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 2013 Earnings Presentation
27 slides from Bank Of America's earnings presentation, Apr 17, 2013
Slide 1: Bank of America 1Q13 Financial Results
Bank of America 1Q13 Financial Results April 17, 2013
Slide 2: Forward-Looking Statements
Forward-Looking Statements 2 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 hist
Slide 3: 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 4: 1Q13 Results
• Pre-tax results include $0.9B annual first quarter expense associated with retirement-eligible compensation costs 1Q13 Results 4 ____________________ 1 Fully taxable-equivalent (FTE) basis. Represents a non-GAAP financial measure. 2 Represents a non-GAAP financial measure. On a GAAP basis, net int
Slide 5: Balance Sheet Highlights – End of Period
$ in billions, except per share amounts Total consumer loans and leases $545.1 ($8.4) ($44.4) Total commercial loans and leases 366.5 12.1 53.7 Total loans and leases 911.6 3.8 9.3 Total assets 2,174.6 (35.4) (6.8) Total deposits 1,095.2 (10.1) 53.9 Tangible common shareholders' equity 1 145.7 1.8 7
Slide 6: Regulatory Capital
Basel 1 1 • On a pro-forma basis, the Tier 1 common capital ratio increased 20bps from 4Q12 to 10.58% 2 • Tier 1 common capital increased $4.1B from 4Q12 primarily driven by pretax earnings of $3.6B • Risk-weighted assets increased from $1,206B at 4Q12 to $1,299B at 1Q13, driven by the implementatio
Slide 7: Funding and Liquidity
Funding and Liquidity 7 $406 $378 $380 $372 $372 31 37 35 33 30 20 25 30 35 40 45 $0 $100 $200 $300 $400 $500 1Q12 2Q12 3Q12 4Q12 1Q13 Parent company Bank subsidiaries Broker/dealers Time to Required Funding $355 $302 $287 $276 $280 $0 $100 $200 $300 $400 $500 1Q12 2Q12 3Q12 4Q12 1Q13 Global Excess
Slide 8: Net Interest Income
Net Interest Income 8 • 1Q13 reported NII and net interest yield increased $0.3B and 8bps from 4Q12 due to the following: Benefits from: – Positive impacts from market-related premium amortization expense – Higher commercial loan balances – Reduction in average long-term debt and deposit rates paid
Slide 9: Expense Highlights
14.7 13.3 13.8 0.9 0.9 2.7 3.1 2.6 0.8 2.0 0.9 $19.1 $18.4 $18.2 $0 $5 $10 $15 $20 1Q12 4Q12 1Q13 All Other Expenses Retirement-eligible costs LAS expense excl. LAS litigation & 4Q12 IFR Litigation & 4Q12 IFR Expense Highlights ____________________ 1 Represents a non-GAAP financial measure. Excludes
Slide 10: Asset Quality Trends Continued to Improve
Asset Quality Trends Continued to Improve 10 • Net charge-offs declined $587MM, or 19% from 4Q12, driven primarily by continued improvement in consumer real estate portfolio quality • Consumer loss rates are reaching five-year lows while commercial loss rates are near six-year lows • Provision expen
Slide 11: Consumer & Business Banking (CBB)
Consumer & Business Banking (CBB) 11 ____________________ 1 FTE basis. 2 Represents a non-GAAP financial measure. For important presentation information, see slide 22 and for reconciliation to GAAP financial measures, see the accompanying reconciliations in the earnings press release and other earni
Slide 12: Consumer Real Estate Services: Home Loans
$ in millions Net interest income 2 $347 ($1) $- Noninterest income 633 (271) (110) Total revenue, net of interest expense 2 980 (272) (110) Provision for credit losses 92 15 39 Noninterest expense 814 72 (43) Income tax expense 2 28 (125) (38) Net income $46 ($234) ($68) Key Indicators ($ in billio
Slide 13: CRES: Legacy Assets & Servicing
$ in millions Net interest income 2 $396 $15 ($25) Noninterest income 936 2,094 (217) Total revenue, net of interest expense 2 1,332 2,109 (242) Provision for credit losses 243 (165) (211) Noninterest expense 3,245 (1,620) 218 Income tax benefit 2 (802) 1,264 (147) Net loss ($1,354) $2,630 ($102) Ke
Slide 14: Global Wealth & Investment Management (GWIM)
Global Wealth & Investment Management (GWIM) 14 ____________________ 1 FTE basis. 2 Represents a non-GAAP financial measure. For important presentation information, see slide 22 and for reconciliation to GAAP financial measures, see the accompanying reconciliations in the earnings press release and
Slide 15: Global Banking
Global Banking 15 ____________________ 1 FTE basis. 2 Represents a non-GAAP financial measure. For important presentation information, see slide 22 and for reconciliation to GAAP financial measures, see the accompanying reconciliations in the earnings press release and other earnings-related informa
Slide 16: Global Banking Highlights
Global Banking Highlights 16 $266 $257 $257 $268 $280 $0 $100 $200 $300 1Q12 2Q12 3Q12 4Q12 1Q13 U.S. and Non-U.S. Commercial Commercial Real Estate Commercial Lease Financing Direct/Indirect & Other 65 64 65 68 68 146 149 162 174 153 $211 $213 $227 $242 $221 $0 $100 $200 $300 1Q12 2Q12 3Q12 4Q12 1Q
Slide 17: Global Markets
Global Markets 17 • [ Bullets to come ] ____________________ 1 FTE basis. 2 Represents a non-GAAP financial measure. 3 In addition to sales and trading revenue, Global Markets shares with Global Banking in certain deal economics from investment banking and loan origination activities. 4 VaR model us
Slide 18: All Other
• Net income of $864MM increased $2.4B from 3Q12 driven by the tax benefit from recognition of foreign tax credits, and $0.8B lower negative FVO adjustments on structured liabilities related to improvements in our own credit spreads • Results were impacted by the following selected items ___________
Slide 19: Delivering for Shareholders
Delivering for Shareholders 19 Driving Core Earnings Results Stability Levers Momentum • Normalized net interest income and revenue have stabilized • Additional progress on legacy mortgage issues • Continued asset quality trends with consumer and commercial loss rates at lowest level since 1Q08 and
Slide 20: Appendix
Appendix
Slide 21: Results by Business Segment
____________________ 1 FTE basis. FTE basis for the Total Corporation and pre-tax, pre-provision earnings are non-GAAP financial measures. 2 For reconciliations to GAAP financial measures, see the accompanying reconciliations in the earnings press release and other earnings-related information. Resu
Slide 22: Allocated Capital by Business Segment
Global Banking Global Markets GWIM CBB CRES All Other Unallocated $25 $30 $10 $28 $24 $11 • Effective January 1, 2013, on a prospective basis, the Corporation adjusted the amount of capital being allocated to the business segments • The adjustment reflects an enhancement to prior-year methodology (d
Slide 23: Representations and Warranties Exposure (2004-2008 vintages)
Representations and Warranties Exposure 1 (2004-2008 vintages) 23 ____________________ 1 Exposures identified above relate only to repurchase claims associated with purported representations and warranties breaches. They do not include any exposures associated with related litigation matters; separa
Slide 24: Settlement of Countrywide RMBS Class Actions
Settlement of Countrywide RMBS Class Actions 24 • We reached an agreement to settle three class action lawsuits involving Countrywide-issued residential mortgage-backed securities: Maine State Retirement System v. Countrywide Financial Corp.; David H. Luther v. Countrywide Financial Corp.; and Weste
Slide 25: Home Loans Asset Quality Key Indicators
____________________ 1 Excludes FVO loans. 2 1Q13 excludes write-offs of consumer PCI loans of $94MM related to residential mortgage and $745MM related to home equity. 4Q12 excludes write-offs of consumer PCI loans of $1.1B related to home equity. 1Q13 net charge-off ratios including the PCI write-o
Slide 26: Regulatory Capital – Basel 1 to Basel 3 (Fully Phased-in)
Basel 1 to Basel 3 (Fully Phased-in) 1, 2 26 ____________________ 1 Regulatory capital ratios are preliminary until filed with the Federal Reserve on Form Y-9C. For important presentation information, see slide 3. 2 Basel 1 includes the Market Risk Final Rule at March 31, 2013. At December 31, 2012,
Slide 27: Bank of America
Bankof America