Bank Of America Corporation · NYSE:BAC
Bank Of America — Bank of America Corp /De/ (Bac, Bac-Pb, Bac-Pe, Bac-Pk, Bac-Pl, Bac-Pm, Bac-Pn, Bac-Po, Bac-Pp, Bml-Pg, Bml-Ph, Bml-Pj, Bml-Pl) — Q4 2015 Earnings Presentation
30 slides from Bank Of America's earnings presentation, Jan 19, 2016
Slide 1: Bank of America 4Q15 Financial Results
Bank of America 4Q15 Financial Results January 19, 2016
Slide 2: Simplified and Stronger Company
Simplified and Stronger Company $144 $146 $152 $162 $13.36 $13.79 $14.43 $15.62 $0 $5 $10 $15 $20 $0 $30 $60 $90 $120 $150 $180 4Q12 4Q13 4Q14 4Q15 Tangible common equity Tangible book value per share $372 $376 $439 $504 33 38 39 39 20 30 40 50 $0 $200 $400 $600 4Q12 4Q13 4Q14 4Q15 Global Excess Liq
Slide 3: Business Activity Highlights: Consumer and Wealth Management
Business Activity Highlights: Consumer and Wealth Management 3 $21.5 $11.6 $11.6 $13.5 $1.0 $1.9 $3.4 $3.5 $0 $5 $10 $15 $20 $25 4Q12 4Q13 4Q14 4Q15 Residential mortgage loans Home equity $455 $498 $518 $557 $250 $240 $239 $251 $704 $738 $756 $809 $0 $300 $600 $900 4Q12 4Q13 4Q14 4Q15 Consumer Banki
Slide 4: Business Activity Highlights: Global Banking and Global Markets
Business Activity Highlights: Global Banking and Global Markets 4 ____________________ Note: Amounts may not total due to rounding. 1 See note D on slide 27 for definition of VaR. 2 Fully taxable-equivalent (FTE) basis. 3 Global Banking shares with Global Markets in certain deal economics from inves
Slide 5: 4Q15 Results
4Q15 Results 1 5 ____________________ Note: Amounts may not total due to rounding. 1 2015 results include early adoption of new accounting guidance on the recognition and measurement of financial instruments. See note A on slide 27. 2 FTE basis. 3 Represents a non-GAAP financial measure. Reported to
Slide 6: Balance Sheet, Liquidity and Capital Highlights
Balance Sheet, Liquidity and Capital Highlights 6 $ in billions, except per share data Balance Sheet (end of period balances) Total assets $2,144.3 $2,153.0 $2,104.5 Total loans and leases 903.0 887.7 881.4 Total deposits 1,197.3 1,162.0 1,118.9 Funding & Liquidity Long-term debt $236.8 $237.3 $243.
Slide 7: Loans & Leases and Deposits
Loans & Leases and Deposits (EOP, $B) 7 ____________________ Note: Amounts may not total due to rounding. 1 Beginning with new originations in 2014, we retain certain residential mortgages in Consumer Banking, consistent with where the overall relationship is managed; previously such mortgages were
Slide 8: Asset Quality Trends
$0.9 $1.2 $1.1 $0.9 $1.1 $1.0 $1.0 $0.9 $0.9 $1.0 0.47% 0.47% 0.43% 0.42% 0.45% 0.40% 0.56% 0.49% 0.42% 0.51% 0.0% 0.5% 1.0% $0.0 $0.5 $1.0 $1.5 4Q14 1Q15 2Q15 3Q15 4Q15 Reported NCOs and ratio Adjusted NCOs and ratio ____________________ 1 Represents a non-GAAP financial measure. Adjusted net charg
Slide 9: Asset Quality – Consumer Portfolio
Asset Quality – Consumer Portfolio 9 Consumer Net Charge-offs ($MM) $794 $1,117 $1,020 $821 $958 0.64% 0.95% 0.87% 0.71% 0.84% 0.00% 0.50% 1.00% 1.50% $0 $500 $1,000 $1,500 4Q14 1Q15 2Q15 3Q15 4Q15 Credit Card Other Net charge-off ratio Consumer Asset Quality Metrics ($MM) 4Q15 3Q15 4Q14 Provis ion
Slide 10: Asset Quality – Commercial Portfolio
$4.9 23% $3.4 16% $5.6 26% $5.8 27% $1.6 8% Exploration & production (E&P) Oil field services (OFS) Refining & marketing Vertically integrated All other energy Asset Quality – Commercial Portfolio Commercial Net Charge-offs ($MM) $85 $77 $48 $111 $186 0.09% 0.08% 0.05% 0.11% 0.17% 0.00% 0.10% 0.20%
Slide 11: Net Interest Income
Net Interest Income 11 • Net interest income (NII) on an FTE basis of $10.0B – Positive market-related NII adjustments of $0.1B in 4Q15 versus negative $0.6B adjustments in 3Q15 – 4Q15 includes previously announced $0.6B reduction for certain trust preferred securities • Excluding market-related and
Slide 12: Expense Highlights
12.7 12.7 12.6 1.1 0.9 0.8 0.4 0.2 0.4 $14.2 $13.8 $13.9 $0 $5 $10 $15 $20 4Q14 3Q15 4Q15 All other LAS (excl. litigation) Litigation Expense Highlights ____________________ Note: Amounts may not total due to rounding. 1 Represents a non-GAAP financial measure. Reported LAS noninterest expense was $
Slide 13: Consumer Banking
Consumer Banking 13 ____________________ 1 FTE basis. 2 Cost of deposits calculated as annualized noninterest expense within the Deposits subsegment as a percentage of total average deposits within Consumer Banking. 3 Beginning in 1Q15, includes approximately 150,000 Merrill Edge and MyMerrill users
Slide 14: Consumer Banking Trends
70.5 69.3 68.8 69.2 68.4 6.8 6.9 7.0 7.2 7.6 0 2 4 6 8 10 0 20 40 60 80 4Q14 1Q15 2Q15 3Q15 4Q15 FTEs Sales specialists Consumer Banking Trends 14 • #1 Retail Deposit Market Share 1 • #3 in U.S. Credit Card Balances 2 • #1 Home Equity Lender (Inside Mortgage Finance ‘15) • #3 in J.D. Power 2015 U.S.
Slide 15: Global Wealth & Investment Management
Global Wealth & Investment Management 15 ____________________ 1 FTE basis. 2 Represents a non-GAAP financial measure. For important presentation information, see slide 29. 3 Includes financial advisors in Consumer Banking of 2,191 and 1,950 in 4Q15 and 4Q14. • Net income of $0.6B, generating a pre-t
Slide 16: Global Wealth & Investment Management Trends
Global Wealth & Investment Management Trends 16 Market Share Positioning Average Loans and Leases ($B) Total Client-Facing Professionals (000’s) 3 • #1 U.S. wealth management market position across client assets, deposits and loans 1 • #1 in personal trust assets under management 2 • #1 in Barron’s
Slide 17: Global Banking
Global Banking 17 ____________________ 1 FTE basis. 2 Global Banking shares with Global Markets in certain deal economics from investment banking and loan origination activities. 3 Represents a non-GAAP financial measure. For important presentation information, see slide 29. 4 Ranking per Dealogic f
Slide 18: Global Banking Trends
Global Banking Trends 18 ____________________ Note: Amounts may not total due to rounding. 1 Ranking per Dealogic for the fourth quarter as of January 5, 2016. 2 Global Banking shares with Global Markets in certain deal economics from investment banking and loan origination activities. 3 FTE basis.
Slide 19: Global Markets
Global Markets 1 19 • [ Bullets to come ] ____________________ n/m = not meaningful 1 2015 results include early adoption of new accounting guidance on the recognition and measurement of financial instruments. See note A on slide 27. 2 FTE basis. 3 In addition to sales and trading revenue, Global Ma
Slide 20: Global Markets Trends and Revenue Mix
Global Markets Trends and Revenue Mix 20 1.5 2.8 2.2 2.0 1.8 0.9 1.1 1.2 1.2 0.9 $2.4 $3.9 $3.3 $3.2 $2.6 $0 $1 $2 $3 $4 $5 4Q14 1Q15 2Q15 3Q15 4Q15 FICC Equities $456 $444 $443 $431 $416 $51 $62 $55 $51 $44 $0 $25 $50 $75 $100 $0 $100 $200 $300 $400 $500 4Q14 1Q15 2Q15 3Q15 4Q15 Avg. trading-relate
Slide 21: Legacy Assets & Servicing
Legacy Assets & Servicing 21 • Net loss of $0.4B in 4Q15 • Total revenue declined from 4Q14, driven by a decrease in NII on lower loan balances, as well as a modest decline in noninterest income – Mortgage banking income relatively stable from 4Q14 as lower servicing fees and MSR net of hedge result
Slide 22: All Other
• Net loss of $0.3B in 4Q15 • 4Q15 NII impacted by reduction for certain trust preferred securities, as well as positive market-related adjustments on debt securities • Noninterest income improved from 4Q14, driven primarily by the absence of a provision for U.K. payment protection insurance as well
Slide 23: Key Takeaways
Key Takeaways 23 • Full year net income of $15.9B reflects improved earnings results • Solid deposit and loan growth driven by good customer activity • Growth in net interest income • Managing costs while continuing to invest in the business • Asset quality remains strong • Strong capital and liquid
Slide 24: Appendix
Appendix
Slide 25: Consumer Real Estate Asset Quality Key Indicators
____________________ 1 Excludes FVO loans. 2 Loan-to-value (LTV) calculations apply to the residential mortgage portfolio. Combined loan-to-value (CLTV) calculations apply to the home equity portfolio. Consumer Real Estate Asset Quality Key Indicators 25 Loans end of period $187,911 $138,768 $187,93
Slide 26: Regulatory Capital – Basel transition to fully phased-in
Regulatory Capital – Basel 3 transition to fully phased-in 4Q15 3Q15 4Q14 Common equity tier 1 capital (transition) $163,026 $161,649 $155,361 Deferred tax assets arising from net operating loss and tax credit carryforwards phased in during transition (5,151) (5,554) (8,905) Accumulated OCI phased i
Slide 27: Notes
Notes 27 A In January 2016, the FASB issued new accounting guidance on recognition and measurement of financial instruments. The Corporation has early adopted, retrospective to January 1, 2015, the provision that requires the Corporation to present unrealized gains/losses resulting from changes in t
Slide 28: Forward-Looking Statements
Forward-Looking Statements 28 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 can be identified by the fact that they do not relate strictly to his
Slide 29: Important Presentation Information
• The information contained herein is preliminary and based on Company data available at the time of the earnings presentation. It speaks only as of the particular date or dates included in the accompanying slides. Bank of America does not undertake an obligation to, and disclaims any duty to, updat
Slide 30: Bank of America
Bankof America