Bank Of America Corporation · NYSE:BAC
Bank Of America — Q3 2021 Earnings Presentation
34 slides from Bank Of America's earnings presentation, Oct 14, 2021
Slide 1: Bank of America 3Q21 Financial Results
Bank of America 3Q21 Financial Results October 14, 2021
Slide 2: 3Q21 Highlights
3Q21 Highlights (Comparison to 3Q20, unless otherwise noted) • Net income of $7.7B; diluted earnings per share of $0.85 • Revenue, net of interest expense, of $22.8B increased $2.4B, or 12% – Net interest income (NII) of $11.1B ($11.2B FTE1) increased $1.0B, or 10%, driven by strong deposit growth a
Slide 3: U.S. Economic Recovery Continues
U.S. Economic Recovery Continues Nominal U.S. GDP U.S. Unemployment Rate $24T Above 16% pre-pandemic 14% levels 12% $22T 10% 8% 6% 4.8% $20T 4% 2% $18T 0% 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 Jan-19 Jul-19 Jan-20 Jul-20 Jan-21 Jul-21 Total Consumer and Small Business Payments1,2 Cumulat
Slide 4: Daily Loan and Lease Balance Trends ($B)
Daily Loan and Lease Balance Trends ($B) Total Loans and Leases ex. PPP1 Total Loans and Leases by Product ex. PPP1 $1,100 $600 Commercial Consumer $1,050 $550 $1,000 $500 $950 $450 $900 $400 $850 $350 03/31/20 09/30/21 03/31/20 09/30/21 Credit Card2 Residential Mortgage2 $95 $225 $220 $90 $215 $85
Slide 5: Return to Pre-pandemic Organic Growth
Return to Pre-pandemic Organic Growth 3Q211 vs. 3Q191 Net New Consumer Checking Accounts (YTD) 739K +56% Average Consumer Checking Account Balance $10.6K +40% New Consumer Investment Accounts 104K +9% Consumer Preferred Rewards Enrolled Clients2 7.8MM +31% Consumer and Small Business Digital Sales (
Slide 6: $1.25B Commitment to Address Racial Equality & Economic Opportunity
$1.25B Commitment to Address Racial Equality & Economic Opportunity Progress to date We have accelerated our work through a five-year $1.25 billion commitment • Our commitment includes sustainable finance through lending and investing, Community Development Financial and Minority Depository Institut
Slide 7: Making Financial Lives Better via Community Banking
Making Financial Lives Better via Community Banking Community Banking focuses entirely on the financial well-being of our mass market clients, providing the right products, jobs and capital to help them meet their financial goals Financial Essential Solutions Access to Capital Empowerment Providing
Slide 8: 3Q21 Financial Results
3Q21 Financial Results Summary Income Statement 3Q21 2Q21 Inc / (Dec) 3Q20 Inc / (Dec) ($B, except per share data) Total Revenue, net of interest expense $22.8 $21.5 $1.3 6 % $20.3 $2.4 12 % Provision (benefit) for credit losses (0.6) (1.6) 1.0 (62) 1.4 (2.0) (145) Net charge-offs 0.5 0.6 (0.1) (22)
Slide 9: Balance Sheet, Liquidity and Capital
Balance Sheet, Liquidity and Capital (EOP basis unless noted) Balance Sheet Metrics 3Q21 2Q21 3Q20 Basel 3 Capital ($B)4 3Q21 2Q21 3Q20 Assets ($B) Common equity tier 1 capital (CET1) $174 $179 $173 Total assets $3,085 $3,030 $2,738 Standardized approach Total loans and leases 928 919 955 Risk-weigh
Slide 10: Average Loans and Leases
Average Loans and Leases1 Total Loans and Leases ($B) Total Loans and Leases in All Other ($B) $1,200 $30 QoQ $24 $1,000 $974 $935 Annualized2 $22 $908 $908 $921 +6% $21 4 $19 $800 $20 4 $18 4 4 $600 4 $400 $10 20 18 17 15 14 $200 $0 $0 3Q20 4Q20 1Q21 2Q21 3Q21 3Q20 4Q20 1Q21 2Q21 3Q21 QoQ Ex. Annua
Slide 11: Average Deposits
Average Deposits Bank of America Ranked #1 in U.S. Retail Deposit Market Share1 Total Corporation ($B) Consumer Banking ($B) $2,500 $1,250 YoY YoY $1,943 $979 $1,001 +16% $2,000 $1,806 $1,889 +15% $1,000 $924 $1,695 $1,737 $861 $885 323 333 $1,500 729 764 +25% $750 283 295 612 646 675 276 +17% $1,00
Slide 12: Net Interest Income
Net Interest Income Net Interest Income (FTE, $B)1 • Net interest income of $11.1B ($11.2B FTE1) $15.0 – Increased $861MM from 2Q21, driven by deposit growth and related investment of $11.2 liquidity, higher PPP NII due to loan $10.2 $10.4 $10.3 $10.3 forgiveness, lower premium amortization $10.0 ex
Slide 13: Expense and Efficiency
Expense and Efficiency Total Noninterest Expense ($B) $20.0 $15.5 $15.0 $14.4 $14.4 $13.9 5.8 6.4 6.2 5.7 5.7 $10.0 8.2 8.2 9.7 8.7 8.7 $0.0 3Q20 4Q20 1Q21 2Q21 3Q21 Compensation and benefits Other Efficiency Ratio 80% 71% 69% 70% 68% 70% 63% 60% 50% 3Q20 4Q20 1Q21 2Q21 3Q21 • Noninterest expense of
Slide 14: Asset Quality
Asset Quality Net Charge-offs ($MM)1 • Total net charge-offs of $463MM1 decreased $132MM from 2Q21 $1,250 1.00% – Consumer net charge-offs of $329MM $1,000 $972 decreased $184MM, driven by lower Card losses $881 0.75% $823 – Commercial net charge-offs of $134MM $750 remained low $595 0.50% • Histori
Slide 15: Asset Quality – Consumer and Commercial Portfolios
Asset Quality – Consumer and Commercial Portfolios Consumer Net Charge-offs ($MM) Consumer Metrics ($MM) 3Q21 2Q21 3Q20 Provision $81 ($707) $295 $1,000 1.50% Nonperforming loans and leases 3,017 3,044 2,357 $750 $693 % of loans and leases1 0.71 % 0.73 % 0.54 % 1.00% Consumer 30+ days performing pas
Slide 16: Consumer Banking
Consumer Banking Inc / (Dec) • Net income of $3.0B increased significantly from Summary Income Statement ($MM) 3Q21 2Q21 3Q20 3Q20, as a result of improved revenue and lower Total revenue, net of interest expense $8,838 $652 $799 expenses and credit costs Provision (benefit) for credit losses 247 94
Slide 17: Consumer Banking Trends
Consumer Banking Trends Business Leadership1 Total Revenue ($B) Total Expense ($B) and Efficiency (A) • No. 1 in customer satisfaction for U.S. Online Banking among National Banks by J.D. Power(B) $10.0 $6.0 80% $8.8 $5.1 • No. 1 in customer satisfaction for U.S. Mobile $8.0 $8.2 $8.1 $8.2 $4.8 $4.8
Slide 18: Record 40.9MM Digital Users, up 1.6MM Year-over-Year
Record 40.9MM Digital Users, up 1.6MM Year-over-Year Digital Adoption Client Engagement Digital Active Users1 and Households2 Digital Channel Usage3,4 Digital Sales 45.0 80% 2,750 2,635 1,000 1,500 60% 1,367 40.9 39.3 2,259 40.0 38.0 2,077 1,250 2,200 50% 36.2 70% 1,799 800 1,027 1,074 35.0 853 1,00
Slide 19: Global Wealth & Investment Management
Global Wealth & Investment Management Inc / (Dec) • Net income of $1.2B increased 64% from 3Q20 Summary Income Statement ($MM) 3Q21 2Q21 3Q20 – Pretax margin of 31% in 3Q21 Total revenue, net of interest expense $5,310 $245 $764 Provision (benefit) for credit losses (58) 4 (82) • Record revenue of $
Slide 20: Global Wealth & Investment Management Trends
Global Wealth & Investment Management Trends Business Leadership1 Average Deposits ($B) Average Loans and Leases ($B)2 • No. 1 in Barron’s Top 1,200 Financial Advisors and Top 100 Women Advisors (2021) $400 $250 • No. 1 in Forbes’ Top Next Generation Advisors and $326 $333 $339 $200 Best-in-State We
Slide 21: Global Wealth & Investment Management Digital Update
Global Wealth & Investment Management Digital Update Advisor-led client interactions, powered by digital Digital Adoption GWIM1 +78%, up from 76% Online Mobile 78% of Merrill Lynch2 households digitally active across the enterprise, up from 77% in 3Q20 83% of Private Bank3 relationships digitally ac
Slide 22: Global Banking
Global Banking Inc / (Dec) • Net income of $2.5B increased $1.6B from 3Q20, Summary Income Statement ($MM) 3Q21 2Q21 3Q20 driven by lower credit costs and higher revenue Total revenue, net of interest expense1 $5,244 $154 $727 • Revenue of $5.2B increased $0.7B vs. 3Q20, Provision (benefit) for cred
Slide 23: Global Banking Trends
Global Banking Trends Business Leadership1 Average Deposits ($B) Average Loans and Leases ($B)2 • Outstanding Financial Innovator – 2021 Global(O) • North America’s Best Bank for Small to Medium-sized $600 $500 Enterprises(P) $534 $507 • Best Global Bank for Cash Management and Payments & $500 $471
Slide 24: Global Banking Digital Update
Global Banking Digital Update Creating an innovative digital experience for our clients Digital Adoption 74% Digitally Active Clients Online Mobile Connect API across commercial, corporate, and business banking clients (CashPro® & BA360 platforms) 2% YoY1 Client Engagement Digital Volume 49% ~59M $3
Slide 25: Global Markets
Global Markets1 Inc / (Dec) • Net income of $0.9B increased $68MM from 3Q20 Summary Income Statement ($MM) 3Q21 2Q21 3Q20 – Excluding net DVA, net income of $0.9B Total revenue, net of interest expense2 $4,519 ($201) $236 decreased 1%3 Net DVA (20) 14 96 • Revenue of $4.5B increased 6% from 3Q20; ex
Slide 26: Global Markets Trends and Revenue Mix
Global Markets Trends and Revenue Mix Business Leadership1 2021 YTD Global Markets Revenue Mix 2021 YTD Total FICC S&T Revenue Mix 2 • Global Derivatives House of the Year (T) (excl. net DVA) (excl. net DVA)2 • Clearing House of the Year(T) • Overall Leader for North America in Sustainable Finance(O
Slide 27: All Other
All Other1 Inc/(Dec) • Net loss of $54MM, compared to net income of $1.9B Summary Income Statement ($MM) 3Q21 2Q21 3Q20 in 2Q21 and $0.3B in 3Q20 Total revenue, net of interest expense ($1,044) $441 ($109) – 2Q21 and 3Q20 included positive income tax Provision (benefit) for credit losses (48) 5 (30)
Slide 28: Appendix
Appendix
Slide 29: Ending Loans and Leases
Ending Loans and Leases1 Total Loans and Leases ($B) Total Loans and Leases in All Other ($B) $1,200 $30 $1,000 $955 $928 $928 YoY $23 $903 $919 $21 ($27) $20 $800 $20 4 $18 4 $17 4 4 $600 3 $400 $10 19 17 16 15 14 $200 $0 $0 3Q20 4Q20 1Q21 2Q21 3Q21 3Q20 4Q20 1Q21 2Q21 3Q21 Ex. YoY $930 $905 $882 $
Slide 30: Notes
Notes A Reserve Build (or Release) is calculated by subtracting net charge-offs for the period from the provision for credit losses recognized in that period. The period-end allowance, or reserve, for credit losses reflects the beginning of the period allowance adjusted for net charge-offs recorded
Slide 31: Business Leadership Sources
Business Leadership Sources (A) Tied in the national segment of the J.D. Power 2021 U.S. Online Banking Satisfaction Study. (B) J.D. Power’s 2021 U.S. Banking Mobile App Satisfaction, U.S. Online Banking Satisfaction studies measure overall satisfaction with banking digital channels based on four fa
Slide 32: 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
Slide 33: 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
Slide 34: BANK OF AMERICA
BANK OF AMERICA