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) — Q3 2015 Earnings Presentation
26 slides from Bank Of America's earnings presentation, Oct 14, 2015
Slide 1: Bank of America 3Q15 Financial Results
Bank of America 3Q15 Financial Results October 14, 2015
Slide 2: 3Q15 Highlights
3Q15 Highlights 2 • Net income of $4.5B in 3Q15, or $0.37 per diluted common share, which included the following selected items: – ($0.03) per share after-tax from negative market-related NII adjustments 1 ($0.6B pre-tax) – $0.02 per share after-tax from positive net debit valuation adjustments ($0.
Slide 3: 3Q15 Results
3Q15 Results 3 ____________________ n/m = not meaningful 1 FTE basis. 2 Represents a non-GAAP financial measure; see note A on slide 23. 3 Represents a non-GAAP financial measure. For important presentation information, see slide 25. $ in billions, except per share data 3Q15 2Q15 3Q14 Summary Income
Slide 4: Balance Sheet, Liquidity, and Capital Highlights
Balance Sheet, Liquidity, and Capital Highlights 4 $ in billions, except per shares data Balance Sheet (end of period balances) Total assets $2,153.0 $2,149.0 $2,123.6 Total loans and leases 887.7 886.4 891.3 Total deposits 1,162.0 1,149.6 1,112.0 Funding & Liquidity Long-term debt $237.3 $243.4 $25
Slide 5: Loans & Leases and Deposits
Loans & Leases and Deposits (EOP, $B) 5 ____________________ 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 6: Asset Quality Trends
$1.0 $0.9 $1.2 $1.1 $0.9 $1.2 $1.0 $1.0 $0.9 $0.9 0.52% 0.47% 0.47% 0.43% 0.42% 0.46% 0.40% 0.56% 0.49% 0.42% 0.0% 0.5% 1.0% $0.0 $0.5 $1.0 $1.5 3Q14 4Q14 1Q15 2Q15 3Q15 Reported NCOs and ratio Adjusted NCOs and ratio ____________________ 1 See note B on slide 23. 2 Represents a non-GAAP financial m
Slide 7: Net Interest Income
Net Interest Income 7 • Reported net interest income (NII) 1 of $9.7B • Negative market-related NII adjustments of $597MM in 3Q15 versus positive $669MM adjustments in 2Q15 • Excluding market-related adjustments, NII 1 of $10.3B increased $292MM from 2Q15, driven by commercial loan growth, improved
Slide 8: Expense Highlights
12.8 12.7 12.7 1.3 0.9 0.9 6.0 0.2 0.2 $20.1 $13.8 $13.8 $0 $4 $8 $12 $16 $20 $24 3Q14 2Q15 3Q15 All other LAS (excl. litigation) Litigation Expense Highlights ____________________ 1 Represents a non-GAAP financial measure; see note F on slide 23. 2 Represents a non-GAAP financial measure. • Total n
Slide 9: Consumer Banking
Consumer Banking 9 ____________________ 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 10: Consumer Banking Trends
71.3 68.4 66.7 65.7 66.0 6.9 6.8 6.9 7.0 7.2 0 2 4 6 8 10 0 20 40 60 80 3Q14 4Q14 1Q15 2Q15 3Q15 Th o u sa n d s Th o u sa n d s FTEs Sales specialists Consumer Banking Trends 10 • #1 Retail Deposit Market Share in our footprint 1 • #3 in U.S. Credit Card Balances 2 • #1 Home Equity Lender (Inside M
Slide 11: Global Wealth & Investment Management
Global Wealth & Investment Management 11 ____________________ 1 FTE basis. 2 Represents a non-GAAP financial measure. For important presentation information, see slide 25. 3 Includes financial advisors in Consumer Banking of 2,042 and 1,868 in 3Q15 and 3Q14. • Net income of $0.7B, generating a pre-t
Slide 12: GWIM Trends
GWIM Trends 12 Market Share Positioning Average Loans and Leases ($B) Total Client-Facing Professionals (000’s) 3 • #1 wealth management market position across client assets, deposits, loans, revenue and net income before taxes 1 • #1 in personal trust assets under management 2 • #1 in Barron’s U.S.
Slide 13: Global Banking
Global Banking 13 ____________________ 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 25. 4 Ranking per Dealogic f
Slide 14: Global Banking Trends
Global Banking Trends 14 ____________________ Note: Amounts may not total due to rounding. 1 Ranking per Dealogic for the third quarter as of October 5, 2015. 2 Source: Global Finance magazine (2015). 3 Global Banking shares with Global Markets in certain deal economics from investment banking and l
Slide 15: Global Markets
Global Markets 15 • [ Bullets to come ] ____________________ 1 FTE basis. 2 Represents a non-GAAP financial measure; see note G on slide 23. 3 In addition to sales and trading revenue, Global Markets shares with Global Banking in certain deal economics from investment banking and loan origination ac
Slide 16: Global Markets Trends and Revenue Mix
Global Markets Trends and Revenue Mix 16 2.3 1.5 2.8 2.2 2.0 1.0 0.9 1.2 1.2 1.2 $3.3 $2.4 $3.9 $3.3 $3.2 $0 $1 $2 $3 $4 $5 3Q14 4Q14 1Q15 2Q15 3Q15 FICC Equities $446 $456 $444 $443 $431 $50 $51 $62 $55 $51 $0 $25 $50 $75 $100 $0 $100 $200 $300 $400 $500 3Q14 4Q14 1Q15 2Q15 3Q15 Avg. trading-relate
Slide 17: Legacy Assets & Servicing
Legacy Assets & Servicing 17 • Net loss of $196MM in 3Q15 • Total revenue declined from 2Q15, driven primarily by a representations and warranties benefit which occurred in the prior quarter, less favorable MSR net-of-hedge results and lower servicing fees on a smaller servicing portfolio • LAS expe
Slide 18: All Other
• Net income of $4MM in 3Q15 • NII declined from 3Q14, driven primarily by negative market- related adjustments due to a decline in interest rates • Noninterest income was $123MM higher vs. 3Q14, driven primarily by larger gains on the sale of consumer real estate loans • Provision benefit of $67MM;
Slide 19: Key Takeaways
Key Takeaways 19 • Results reflect continued solid performance and good customer activity • In challenging rate environment, net interest income, excluding market-related adjustments, improved from 2Q15 • Managing expenses while continuing to invest in the business • Asset quality remains strong • R
Slide 20: Appendix
Appendix
Slide 21: Consumer Real Estate Asset Quality Key Indicators
____________________ 1 Excludes FVO loans. 2 Excludes write-offs of PCI loans of $128MM and $264MM related to residential mortgage and $20MM and $26MM related to home equity for 3Q15 and 2Q15. Net charge-off ratios including the PCI write-offs for residential mortgage were 0.32% and 0.86%, and for h
Slide 22: Regulatory capital ratios
____________________ 1 Regulatory capital ratios are preliminary. For important presentation information, see slide 25. 2 Bank of America received approval to begin using the Advanced approaches capital framework to determine risk-based capital requirements beginning in the fourth quarter of 2015. A
Slide 23: Notes
Notes 23 Non-GAAP Financial Measures For reconciliations to GAAP financial measures, see the accompanying reconciliations in the earnings press release and other earnings-related information. A On a GAAP basis, total revenue, net of interest expense was $20.7B, $22.1B and $21.2B for 3Q15, 2Q15 and 3
Slide 24: Forward-Looking Statements
Forward-Looking Statements 24 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 25: 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 26: Bank of America
Bankof America