Bank Of America Corporation · NYSE:BAC
Bank Of America — Q2 2021 Earnings Presentation
32 slides from Bank Of America's earnings presentation, Jul 14, 2021
Slide 1: Bank of America 2Q21 Financial Results
Bank of America 2Q21 Financial Results July 14, 2021
Slide 2: 2Q21 Highlights
2Q21 Highlights • Diluted earnings per share of $1.03, net income of $9.2B included the following significant items: – $1.6B provision for credit losses benefit – $2.0B positive tax adjustment related to revaluation of UK deferred tax assets • Noninterest expense of $15.0B declined $0.5B, or 3%, fro
Slide 3: U.S. Economic Recovery Continues
U.S. Economic Recovery Continues GDP Trends Credit and Debit Spend by Category2 Spending ($) U.S. Real GDP 2021 U.S. Real GDP Forecast1 vs 2020 vs. 2019 Retail +28% +34% 33.4% 31% Services +33% +20% 10.0% 4.3% 6.4% 7.0% 7.0% 25% Food +28% +16% 6.1% 6.0% (5.0%) Travel & +223% (13%) 4.5% 20% Entertain
Slide 4: Credit Card Days Past Due Trend
Credit Card Days Past Due Trend Credit Card 30+ Days Past Due ($MM) • Credit card delinquencies remain below pre- $2,500 pandemic levels as deferrals expired and balances declined $2,000 • As of the end of 2Q21, most early-stage delinquency categories are at or near historical $1,500 lows • 2Q21 30+
Slide 5: Daily Loans and Leases Balance Trends
Daily Loans and Leases Balance Trends Total Loans and Leases ex. PPP ($B)1 Total Loans and Leases by Product ex. PPP ($B)1 Commercial Consumer Credit Card ($B) Residential Mortgage ($B)2 1 Excludes balances related to the Paycheck Protection Program (PPP) of $15.7B, $21.1B, $22.7B, $24.7B, and $24.4
Slide 6: Ending Loans and Leases
Ending Loans and Leases1 Total Loans and Leases ($B) Total Loans and Leases in All Other ($B) $1,250 $30 $999 $25 QoQ $23 $1,000 $955 $928 $903 $919 +2% 5 $21 QoQ 4 $20 $20 4 $18 (8%) $750 4 4 $500 $10 21 19 17 16 15 $250 $0 $0 2Q20 3Q20 4Q20 1Q21 2Q21 2Q20 3Q20 4Q20 1Q21 2Q21 PPP $24.4 $24.7 $22.7
Slide 7: 2Q21 Financial Results
2Q21 Financial Results Summary Income Statement 2Q21 1Q21 Inc / (Dec) 2Q20 Inc / (Dec) ($B, except per share data) Total Revenue, net of interest expense $21.5 $22.8 ($1.4) (6) % $22.3 ($0.9) (4) % Provision (benefit) for credit losses (1.6) (1.9) 0.2 (13) 5.1 (6.7) (132) Net charge-offs 0.6 0.8 (0.
Slide 8: Balance Sheet, Liquidity and Capital
Balance Sheet, Liquidity and Capital (EOP basis unless noted) Balance Sheet Metrics 2Q21 1Q21 2Q20 Basel 3 Capital ($B)4 2Q21 1Q21 2Q20 Assets ($B) Common equity tier 1 capital (CET1) $179 $178 $171 Total assets $3,030 $2,970 $2,742 Standardized approach Total loans and leases 919 903 999 Risk-weigh
Slide 9: Average Loans and Leases
Average Loans and Leases1 Total Loans and Leases ($B) Total Loans and Leases in All Other ($B) $1,250 $40 $1,031 $1,000 $974 $935 YoY $30 $908 $908 (12%) $30 5 $24 $750 $22 $21 YoY 4 $19 (36%) $20 4 4 $500 4 25 $10 20 18 $250 17 15 $0 $0 2Q20 3Q20 4Q20 1Q21 2Q21 2Q20 3Q20 4Q20 1Q21 2Q21 PPP $16.0 $2
Slide 10: Average Deposits
Average Deposits Bank of America Ranked #1 in U.S. Deposit Market Share1 Total Corporation ($B) Consumer Banking ($B) YoY YoY $2,000 $1,889 +14% $1,200 $1,737 $1,806 +21% $1,658 $1,695 $979 $1,000 $924 +34% $861 $885 $1,500 675 729 $811 542 612 646 $800 323 283 295 250 276 +23% $1,000 $600 224 231 1
Slide 11: Net Interest Income
Net Interest Income Net Interest Income (FTE, $B)1 • Net interest income of $10.2B ($10.3B FTE1) $15.0 – Increased $36MM from 1Q21, driven by higher investment securities balances due to $11.0 the deployment of excess cash and one $10.2 $10.4 $10.3 $10.3 additional accrual day, partially offset by $
Slide 12: Expense and Efficiency
Expense and Efficiency Total Noninterest Expense ($B) $20.0 $15.2 $15.5 $15.0 $13.8 $13.2 $13.2 $13.3 $13.2 $13.5 $13.4 $14.4 $13.9 $13.0 $13.1 2.1 5.8 6.4 5.4 5.3 5.3 5.3 5.0 5.3 5.3 5.3 5.1 5.4 6.2 5.7 $10.0 8.5 7.9 8.2 8.0 8.0 8.3 8.0 8.2 8.2 9.7 8.7 7.7 7.7 7.8 $0.0 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19
Slide 13: Asset Quality
Asset Quality Net Charge-offs ($MM)1 • Total net charge-offs of $595MM1 decreased $228MM from 1Q21 $1,250 $1,146 1.00% – Consumer net charge-offs of $513MM decreased $972 $180MM, driven by Card, as charge-off volume $1,000 $881 0.75% from expired deferrals decreased $823 $750 – Commercial net charge
Slide 14: Asset Quality – Consumer and Commercial Portfolios
Asset Quality – Consumer and Commercial Portfolios Consumer Net Charge-offs ($MM) Consumer Metrics ($MM) 2Q21 1Q21 2Q20 Provision ($707) ($756) $2,614 $1,000 1.50% Nonperforming loans and leases 3,044 3,091 2,191 $750 $734 $693 % of loans and leases1 0.73 % 0.75 % 0.49 % 1.00% Consumer 30+ days perf
Slide 15: Consumer Banking
Consumer Banking Inc / (Dec) • Net income of $3.0B increased significantly from 2Q20, Summary Income Statement ($MM) 2Q21 1Q21 2Q20 as a result of improved revenue and lower credit costs Total revenue, net of interest expense $8,186 $117 $334 • Revenue of $8.2B increased 4% from 2Q20, driven by Prov
Slide 16: Consumer Banking Trends
Consumer Banking Trends Business Leadership1 Total Revenue ($B) Total Expense ($B) and Efficiency (A) • #1 in customer satisfaction for U.S. Online Banking among National Banks by J.D. Power(B) $10.0 $6.0 80% • #1 in customer satisfaction for U.S. Mobile Banking $8.2 $8.2 $5.1 $7.9 $8.0 $8.1 $4.7 $4
Slide 17: Record 40.5MM Digital Users, up 1.2MM Year-over-Year
Record 40.5MM Digital Users, up 1.2MM Year-over-Year Digital Banking Users and Households1,2 Digital Channel Usage3,4 Digital Sales 45.0 100% 3,000 1,000 1,500 70% 1,368 40.5 2,567 40.0 39.3 90% 2,500 2,346 1,250 60% 37.3 871 800 1,089 35.7 35.0 80% 2,000 1,961 1,000 941 50% 1,822 912 665 600 47% 30
Slide 18: Global Wealth & Investment Management
Global Wealth & Investment Management Inc / (Dec) • Net income of $1.0B increased 59% from 2Q20 Summary Income Statement ($MM) 2Q21 1Q21 2Q20 – Pretax margin of 26% in 2Q21 Total revenue, net of interest expense $5,065 $94 $640 Provision (benefit) for credit losses (62) 3 (198) • Record revenue of $
Slide 19: Global Wealth & Investment Management Trends
Global Wealth & Investment Management Trends Business Leadership1 Average Deposits ($B) Average Loans and Leases ($B)2 • #1 in Barron’s Top 1,200 ranked Financial Advisors and Top 100 Women Advisors (2021) $350 $333 $200 $186 $187 $188 $194 $326 $182 • #1 in Forbes’ Top Next Generation Advisors (202
Slide 20: Advisor-Led Client Interactions Powered by Digital
Advisor-Led Client Interactions Powered by Digital Merrill Lynch Private Bank • 79% of households using digital across the • Record 81% of clients digitally active across enterprise, up from 77% in 2Q20 the enterprise, up from 78% in 2Q20 Digital • Record 73% of households enrolled in • 2.8MM total
Slide 21: Global Banking
Global Banking Inc / (Dec) • Net income of $2.4B increased $1.7B from 2Q20, Summary Income Statement ($MM) 2Q21 1Q21 2Q20 driven primarily by lower provision for credit losses Total revenue, net of interest expense1 $5,089 $456 ($2) • Revenue of $5.1B was relatively flat vs. 2Q20, as Provision (bene
Slide 22: Global Banking Trends
Global Banking Trends Business Leadership1 Average Deposits ($B) Average Loans and Leases ($B)2 • Outstanding Financial Innovator 2021 - Global(N) $600 $500 • North America’s Best Bank for Small to Medium- $424 $494 $507 sized Enterprises(O) $500 $471 $478 $487 15 $373 $400 $346 $330 • Best Global B
Slide 23: Global Banking Digital Update
Global Banking Digital Update Creating an innovative digital experience for our clients Active Digital Clients 75% Digitally Active Clients Online Mobile Connect API across commercial, corporate, and business banking clients (CashPro® & BA360 platforms) 2% YoY1 Customer Engagement Volume 39% 88% $24
Slide 24: Global Markets
Global Markets1 Inc / (Dec) • Net income of $0.9B decreased $1.0B from 2Q20 Summary Income Statement ($MM) 2Q21 1Q21 2Q20 – Excluding net DVA, net income of $0.9B decreased Total revenue, net of interest expense2 $4,720 ($1,478) ($630) 55%3 Net DVA (34) (32) 227 • Revenue of $4.7B decreased 12% from
Slide 25: 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 • CMBS Bank of the Year (R) (excl. net DVA) (excl. net DVA)2 • Equity Derivatives House of the Year(S) • #2 Global Research Firm(T) • #2 Global Fixed Income Research T
Slide 26: All Other
All Other1 Inc/(Dec) • Net income of $1.9B increased $1.6B from 1Q21, Summary Income Statement ($MM) 2Q21 1Q21 2Q20 driven by a $2.0B positive income tax adjustment Total revenue, net of interest expense ($1,484) ($545) ($1,220) related to the revaluation of U.K. deferred tax assets, Provision (bene
Slide 27: Appendix
Appendix
Slide 28: 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 29: Sources
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 factors: navigation; s
Slide 30: 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 31: 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 32: Bank of America
BANK OF AMERICA