    Global Markets
     (Dollars in millions)                       Q2 2009              Q2 2008
    --------------------                        -------              -------
    Total revenue, net of
     interest expense(1)                         $4,452               $1,378
    Provision for credit losses                      (1)                 (38)
    Noninterest expense                           2,559                  951
    Net income                                    1,377                  298
    Efficiency ratio(1)                           57.46%               69.04%
    Return on average equity                      17.81                 9.90
    Trading-related
     assets(2)                                 $503,688             $332,748
     (1) Fully taxable-equivalent basis
     (2) Balances averaged for period
Global Markets net income increased $1.1 billion. The increase
was driven by the addition of Merrill Lynch and lower market
disruption related charges of $900 million - a portion of the $1.3
billion total for the company. Net revenue was strong during the
period, excluding the credit valuation adjustment on derivative
liabilities and market disruption charges, surpassing record
first-quarter 2009 revenue. Noninterest expense was higher as a
result of the addition of Merrill Lynch.
- Fixed Income, Currency and Commodities revenue of $3.2 billion was
      driven by a more than fourfold increase in sales and trading revenue
      and by investment banking revenue that nearly doubled. Sales and
      trading was positively impacted by the addition of Merrill Lynch and an
      increase in liquidity in certain credit markets. Investment banking
      fees were positively impacted from the combination of the legacy
      Merrill Lynch and Bank of America debt issuance capabilities and the
      opening up of credit issuance markets.
    - Equities revenue of $1.3 billion was driven by the addition of Merrill
      Lynch and the ability to take advantage of the increase in equity flows
      during the quarter, which resulted in higher commission revenue and a
      fivefold increase in equity issuance revenue, partially offset by lower
      market volatility.
    Global Wealth and Investment Management
    (Dollars in millions)                       Q2 2009              Q2 2008
    --------------------                        -------              -------
    Total revenue, net of
     interest expense(1)                         $4,196               $2,295
    Provision for credit losses                     238                  119
    Noninterest expense                           3,304                1,244
    Net income                                      441                  581
    Efficiency ratio(1)                           78.74%               54.21%
    Return on average equity                       9.45                19.84
    Loans(2)                                   $101,748              $87,574
    Deposits(2)                                 214,111              157,113
     (in billions)                            At 6/30/09           At 6/30/08
    ------------                             ----------           ----------
    Assets under management                      $705.2               $589.4
    Total client assets(3)                     $1,824.3               $867.4
     (1) Fully taxable-equivalent basis
     (2) Balances averaged for period
     (3) Client assets are defined as assets under management, client
         brokerage assets and other assets in custody
Global Wealth and Investment Management net income fell 24
percent due to lower residual net interest income, lower equity
market levels, higher credit costs and the transfer of certain client
balances to the Deposits and the Home Loans and Insurance segments,
partially offset by the addition of Merrill Lynch.
Net revenue increased to $4.2 billion as investment and brokerage
service income rose and net interest income increased 12 percent due
to the addition of Merrill Lynch.
- Merrill Lynch Global Wealth Management net income declined 15 percent
      to $283 million from a year earlier as the addition of Merrill Lynch
      was more than offset by the impact of the significant transfer of
      client balances during the quarter to the Deposits and the Home Loans
      and Insurance segments and lower net interest income. Net revenue
      increased to $3.0 billion from $1.1 billion a year ago as investment
      and brokerage income rose mainly from the addition of Merrill Lynch.
    - U.S. Trust, Bank of America Private Wealth Management net income fell
      65 percent to $67 million as net revenue declined and credit costs
      rose. Net revenue fell 13 percent to $674 million driven by reduced
      residual net interest income and the effect of lower equity market
      levels.
    - Columbia Management net income nearly doubled to $72 million from a
      year earlier on lower support for certain cash funds and reduced
      expenses. The increase was partially offset by lower investment and
      brokerage revenue which was mainly impacted by lower equity market
      levels.
    All Other (1),(2)
    (Dollars in millions)                       Q2 2009              Q2 2008
    --------------------                        -------              -------
    Total revenue, net of
     interest expense(3)                           $487                $(563)
    Provision for credit losses                      (9)              (1,033)
    Noninterest expense                           1,471                  286
    Net income                                      757                  226
    Loans and leases(4)                        $159,142             $117,504
     (1) All Other consists primarily of equity investments, the residential
         mortgage portfolio associated with asset and liability management
         (ALM) activities, the residual impact of the cost allocation process,
         merger and restructuring charges, intersegment eliminations, fair
         value adjustments related to certain Merrill Lynch structured notes
         and the results of certain consumer finance, investment management
         and commercial lending businesses that are being liquidated. All
         Other also includes the offsetting securitization impact to present
         Global Card Services on a managed basis. For more information and
         detailed reconciliation, please refer to the data pages supplied
         with this press release.
     (2) Effective January 1, 2009, All Other includes the results of First
         Republic Bank, which was acquired as part of the Merrill Lynch
         acquisition.
     (3) Fully taxable-equivalent basis
     (4) Balances averaged for period
All Other net income increased to $757 million. Higher equity
investment income related to the gain on the sale of CCB shares and
increased gains on the sale of debt securities were partially offset
by fair value adjustments related to certain Merrill Lynch structured
notes and other-than-temporary-impairment charges related to
non-agency collateralized mortgage obligations. The provision for
credit losses rose primarily due to continued deterioration in the
residential mortgage portfolio. Noninterest expense increased mostly
on merger and restructuring charges related to the Merrill Lynch
acquisition.
Note: Chief Executive Officer and President Kenneth D. Lewis and
Chief Financial Officer Joe L. Price will discuss second quarter 2009
results in a conference call at 9:30 a.m. EDT today. The presentation
and supporting materials can be accessed on the Bank of America
Investor Relations Web site at http://investor.bankofamerica.com. For
a listen-only connection to the conference call, dial +1-877-200-4456
(U.S.) or +1-785-424-1732  (international) and the conference ID:
79795.
Bank of America
Bank of America is one of the world's largest financial
institutions, serving individual consumers, small- and middle-market
businesses and large corporations with a full range of banking,
investing, asset management and other financial and risk management
products and services. The company provides unmatched convenience in
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serving corporations, governments, institutions and individuals
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more than 4 million small business owners through a suite of
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Forward-Looking Statements
Bank of America and its management may make certain statements
that constitute "forward-looking statements" within the meaning of
the Private Securities Litigation reform Act of 1995. These
statements are not historical facts, but instead represent Bank of
America's current expectations, plans or forecasts of its future
earnings, integration of acquisitions and related cost savings,
mortgage originations and market share, credit losses, credit
reserves and charge-offs, consumer credit card net loss ratios,
mortgage delinquencies, core net interest income margin and other
similar matters. These statements are not guarantees of future
results or performance and involve certain risks, uncertainties and
assumptions that are difficult to predict and are often beyond Bank
of America's control. Actual outcomes and results may differ
materially from those expressed in, or implied by, any of these
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You should not place undue reliance on any forward-looking
statement and should consider all of the following uncertainties and
risks, as well as those more fully discussed under Item 1A. "Risk
Factors" of Bank of America's 2008 Annual Report on Form 10-K and in
any of Bank of America's subsequent SEC filings: negative economic
conditions that adversely affect the general economy, housing prices,
the job market, consumer confidence and spending habits; the level
and volatility of the capital markets, interest rates, currency
values and other market indices; changes in consumer, investor and
counterparty confidence in, and the related impact on, financial
markets and institutions; Bank of America's credit ratings and the
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certain Bank of America assets and liabilities; legislative and
regulatory actions in the United States and internationally; the
impact of litigation and regulatory investigations, including costs,
expenses, settlements and judgments; various monetary and fiscal
policies and regulations of the U.S. and non-U.S. governments;
changes in accounting standards, rules and interpretations and the
impact on Bank of America's financial statements; increased
globalization of the financial services industry and competition with
other U.S. and international financial institutions; Bank of
America's ability to attract new employees and retain and motivate
existing employees; mergers and acquisitions and their integration
into Bank of America; Bank of America's reputation; and decisions to
downsize, sell or close units or otherwise change the business mix of
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they are made, and Bank of America undertakes no obligation to update
any forward-looking statement to reflect the impact of circumstances
or events that arise after the date the forward-looking statement was
made.
Columbia Management Group, LLC ("Columbia Management") is the
primary investment management division of Bank of America
Corporation. Columbia Management entities furnish investment
management services and products for institutional and individual
investors. Columbia Funds and Excelsior Funds are distributed by
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Columbia Management Distributors, Inc. is part of Columbia Management
and an affiliate of Bank of America Corporation.
Investors should carefully consider the investment objectives,
risks, charges and expenses of any Columbia Fund or Excelsior Fund
before investing. Contact your Columbia Management representative for
a prospectus, which contains this and other important information
about the fund. Read it carefully before investing.
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Corporation. Lending, derivatives, and other commercial banking
activities are performed by banking affiliates of Bank of America
Corporation, including Bank of America, N.A., member FDIC.
Securities, financial advisory, and other investment banking
activities are performed by investment banking affiliates of Bank of
America Corporation ("Investment Banking Affiliates"), including Banc
of America Securities LLC, and Merrill Lynch, Pierce, Fenner & Smith
Incorporated, which are both registered broker-dealers and members of
FINRA and SIPC. Investment products offered by Investment Banking
Affiliates: Are Not FDIC Insured * May Lose Value * Are Not Bank
Guaranteed. Bank of America Corporation's broker-dealers are not
banks and are separate legal entities from their bank affiliates. The
obligations of the broker-dealers are not obligations of their bank
or thrift affiliates (unless explicitly stated otherwise), and these
bank affiliates are not responsible for securities sold, offered or
recommended by the broker-dealers. The foregoing also applies to our
other non-bank, non-thrift affiliates.
www.bankofamerica.com
    Bank of America Corporation and Subsidiaries
    Selected Financial Data
     (Dollars in millions, except per share data; shares in thousands)
    Summary Income              Three Months Ended     Six Months Ended
     Statement                       June 30               June 30
    --------------             -------------------    -----------------
                                   2009       2008       2009       2008
                                   ----       ----       ----       ----
    Net interest income         $11,630    $10,621    $24,127    $20,612
    Total noninterest income     21,144      9,789     44,405     16,869
                                 ------      -----     ------     ------
      Total revenue, net of
       interest expense          32,774     20,410     68,532     37,481
    Provision for
     credit losses               13,375      5,830     26,755     11,840
    Noninterest
     expense, before
     merger and
     restructuring
     charges                     16,191      9,447     32,428     18,540
    Merger and restructuring
     charges                        829        212      1,594        382
                                    ---        ---      -----        ---
      Income before
       income taxes               2,379      4,921      7,755      6,719
    Income tax expense
     (benefit)                     (845)     1,511        284      2,099
                                   ----      -----        ---      -----
      Net income                 $3,224     $3,410     $7,471     $4,620
                                 ======     ======     ======     ======
    Preferred stock
     dividends                      805        186      2,238        376
                                    ---        ---      -----        ---
      Net income available to
       common shareholders       $2,419     $3,224     $5,233     $4,244
                                 ======     ======     ======     ======
    Earnings per
     common share                 $0.33      $0.72      $0.75      $0.95
    Diluted earnings per
     common share                  0.33       0.72       0.75       0.95
    Summary Average             Three Months Ended     Six Months Ended
     Balance Sheet                   June 30               June 30
    ---------------            -------------------    -----------------
                                   2009       2008       2009       2008
                                   ----       ----       ----       ----
    Total loans and leases     $966,105   $878,639   $980,035   $877,150
    Debt securities             255,159    235,369    270,618    227,373
    Total earning assets      1,811,981  1,500,234  1,861,954  1,505,265
    Total assets              2,420,317  1,754,613  2,469,452  1,759,770
    Total deposits              974,892    786,002    969,516    786,813
    Shareholders' equity        242,867    161,428    235,855    158,078
    Common
     shareholders'
     equity                     173,497    140,243    167,153    140,849
                                Three Months Ended     Six Months Ended
    Performance Ratios               June 30               June 30
    -------------------        -------------------    -----------------
                                   2009       2008       2009       2008
                                   ----       ----       ----       ----
    Return on average assets       0.53%      0.78%      0.61%      0.53%
    Return on average common
     shareholders' equity          5.59       9.25       6.31       6.06
                                Three Months Ended     Six Months Ended
    Credit Quality                   June 30               June 30
    --------------             -------------------    -----------------
                                   2009       2008       2009       2008
                                   ----       ----       ----       ----
    Total net charge-offs        $8,701     $3,619    $15,643     $6,334
    Annualized net charge-
     offs as a % of average
     loans and leases
     outstanding (1)               3.64%      1.67%      3.24%      1.46%
    Provision for
     credit losses              $13,375     $5,830    $26,755    $11,840
    Total consumer
     credit card
     managed net losses           5,047      2,751      8,841      5,123
    Total consumer credit
     card managed net
     losses as a % of
     average managed credit
     card receivables             11.73%      5.96%     10.16%      5.58%
                                       June 30
                                   2009       2008
                                   ----       ----
    Total nonperforming
     assets                     $30,982     $9,749
    Nonperforming assets as
     a % of total loans,
     leases and foreclosed
     properties (1)                3.31%      1.13%
    Allowance for loan
     and lease losses           $33,785    $17,130
    Allowance for loan and
     lease losses as a % of
     total loans and leases
     outstanding (1)               3.61%      1.98%
    Capital Management                  June 30
    ------------------             ---------------
                                   2009       2008
                                   ----       ----
    Risk-based capital
     ratios:
      Tier 1                      11.93%      8.25%
      Tier 1 common                6.90       4.78
      Total                       15.99      12.60
    Tangible equity ratio (2)      7.39       4.72
    Tangible common equity
     ratio (3)                     4.67       3.24
    Period-end common
     shares issued and
     outstanding              8,651,459  4,452,947
                                Three Months Ended     Six Months Ended
                                     June 30               June 30
                               -------------------    -----------------
                                   2009       2008       2009       2008
                                   ----       ----       ----       ----
    Shares issued (4)         2,250,509        137  3,634,024     15,062
    Average common
     shares issued and
     outstanding              7,241,515  4,435,719  6,808,262  4,431,870
    Average diluted common
     shares issued and
     outstanding              7,269,518  4,444,098  6,836,972  4,445,428
    Dividends paid per
     common share                 $0.01      $0.64      $0.02      $1.28
                                      June 30
    Summary End of Period          ---------------
     Balance Sheet                 2009       2008
    ---------------------          ----       ----
    Total loans and leases     $942,248   $870,464
    Total debt securities       267,238    249,859
    Total earning assets      1,721,618  1,458,796
    Total assets              2,254,394  1,716,875
    Total deposits              970,742    784,764
    Total shareholders'
     equity                     255,152    162,691
    Common shareholders'
     equity                     196,492    138,540
    Book value per share of
     common stock                $22.71     $31.11
     (1) Ratios do not include loans measured at fair value in accordance
         with SFAS 159 at and for the three and six months ended June 30,
         2009 and 2008.
     (2) Tangible equity ratio equals shareholders' equity less goodwill and
         intangible assets (excluding mortgage servicing rights), net of
         related deferred tax liabilities divided by total assets less
         goodwill and intangible assets (excluding mortgage servicing rights),
         net of related deferred tax liabilities.
     (3) Tangible common equity ratio equals common shareholders' equity less
         goodwill and intangible assets (excluding mortgage servicing rights),
         net of related deferred tax liabilities divided by total assets less
         goodwill and intangible assets (excluding mortgage servicing rights),
         net of related deferred tax liabilities.
     (4) 2009 amounts include approximately 1.375 billion shares issued in the
         Merrill Lynch acquisition.
Certain prior period amounts have been reclassified to conform to
current period presentation.
Information for periods beginning July 1, 2008 include the
Countrywide acquisition. Information for the period beginning January
1, 2009 includes  the Merrill Lynch acquisition. Prior periods have
not been restated.
This information is preliminary and based on company data
available at the time of the presentation.
    Bank of America Corporation and Subsidiaries
    Business Segment Results
     (Dollars in millions)
    For the three months
     ended June 30
                                          Global Card          Home Loans
                        Deposits        Services (1, 2)       & Insurance
                    --------------      ---------------       -------------
                    2009      2008      2009      2008        2009     2008
                    ----      ----      ----      ----        ----     ----
    Total revenue,
     net of
     interest
     expense (3)   $3,495    $4,400    $7,337    $7,500      $4,461   $1,261
    Provision for
     credit losses     96        89     7,741     4,259       2,726    2,034
    Noninterest
     expense        2,649     2,324     1,976     2,375       2,829      732
    Net income
     (loss)           505     1,238    (1,618)      582        (725)    (948)
    Efficiency
     ratio (3)      75.80%    52.82%    26.93%    31.67%      63.41%   58.02%
    Return on
     average
     equity          8.58     20.30      n/m       6.01         n/m      n/m
    Average - total
     loans and
     leases           n/m       n/m $220,365   $238,918    $131,509  $91,199
    Average -
     total
     deposits    $417,114  $337,253      n/m        n/m         n/m      n/m
                                                             Global Wealth &
                                                               Investment
                    Global Banking       Global Markets        Management
                    --------------       ---------------      --------------
                    2009      2008       2009       2008      2009      2008
                    ----      ----       ----       ----      ----      ----
    Total revenue,
     net of
     interest
     expense (3)   $8,658    $4,455    $4,452    $1,378      $4,196   $2,295
    Provision for
     credit losses  2,584       400        (1)      (38)        238      119
    Noninterest
     expense        2,232     1,747     2,559       951       3,304    1,244
    Net income      2,487     1,433     1,377       298         441      581
    Efficiency
     ratio (3)      25.78%    39.24%    57.46%    69.04%      78.74%   54.21%
    Return on
     average
     equity         16.50     11.85     17.81      9.90        9.45    19.84
    Average - total
     loans and
     leases      $323,217  $315,282      n/m       n/m     $101,748  $87,574
    Average -
     total
     deposits     199,879   169,738      n/m       n/m      214,111  157,113
                    All Other (1, 4)
                     2009      2008
                     ----      ----
    Total revenue,
     net of
     interest
     expense (3)     $487     $(563)
    Provision for
     credit losses     (9)   (1,033)
    Noninterest
     expense        1,471       286
    Net income        757       226
    Average - total
     loans and
     leases      $159,142  $117,504
    Average -
     total
     deposits     108,079    96,998
     (1) Global Card Services is presented on a managed basis with a
         corresponding offset recorded in All Other.
     (2) Provision for credit losses represents provision for credit losses
         on held loans combined with realized credit losses associated with
         the securitized loan portfolio.
     (3) Fully taxable-equivalent (FTE) basis. FTE basis is a performance
         measure used by management in operating the business that management
         believes provides investors with a more accurate picture of the
         interest margin for comparative purposes.
     (4) Provision for credit losses represents provision for credit losses
         in All Other combined with the Global Card Services securitization
         offset.
    n/m = not meaningful
Certain prior period amounts have been reclassified to conform to
current period presentation.
Information for periods beginning July 1, 2008 include the
Countrywide acquisition. Information for the period beginning January
1, 2009 includes  the Merrill Lynch acquisition. Prior periods have
not been restated.
This information is preliminary and based on company data
available at the time of the presentation.
    Bank of America Corporation and Subsidiaries
    Business Segment Results
     (Dollars in millions)
    For the six months ended June 30
                                          Global Card          Home Loans &
                        Deposits        Services (1, 2)         Insurance
                     --------------     --------------         -------------
                     2009      2008     2009      2008         2009     2008
                     ----      ----     ----      ----         ----     ----
    Total revenue,
     net of
     interest
     expense (3)   $6,907    $8,488  $14,846   $15,430       $9,684   $2,584
    Provision for
     credit losses    187       195   16,182     8,711        6,098    3,846
    Noninterest
     expense        5,008     4,516    4,053     4,572        5,479    1,470
    Net income
     (loss)         1,106     2,363   (3,494)    1,401       (1,223)  (1,721)
    Efficiency
     ratio (3)      72.50%    53.21%   27.30%    29.63%       56.58%   56.91%
    Return on
     average equity  9.47     19.31      n/m      7.28          n/m      n/m
    Average - total
     loans and
     leases           n/m       n/m $224,391  $236,738     $129,110  $89,218
    Average -
     total
     deposits    $397,454  $338,358      n/m       n/m          n/m      n/m
                                                            Global Wealth &
                                                               Investment
                    Global Banking      Global Markets         Management
                    --------------      --------------        --------------
                    2009      2008      2009      2008        2009      2008
                    ----      ----      ----      ----        ----      ----
    Total revenue,
     net of
     interest
     expense (3)  $13,298    $8,354  $11,351      $537       $8,559   $4,237
    Provision for
     credit losses  4,432       926       50       (39)         492      362
    Noninterest
     expense        4,747     3,494    5,615     1,680        6,594    2,555
    Net income
     (loss)         2,659     2,456    3,812      (691)         951      825
    Efficiency
     ratio (3)      35.70%    41.82%   49.46%      n/m        77.04%   60.31%
    Return on
     average equity  9.17     10.27    26.38       n/m        10.70    14.21
    Average -
     total loans
     and leases  $327,074  $310,603      n/m       n/m     $106,117  $86,609
    Average -
     total
     deposits     197,981   165,232      n/m       n/m      231,853  152,808
                    All Other (1, 4)
                     2009      2008
                     ----      ----
    Total revenue,
     net of
     interest
     expense (3)   $4,521   $(1,533)
    Provision for
     credit losses   (686)   (2,161)
    Noninterest
     expense        2,526       635
    Net income
     (loss)         3,660       (13)
    Average -
     total loans
     and leases  $163,770  $125,695
    Average -
     total
     deposits     108,757   105,109
     (1) Global Card Services is presented on a managed basis with a
         corresponding offset recorded in All Other.
     (2) Provision for credit losses represents provision for credit losses
         on held loans combined with realized credit losses associated with
         the securitized loan portfolio.
     (3) Fully taxable-equivalent (FTE) basis. FTE basis is a performance
         measure used by management in operating the business that management
         believes provides investors with a more accurate picture of the
         interest margin for comparative purposes.
     (4) Provision for credit losses represents provision for credit losses
         in All Other combined with the Global Card Services securitization
         offset.
     n/m = not meaningful
Certain prior period amounts have been reclassified to conform to
current  period presentation.
Information for periods beginning July 1, 2008 include the
Countrywide  acquisition. Information for the period beginning
January 1, 2009 includes  the Merrill Lynch acquisition. Prior
periods have not been restated.
This information is preliminary and based on company data
available at  the time of the presentation.
    Bank of America Corporation and Subsidiaries
    Supplemental Financial Data
     (Dollars in millions)
    Fully taxable-                          Three Months       Six Months
     equivalent basis data                 Ended June 30     Ended June 30
    ----------------------               ----------------  ----------------
                                            2009     2008     2009     2008
                                            ----     ----     ----     ----
    Net interest income                  $11,942  $10,937  $24,761  $21,228
    Total revenue, net of
     interest expense                     33,086   20,726   69,166   38,097
    Net interest yield                      2.64%    2.92%    2.67%    2.83%
    Efficiency ratio                       51.44    46.60    49.19    49.67
                                               June 30
    Other Data                              2009     2008
    ----------                              ----     ----
    Full-time equivalent employees       282,408  206,587
    Number of banking centers - domestic   6,109    6,131
    Number of branded ATMs - domestic     18,426   18,531
Certain prior period amounts have been reclassified to conform to
current period presentation.
Bank of America Corporation and Subsidiaries
    Reconciliation - Managed to GAAP
    (Dollars in millions)
The Corporation reports Global Card Services on a managed basis.
Reporting on a managed basis is consistent with the way that
management evaluates the results of  Global Card Services. Managed
basis assumes  that securitized loans were not sold and presents
earnings on these loans in a manner similar to the way loans that
have not been sold (i.e., held loans) are presented. Loan
securitization is an alternative funding process that is used by the
Corporation to diversify funding sources.  Loan securitization
removes loans from the Consolidated Balance Sheet   through the sale
of loans to an off-balance sheet qualified special  purpose entity
which is excluded from the Corporation's Consolidated  Financial
Statements in accordance with accounting principles generally
accepted in the United States (GAAP).
The performance of the managed portfolio is important in
understanding  Global Card Services' results as it demonstrates the
results of the  entire portfolio serviced by the business.
Securitized loans continue  to be serviced by the business and are
subject to the same underwriting standards and ongoing monitoring as
held loans. In addition, retained  excess servicing income is exposed
to similar credit risk and repricing  of interest rates as held
loans. Global Card Services' managed income  statement line items
differ from a held basis reported as follows:
- Managed net interest income includes Global Card Services' net interest
      income on held loans and interest income on the securitized loans less
      the internal funds transfer pricing allocation related to securitized
      loans.
    - Managed noninterest income includes Global Card Services' noninterest
      income on a held basis less the reclassification of certain components
      of card income (e.g., excess servicing income) to record managed net
      interest income and provision for credit losses. Noninterest income,
      both on a held and managed basis, also includes the impact of
      adjustments to the interest-only strip that are recorded in card income
      as management continues to manage this impact within Global Card
      Services.
    - Provision for credit losses represents the provision for credit losses
      on held loans combined with realized credit losses associated with the
      securitized loan portfolio.
    Global Card Services
                     Six Months Ended                  Six Months Ended
                      June 30, 2009                     June 30, 2008
                    ------------------                ------------------
                          Securit-                         Securit-
               Managed    ization      Held     Managed    ization      Held
              Basis (1)  Impact (2)    Basis   Basis (1)  Impact (2)    Basis
             ----------  ----------    -----   ---------  ----------    -----
    Net
     interest
     income
     (3)         $10,308   $(4,749)   $5,559     $9,331     $(4,195)   $5,136
    Noninterest
     income:
     Card
      income       4,279      (348)    3,931      5,275       1,261     6,536
     All other
      income         259       (67)      192        824        (125)      699
                     ---       ---       ---        ---        ----       ---
      Total
       noninterest
       income      4,538      (415)    4,123      6,099       1,136     7,235
                   -----      ----     -----      -----       -----     -----
      Total
       revenue,
       net of
       interest
       expense    14,846    (5,164)    9,682     15,430      (3,059)   12,371
    Provision
     for credit
     losses       16,182    (5,164)   11,018      8,711      (3,059)    5,652
    Noninterest
     expense       4,053         -     4,053      4,572           -     4,572
                   -----       ---     -----      -----         ---     -----
      Income
       (loss)
       before
       income
       taxes      (5,389)        -    (5,389)     2,147           -     2,147
    Income tax
     expense
     (benefit)
     (3)          (1,895)        -    (1,895)       746           -       746
                  ------       ---    ------        ---         ---       ---
      Net
       income
       (loss)    $(3,494)       $-   $(3,494)    $1,401          $-    $1,401
                 =======       ===   =======     ======         ===    ======
    Average -
     total
     loans
     and
     leases     $224,391 $(102,357) $122,034   $236,738   $(106,306) $130,432
    All Other
                     Six Months Ended                 Six Months Ended
                       June 30, 2009                     June 30, 2008
                     ------------------               -----------------
                            Securit-                         Securit-
                Reported    ization       As     Reported    ization    As
                Basis (4) Offset (2)  Adjusted  Basis (4)  Offset (2) Adjusted
               ---------  ----------  --------  ---------  ---------- --------
    Net
     interest
     income(3)  $(3,477)    $4,749    $1,272    $(3,771)     $4,195     $424
    Noninterest
     income:
     Card income
      (loss)        256        348       604      1,259      (1,261)     (2)
     Equity
      investment
      income      7,305          -     7,305        977           -      977
     Gains on
      sales of
      debt
      securities  2,143          -     2,143        351           -      351
     All other
      income
      (loss)     (1,706)        67    (1,639)      (349)        125     (224)
                 ------        ---    ------       ----         ---     ----
      Total
       noninterest
       income     7,998        415     8,413      2,238      (1,136)   1,102
                  -----        ---     -----      -----      ------    -----
      Total
       revenue,
       net of
       interest
       expense    4,521      5,164     9,685     (1,533)      3,059    1,526
    Provision
     for credit
     losses        (686)     5,164     4,478     (2,161)      3,059      898
    Merger and
     restructuring
     charges      1,594          -     1,594        382           -      382
    All other
     noninterest
     expense        932          -       932        253           -      253
                    ---        ---       ---        ---         ---      ---
      Income
       (loss)
       before
       income
       taxes      2,681          -     2,681         (7)          -       (7)
    Income tax
     expense (3)   (979)         -      (979)         6           -        6
                   ----        ---      ----        ---         ---      ---
      Net
       income
       (loss)    $3,660         $-    $3,660       $(13)         $-     $(13)
                 ======        ===    ======       ====         ===     ====
    Average -
     total
     loans
     and
     leases    $163,770   $102,357  $266,127   $125,695    $106,306  $232,001
     (1) Provision for credit losses represents provision for credit losses
         on held loans combined with realized credit losses associated with
         the securitized loan portfolio.
     (2) The securitization impact/offset on net interest income is on a
         funds transfer pricing methodology consistent with the way funding
         costs are allocated to the businesses.
     (3) FTE basis
     (4) Provision for credit losses represents provision for credit losses
         in All Other combined with the Global Card Services securitization
         offset.
Certain prior period amounts have been reclassified among the
segments to conform to the current period presentation.
Information for periods beginning July 1, 2008 include the
Countrywide acquisition. Information for the period beginning January
1, 2009 includes  the Merrill Lynch acquisition. Prior periods have
not been restated.
This information is preliminary and based on company data
available at the time of the presentation.

Contact:

Investors: Kevin Stitt, Bank of America, +1-704-386-5667, Lee
McEntire, Bank of America, +1-704-388-6780, Grace Yoon, Bank of
America, +1-212-449-7323; or Reporters: Scott Silvestri, Bank of
America, +1-980-388-9921, scott.silvestri@bankofamerica.com / Logo:
http://www.newscom.com/cgi-bin/prnh/20050720/CLW086LOGO-b

Plus de actualités: Bank of America Corporation
Plus de actualités: Bank of America Corporation
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