Bank Of America Corporation · NYSE:BAC
Bank Of America — Q4 2020 Earnings Presentation
35 slides from Bank Of America's earnings presentation, Jan 19, 2021
Slide 1: Bank of America 4Q20 Financial Results
Bank of America 4Q20 Financial Results January 19, 2021
Slide 2: Full Year 2020 Financial Results
Full Year 2020 Financial Results 1 Summary Income Statement $ Inc / % Inc / FY20 FY19 ($B, except per share data) (Dec) (Dec) Total revenue, net of interest expense $85.5 $91.2 ($5.7) (6) Provision for credit losses 11.3 3.6 7.7 N/M Net charge-offs 4.1 3.6 0.5 13 Reserve build / (release) 2 7.2 (0.1
Slide 3: Consumer and Small Business Spending and Payments Trend
Consumer and Small Business Spending and Payments Trend Payment Spend Year-over-Year % Growth Credit Spend YTD 1 Debit Spend YTD Total Payments YTD 2 Total Payments Monthly 2 20% 10% 0% (10%) (20%) (30%) Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20 FY 2020 – Do
Slide 4: Global Banking Loan Trend
Global Banking Loan Trend Global Banking Funded Loans and Leases (EOP, $B) 450 400 350 300 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 12/1 12/7 12/14 12/21 12/28 12/31 Indexed Funded Loans and Leases by Business 120 Global Corporate & Investment Banking Globa
Slide 5: 2020 Strategic Progress
2020 Strategic Progress Consumer GWIM Digital • Record deposit balances and retained • Record client balances of >$3.3T 2 • 69% of Consumer and Wealth the #1 deposit market share position • Product integration continued to Management households are digitally for retail deposits 1 improve as more Mer
Slide 6: 4Q20 Financial Results
4Q20 Financial Results 1 Summary Income Statement $ Inc / $ Inc / 4Q20 3Q20 4Q19 ($B, except per share data) (Dec) (Dec) Total revenue, net of interest expense $20.1 $20.3 ($0.2) $22.3 ($2.3) Provision for credit losses 0.1 1.4 (1.3) 0.9 (0.9) Net charge-offs 0.9 1.0 (0.1) 1.0 (0.1) Reserve build /
Slide 7: 4Q20 Highlights
4Q20 Highlights (Comparisons are to 3Q20 unless otherwise noted) • Diluted earnings per share of $0.59, up 16% • Net income of $5.5B increased $0.6B, or 12%, driven by lower provision expense — Revenue of $20.1B declined 1%, as lower noninterest income was partially offset by higher net interest inc
Slide 8: Balance Sheet, Liquidity and Capital
Balance Sheet, Liquidity and Capital (EOP basis unless noted) Balance Sheet ($B) 4Q20 3Q20 4Q19 Basel 3 Capital ($B) 4 4Q20 3Q20 4Q19 Total assets $2,819.6 $2,738.5 $2,434.1 Common equity tier 1 capital (CET1) $176.7 $173.2 $166.8 Total loans and leases 927.9 955.2 983.4 Standardized approach Total
Slide 9: Average Loans and Leases
Average Loans and Leases 1 Total Loans and Leases ($B) Total Loans and Leases in All Other ($B) $928 $935 $974 $935 $1,000 $908 $125 YoY $100 (4%) $100 9 $750 18 $71 $75 $500 14 $53 $50 10 $38 YoY $250 73 5 $22 $25 58 (42%) 43 33 4 18 $0 $0 4Q16 4Q17 4Q18 4Q19 4Q20 4Q16 4Q17 4Q18 4Q19 4Q20 Residenti
Slide 10: Average Deposits
Average Deposits Bank of America Ranked #1 in U.S. Deposit Market Share 1 Total Corporation ($B) Consumer Banking ($B) YoY YoY $1,737 $885 $1,750 +23% +23% $900 $1,345 $1,410 $1,500 $1,294 $687 $720 $1,251 646 +58% $666 283 $618 $1,250 409 422 $600 209 +28% 442 183 195 $1,000 450 169 213 $750 154 16
Slide 11: Net Interest Income
Net Interest Income Net Interest Income (FTE, $B) 1 • Net interest income of $10.25B ($10.37B FTE 1) $15 $12.29 $12.27 — Increased $0.1B from 3Q20, driven by higher $10.98 $10.24 $10.37 investment securities balances due to the $10 deployment of excess cash, partially offset by lower loan balances a
Slide 12: Expense and Efficiency
Expense and Efficiency Total Noninterest Expense ($B) $15.2 $14.4 $13.9 $15 $13.8 $13.2 $13.0 $13.1 $13.2 $13.3 $13.2 $13.5 $13.4 2.1 5.4 5.3 5.0 5.3 5.3 5.1 5.4 6.2 5.7 $10 5.3 5.3 5.3 $5 8.5 7.9 7.7 7.7 8.2 8.0 7.8 8.0 8.3 8.0 8.2 8.2 $0 1 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q2
Slide 13: Asset Quality
Asset Quality Net Charge-offs ($MM) 1 • Total net charge-offs of $881MM decreased $91MM from 3Q20 $1,200 $1,122 $1,146 1.00% — Consumer net charge-offs of $482MM decreased $82MM, driven $959 $972 by Card $881 0.75% $800 — Commercial net charge-offs of $399MM were largely flat 0.50% • Net charge-off
Slide 14: Asset Quality – Consumer and Commercial Portfolios
Asset Quality – Consumer and Commercial Portfolios Consumer Net Charge-offs ($MM) Consumer Metrics ($MM) 4Q20 3Q20 4Q19 $1,000 1.50% $838 $872 Provi s i on ($139) $295 $798 $734 1.25% Nonperformi ng l oa ns a nd l ea s es 2,725 2,357 2,053 $750 $564 1.00% % of l oa ns a nd l ea s es 1 0.64 % 0.54 %
Slide 15: Consumer Banking
Consumer Banking Inc / (Dec) Summary Income Statement ($MM) 4Q20 3Q20 4Q19 • Net income of $2.6B declined $0.5B from 4Q19 driven by: Total revenue, net of interest expense $8,242 $203 ($1,272) — Lower NII from lower interest rates, as well as lower service charges due to higher client deposits and l
Slide 16: Consumer Banking Trends
Consumer Banking Trends Business Leadership 1 Total Revenue ($B) Total Expense ($B) and Efficiency • #1 Consumer Deposit Market Share A $9.5 $4.7 $4.8 $4.8 • #1 Small Business Lender B $10 $9.1 $5 $4.5 $4.5 75% $7.9 $8.0 $8.2 • #1 Online Banking and Mobile Banking $8 2.6 2.3 $4 Functionality C 65% 1
Slide 17: More Than 39 Million Active Consumer Digital Users
More Than 39 Million Active Consumer Digital Users (13% ) Total Erica Users and Interactions (MM) Person-to-Person Payments (Zelle) 1 Total Payments ($B) YoY 4.2 6.7 9.7 12.9 YoY 20.0 50.0 users (MM) $900 $825 +6% 17.2 $781 +67% 175 157.2 $60 $728 $675 15.0 40.0 140 314 (8%) 35.4 +60% $600 341 10.3
Slide 18: Global Wealth & Investment Management
Global Wealth & Investment Management Inc / (Dec) Summary Income Statement ($MM) 4Q20 3Q20 4Q19 • Net income of $0.8B decreased $0.2B from 4Q19 Total revenue, net of interest expense $4,677 $131 ($236) — Pretax margin of 24% in 4Q20 Provision for credit losses 8 (16) (11) — Net income increased 12%
Slide 19: Global Wealth & Investment Management Trends
Global Wealth & Investment Management Trends Business Leadership 1 Average Deposits ($B) Average Loans and Leases ($B) • #1 U.S. wealth management market position across client assets, deposits and loans H $350 $306 $179 $182 $186 $187 • #1 in personal trust assets under management I $287 $292 $200
Slide 20: Global Banking
Global Banking Inc/(Dec) Summary Income Statement ($MM) 4Q20 3Q20 4Q19 • Net income of $1.7B decreased $0.3B from 4Q19, due to lower revenue and higher noninterest expense Total revenue, net of interest expense 1 $4,779 $262 ($362) Provision for credit losses 48 (835) (10) • Revenue of $4.8B decreas
Slide 21: Global Banking Trends
Global Banking Trends 2 Business Leadership 1 Average Deposits ($B) Average Loans and Leases ($B) • North America’s Best Bank for Small to $494 $478 $471 Medium-sized Enterprises L $500 $500 $424 • Best Overall Brand Middle Market Banking M $379 $382 $377 $386 $373 $400 35% $400 15 $346 • North Amer
Slide 22: Global Banking Digital Update
Global Banking Digital Update 1 CashPro® Users CashPro® CashPro® App across commercial, corporate and business App Sign-ins Payment Approvals Value banking clients +40% $174B ~500K Rolling 12 mos. up 8% rolling 12 mos. CashPro® App Incoming receivables digitally matched with Digital Wallet for Check
Slide 23: Global Markets
Global Markets Inc/(Dec) Summary Income Statement ($MM) 4Q20 3Q20 4Q19 • Net income of $0.8B increased $0.2B from 4Q19 • [ Bullets to come ] — Excluding net DVA, net income of $0.8B increased 31% 2 Total revenue, net of interest expense 1 $3,907 ($376) $482 Net DVA (56) 60 30 • Revenue of $3.9B incr
Slide 24: Global Markets Trends and Revenue Mix
Global Markets Trends and Revenue Mix Business Leadership 1 2020 Global Markets Revenue Mix 2020 Total FICC S&T Revenue Mix • CMBS Bank of the Year N (excl. net DVA) 2 (excl. net DVA) 2 • Derivatives House of the Year O • Equity Derivative House of the Year P • Derivatives and Interest Rate Derivati
Slide 25: All Other
All Other 1 Inc/(Dec) Summary Income Statement ($MM) 4Q20 3Q20 4Q19 • Net loss of $425MM in 4Q20 vs. net income of $262MM in 4Q19 Total revenue, net of interest expense ($1,393) ($458) ($894) • Revenue declined, primarily due to higher client-driven ESG Provision (benefit) for credit losses (25) (7)
Slide 26: Appendix
Appendix
Slide 27: Credit Card Days Past Due Trend
Credit Card Days Past Due Trend Credit Card Days Past Due ($MM) • Credit card delinquencies declined in March through July, driven by loan deferrals and $5,000 government stimulus $4,000 • Beginning in August, we saw modest delinquency increases as deferrals expired Trend $3,000 • In 4Q20, we saw ea
Slide 28: Net Interest Income, Net Interest Yield, Average Balances, and Rates
Net Interest Income, Net Interest Yield, Average Balances, and Rates Net Interest Income (FTE, $B) 1 Average Debt Securities and Cash Balances ($B) $12.7 $12.3 $653 $11.9 $9.9 $10.5 $10.4 $442 $441 $465 $399 $431 2.76% $322 2.42% 2.52% 2.35% 2.48% 2.48% 2.48% 2.14% 2.23% 2.11% 1.71% $148 $126 $129 $
Slide 29: End of Period Loans and Leases
End of Period Loans and Leases 1 Total Corporation ($B) Consumer Banking ($B) $1,200 $1,051 $350 $317 $318 $325 $312 YoY $983 $999 YoY $300 (6%) $955 $928 $300 $1,000 (6%) $250 $800 $200 $600 $150 $400 $100 $200 $50 $0 $0 4Q19 1Q20 2Q20 3Q20 4Q20 4Q19 1Q20 2Q20 3Q20 4Q20 GWIM ($B) Global Banking ($B
Slide 30: End of Period Deposits
End of Period Deposits Bank of America Ranked #1 in U.S. Deposit Market Share 1 Total Corporation ($B) Consumer Banking ($B) YoY YoY $2,000 $1,719 $1,703 $1,795 +25% $1,000 $872 $913 $1,583 $854 +25% $1,435 $731 $762 $1,500 $800 $600 $1,000 $400 $500 $200 $0 $0 4Q19 1Q20 2Q20 3Q20 4Q20 4Q19 1Q20 2Q2
Slide 31: 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 32: Sources
Sources A Estimated retail consumer deposits based on June 30, 2020 FDIC deposit data. B FDIC, 3Q20. C Keynova 4Q20 Online Banker Scorecard; Javelin 2020 Online and Mobile Banking Scorecards. D Experian Autocount; Franchised Dealers; Largest percentage of 680+ Vantage 3.0 loan originations among key
Slide 33: 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 34: 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 35: Bank of America
BANK OF AMERICA