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) — Q1 2019 Earnings Presentation

29 slides from Bank Of America's earnings presentation, Apr 16, 2019

  1. Slide 1: Bank of America 1Q19 Financial Results

    Bank of America 1Q19 Financial Results April 16, 2019

  2. Slide 2: Responsible Growth Has Continued to Deliver

    Responsible Growth Has Continued to Deliver 1 Diluted Earnings per Share Pretax Income ($B) $0.8 +16% $0.70 $10 +27% CAGR $8.8 CAGR $0.62 $8.4 $0.6 $8 $7.3 $0.45 $6 $5.6 $0.4 $4.8 $0.31 $0.27 +13% $4 +4% $0.2 $2 $0.0 $0 1Q15 1Q16 1Q17 1Q18 1Q19 1Q15 1Q16 1Q17 1Q18 1Q19 Average Diluted Shares Outstan

  3. Slide 3: Delivered Positive Operating Leverage for 17 Consecutive Quarters

    Delivered Positive Operating Leverage for 17 Consecutive Quarters Operating Leverage Trend 1 +22% +21% +29% +3% +8% +3% +5% +6% +8% +6% +4% +8% 2 +5% +4% +7% +7% 2 +4% 7% 7% 7% 6% 4% 4% 3% 2% 1% 1% 1% 1% (0%) (1%) (1%) (1%) (1%) (2%) (2%) (1%) (1%) (2%) (2%) (3%) (3%) (4%) (5%) (5%) (4%) (7%) (25%)

  4. Slide 4: Drove Operating Leverage With Continued Investment

    Drove Operating Leverage With Continued Investment in… Technology/Digitalization Physical Delivery Network Current location New financial center markets Expanded financial center presence in 31 new and Initiative spend expected to increase 10% in 2019 existing markets in last 12 months Our Brand Our

  5. Slide 5: Consumer Banking Digital Usage Trends

    Consumer Banking Digital Usage Trends 1 Active Digital Banking Users (MM) Total Payments ($B) Person-to-Person Payments (Zelle) 4 YoY 6.3MM Erica users +3% 5.4MM users $800 $686 $705 $626 58.1 40 37.0 $592 60 $60 33.7 35.5 32.0 $600 (3%) 50 30 318 309 27.1 309 40 $40 24.8 $400 307 22.2 28.6 20 19.6

  6. Slide 6: Average Deposits

    Average Deposits Bank of America Ranked #1 in U.S. Deposit Market Share 1 Total Corporation ($B) Consumer Banking ($B) YoY YoY $1,500 $1,297 $1,360 +5% $800 +3% $1,257 $674 $697 $1,131 $1,198 $636 $578 401 (7%) $600 $538 444 431 186 197 $1,000 405 429 172 +7% 145 157 $400 147 158 171 115 128 $500 86

  7. Slide 7: Average Loans and Leases

    Average Loans and Leases Total Loans and Leases ($B) Total Loans and Leases in All Other ($B) YoY +1% $1,000 $914 $932 $944 $200 $867 $893 $165 $800 $150 11 26 $118 $600 10 $95 $100 21 9 $68 $400 17 $47 127 13 $50 $200 87 69 8 55 39 $0 $0 1Q15 1Q16 1Q17 1Q18 1Q19 1Q15 1Q16 1Q17 1Q18 1Q19 Residential

  8. Slide 8: First Quarter 2019 Highlights

    First Quarter 2019 Highlights (% comparisons are to 1Q18) Earnings Returns and Efficiency • Diluted earnings per share of $0.70, up 13% • Return on average assets of 1.26% improved 5 bps • Record net income of $7.3B, up 6% • Return on average common shareholders’ equity of 11.42% increased 57 bps •

  9. Slide 9: 1Q19 Financial Results Summary

    1Q19 Financial Results Summary Income Statement 1Q19 1Q18 % Inc / (Dec) ($B, except per share data) Total revenue, net of interest expense $23.0 $23.1 (0) % Noninterest expense 13.2 13.8 (4) Provision for credit losses 1.0 0.8 21 Pretax income 8.8 8.4 4 Income tax expense 1.5 1.5 (1) Net income $7.3

  10. Slide 10: Balance Sheet, Liquidity and Capital

    Balance Sheet, Liquidity and Capital (EOP basis unless noted) 4 Balance Sheet ($B) 1Q19 4Q18 1Q18 Basel 3 Capital ($B) 1Q19 4Q18 1Q18 Total assets $2,377.2 $2,354.5 $2,328.5 Common equity tier 1 capital (CET1) $169.2 $167.3 $164.8 Total loans and leases 945.6 946.9 934.1 Standardized approach Total

  11. Slide 11: Net Interest Income

    Net Interest Income 1 Net Interest Income (FTE, $B) • Net interest income of $12.4B ($12.5B FTE 1) $15 Increased $0.6B from 1Q18, or 5%, reflecting the benefits $12.7 $12.5 – $11.9 $12.0 $12.2 from higher interest rates as well as loan and deposit growth, modestly offset by loan spread compression $

  12. Slide 12: Expense and Efficiency

    Expense and Efficiency Total Noninterest Expense ($B) • Total noninterest expense of $13.2B declined $0.6B, or 4%, from 1Q18, as efficiency savings, lower FDIC insurance costs and lower $13.8 $15 $13.2 $13.0 $13.1 $13.2 amortization of intangibles were partially offset by investments 5.4 – Nonintere

  13. Slide 13: Asset Quality

    Asset Quality 1 Net Charge-offs ($MM) • Total net charge-offs of $1.0B increased $67MM from 4Q18 and $1,500 1.0% $80MM from 1Q18 – Consumer net charge-offs of $0.8B increased $31MM from $996 $991 4Q18 driven primarily by credit card seasonality; stable from $1,000 $911 $932 $924 1Q18 0.5% 0.40% 0.43

  14. Slide 14: Asset Quality – Consumer and Commercial Portfolios

    Asset Quality – Consumer and Commercial Portfolios Consumer Net Charge-offs ($MM) Consumer Metrics ($MM) 1Q19 4Q18 1Q18 $1,000 2.0% Provision $830 $734 $748 $830 $830 $835 $776 $804 Nonperforming loans and leases 3,578 3,842 4,906 $750 1.5% % of loans and leases 1 0.81 % 0.86 % 1.10 % $500 1.0% Cons

  15. Slide 15: Consumer Banking

    Consumer Banking Inc / (Dec) Net income of $3.2B increased 25% from 1Q18; ROAAC of 36% Summary Income Statement ($MM) 1Q19 4Q18 1Q18 • Total revenue, net of interest expense $9,632 ($331) $652 – 11% operating leverage and steady credit costs drove results Provision for credit losses 974 59 39 • Reve

  16. Slide 16: Consumer Banking Trends

    Consumer Banking Trends Business Leadership 1 Total Revenue ($B) Total Expense ($B) and Efficiency • #1 Consumer Deposit Market Share A $12 $5 $4.5 $4.4 60% • 2019 J.D. Power Certified Mobile App $10.0 $4.4 $4.3 $4.4 $9.2 $9.4 $9.6 • 2019 J.D. Power Certified Website $9.0 $4 B $9 • Named North Ameri

  17. Slide 17: Global Wealth & Investment Management

    Global Wealth & Investment Management Inc / (Dec) Net income of $1.0B increased 14% from 1Q18; ROAAC of 29% Summary Income Statement ($MM) 1Q19 4Q18 1Q18 • Total revenue, net of interest expense $4,820 ($218) ($36) – Strong pretax margin of 29% Provision for credit losses 5 (18) (33) • Revenue of $4

  18. Slide 18: Global Wealth & Investment Management Trends

    Global Wealth & Investment Management Trends Business Leadership 1 Average Deposits ($B) Average Loans and Leases ($B) • #1 U.S. wealth management market position $300 $262 $180 $162 $164 $164 across client assets, deposits and loans I $243 $238 $247 $159 $161 $250 $236 • #1 in personal trust assets

  19. Slide 19: Global Banking

    Global Banking Inc/(Dec) Summary Income Statement ($MM) 1Q19 4Q18 1Q18 • Net income of $2.0B increased 2% from 1Q18; ROAAC of 20% Total revenue, net of interest expense 1 $5,155 ($14) $160 • Revenue of $5.2B increased 3% from 1Q18 Provision (benefit) for credit losses 111 26 95 – Reflects the benefi

  20. Slide 20: Global Banking Trends

    Global Banking Trends Business Leadership 1 Average Deposits ($B) Average Loans and Leases ($B) • North America’s Best Bank for Small to $400 $370 Medium-sized Enterprises B $360 $349 $400 $352 $355 $353 $357 $324 $323 $338 15 • Most Innovative Investment Bank of the Year 17 17 16 16 from North Amer

  21. Slide 21: Global Markets

    Global Markets Inc/(Dec) Net income of $1.0B decreased 26% from 1Q18; ROAAC of 12% Summary Income Statement ($MM) 1Q19 4Q18 1Q18 • • [ Bullets to come ] 2 Total revenue, net of interest expense 1 $4,181 $934 ($631) – Excluding net DVA, net income of $1.1B decreased 18% Net DVA (90) (142) (154) • Rev

  22. Slide 22: Global Markets Trends and Revenue Mix

    Global Markets Trends and Revenue Mix Business Leadership 1 1Q19 Global Markets Revenue Mix 1Q19 Total FICC S&T Revenue Mix • #1 Equity Portfolio Trading Share – North (excl. net DVA) 2 (excl. net DVA) 2 American Institutions L • #1 for U.S. FICC Overall Trading Quality and #1 for U.S. FICC Overall

  23. Slide 23: All Other

    All Other 1 Inc/(Dec) Summary Income Statement ($MM) 1Q19 4Q18 1Q18 • Net loss of $48MM compared to net income of $3MM in 1Q18, Total revenue, net of interest expense ($631) ($46) ($208) as revenue declined Provision (benefit) for credit losses (54) 70 98 • Provision benefit decreased $98MM from 1Q1

  24. Slide 24: Appendix

    Appendix

  25. Slide 25: Notes

    Notes A Global Liquidity Sources (GLS) include cash and high-quality, liquid, unencumbered securities, limited to U.S. government securities, U.S. agency securities, U.S. agency MBS, and a select group of non-U.S. government and supranational securities, and are readily available to meet funding req

  26. Slide 26: Sources

    Sources A Estimated retail consumer deposits based on June 30, 2018 FDIC deposit data. B Euromoney, 2018. C Dynatrace 1Q19 Mobile Banker Scorecard and 4Q18 Online Banker Scorecard; Javelin 2018 Mobile Banking Scorecard and 2018 Online Banking Scorecard. D Forrester 2018 Banking Sales Wave: U.S. Mobi

  27. Slide 27: Forward-Looking Statements

    Forward-Looking Statements Bank of America Corporation (the “Company”) 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 n

  28. Slide 28: Important Presentation Information

    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 t

  29. Slide 29: Bank of America

    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) — Q1 2019 Earnings Presentation on 6ix