Exhibit 99.2
Supplemental Information
Second Quarter 2004
July 14, 2004
This information is preliminary and based on company data available at the time of the presentation. It speaks only as of the particular date or dates included in the accompanying pages. Bank of America does not undertake an obligation to, and disclaims any duty to, correct or update any of the information provided. Any forward-looking statements in this information are subject to the forward-looking language contained in Bank of America's reports filed with the SEC pursuant to the Securities Exchange Act of 1934, which are available at the SEC's website (www.sec.gov) or at Bank of America's website (www.bankofamerica.com). Bank of America's future financial performance is subject to risks and uncertainties as described in its SEC filings.
Bank of America Corporation
Results Overview
2nd Quarter 2004 Results
• | Net income of $3.85 billion or $1.86 per diluted share includes results from FleetBoston acquisition. |
Excluding merger and restructuring charges of $125 million, $83 million after tax, earnings were $1.90 per diluted share.
Prior period results on a GAAP basis under purchase accounting rules do not include FleetBoston history.
• | Results include $125 million merger and restructuring charges, or $0.04 after tax. |
• | Revenue of $13.0 billion increased 37% from 1Q04 on a reported basis. On a combined basis, revenue increased 3%. |
• | Noninterest expense of $7.2 billion increased 33% from 1Q04 on a reported basis and includes a pre-tax merger charge of $125 million. |
On a combined basis, noninterest expense, excluding the merger charge, decreased 6%.
• | Current quarter includes $300 million litigation costs while 1Q04 included $425 million mutual fund settlement charges. |
• | Current quarter includes an estimated $206 million in merger cost saves. |
• | Securities gains in the quarter were $795 million as the company repositioned from lower to higher coupon mortgages. Security gains for 1Q04 were $495 million on a reported basis and $544 million on a combined basis. |
• | Provision expense of $789 million increased 26% from 1Q04 on a reported basis as well as on a combined basis as Fleet reported no provision expense in the 1Q04. |
• | Credit quality trends in 2Q04 continue to show improvement in commercial and large corporate businesses, while consumer businesses remain stable and are performing well. |
• | Nonperforming assets of $3.18 billion, or 0.64% of loans, leases and foreclosed properties, increased $694 million on a reported basis. On a combined basis, nonperforming assets declined $527 million from 1Q04 levels. |
• | Net loan charge-offs were $829 million, or 0.67% of average loans and leases. This compares to reported 1Q04 net charge-offs of $720 million or 0.77% of average loans and leases. On a combined basis, net charge-offs declined $124 million from $953 million, or 0.76% of average loans and leases. |
• | Second quarter business highlights presented on a combined basis include: |
• | Product sales in the banking centers increased 32% from a year ago. |
• | Average core retail deposits grew $14 billion, or 4%, from the prior quarter. |
• | Net new checking accounts grew by 575,000 during the quarter including 43,000 in the former Fleet franchise. |
• | Net new savings accounts grew by 740,000 during the quarter, including 63,000 in the former Fleet franchise. |
• | Opened 1.5 million new credit card accounts during 2Q04. |
• | Middle market loans continue steady growth. |
• | Record investment banking revenue led by strength in leveraged loan syndications. |
• | Online banking now includes more than 11.2 million active online banking customers with 4.5 million of these customers paying more than $21 billion in bills online quarterly. |
• | Merger integration ahead of schedule. |
• | All key consumer and commercial market executives in the Northeast are in place and trained. |
• | Bank of America Spirit rolled out to New England banking centers in June. |
• | Loan Solutions mortgage platform rolled out to Connecticut stores and will be fully implemented in the Northeast by end of 3Q. |
• | Re-issuance of Fleet credit and debit cards will begin in 3Q04 and will be completed by end of 1Q05. |
• | Sign changes in the Northeast will start in 3Q04 and will be completed by end of 2004. |
• | Accounting back-office systems conversions are expected to be completed during 3Q04. |
• | Model Bank scheduled implementation is 2Q05. |
1
Bank of America Corporation
Consolidated Financial Highlights
(Dollars in millions, except per share information; shares in thousands)
Year-to- 2004 | Year-to- 2003 | Second Quarter 2004 | First Quarter 2004 | Fourth Quarter 2003 | Third Quarter 2003 | Second Quarter 2003 | ||||||||||||||||||||||
Income statement | ||||||||||||||||||||||||||||
Total revenue | $ | 22,539 | $ | 18,529 | $ | 13,021 | $ | 9,518 | $ | 9,635 | $ | 9,750 | $ | 9,627 | ||||||||||||||
Provision for credit losses | 1,413 | 1,605 | 789 | 624 | 583 | 651 | 772 | |||||||||||||||||||||
Gains on sales of debt securities | 1,290 | 569 | 795 | 495 | 139 | 233 | 296 | |||||||||||||||||||||
Noninterest expense | 12,618 | 9,790 | 7,201 | 5,417 | 5,288 | 5,077 | 5,065 | |||||||||||||||||||||
Income tax expense | 3,268 | 2,541 | 1,977 | 1,291 | 1,177 | 1,333 | 1,348 | |||||||||||||||||||||
Net income | 6,530 | 5,162 | 3,849 | 2,681 | 2,726 | 2,922 | 2,738 | |||||||||||||||||||||
Diluted earnings per common share | 3.70 | 3.39 | 1.86 | 1.83 | 1.83 | 1.92 | 1.80 | |||||||||||||||||||||
Average diluted common shares issued and outstanding | 1,765,519 | 1,524,715 | 2,065,645 | 1,466,701 | 1,489,481 | 1,519,641 | 1,523,306 | |||||||||||||||||||||
Dividends paid per common share | $ | 1.60 | $ | 1.28 | $ | 0.80 | $ | 0.80 | $ | 0.80 | $ | 0.80 | $ | 0.64 | ||||||||||||||
Performance ratios | ||||||||||||||||||||||||||||
Return on average assets | 1.34 | % | 1.40 | % | 1.40 | % | 1.27 | % | 1.39 | % | 1.48 | % | 1.42 | % | ||||||||||||||
Return on average common shareholders’ equity | 18.53 | 20.90 | 16.63 | 22.16 | 22.42 | 23.74 | 21.86 | |||||||||||||||||||||
Book value per share of common stock | $ | 47.01 | $ | 34.06 | $ | 47.01 | $ | 33.71 | $ | 33.26 | $ | 33.83 | $ | 34.06 | ||||||||||||||
Market price per share of common stock: | ||||||||||||||||||||||||||||
High closing price for the period | $ | 85.44 | $ | 79.89 | $ | 85.44 | $ | 82.76 | $ | 82.50 | $ | 83.53 | $ | 79.89 | ||||||||||||||
Low closing price for the period | 77.17 | 65.63 | 77.17 | 78.30 | 72.85 | 74.87 | 68.00 | |||||||||||||||||||||
Closing price | 84.62 | 79.03 | 84.62 | 80.98 | 80.43 | 78.04 | 79.03 | |||||||||||||||||||||
Market capitalization | 171,891 | 118,254 | 171,891 | 117,056 | 115,911 | 116,236 | 118,254 | |||||||||||||||||||||
Number of banking centers | 5,790 | 4,200 | 5,790 | 4,272 | 4,277 | 4,211 | 4,200 | |||||||||||||||||||||
Number of ATMs | 16,696 | 13,250 | 16,696 | 13,168 | 13,241 | 13,120 | 13,250 | |||||||||||||||||||||
Full-time equivalent employees | 177,986 | 132,796 | 177,986 | 134,374 | 133,549 | 132,749 | 132,796 |
Certain prior period amounts have been reclassified to conform to current period presentation.
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
2
Bank of America Corporation
Supplemental Financial Data
(Dollars in millions)
Fully taxable-equivalent basis data
Year-to- Date 2004 | Year-to- Date 2003 | Second Quarter 2004 | First Quarter 2004 | Fourth Quarter 2003 | Third Quarter 2003 | Second Quarter 2003 | ||||||||||||||||||||||
Net interest income | $ | 13,721 | $ | 10,885 | $ | 7,751 | $ | 5,970 | $ | 5,745 | $ | 5,477 | $ | 5,524 | ||||||||||||||
Total revenue | 22,878 | 18,840 | 13,191 | 9,687 | 9,794 | 9,923 | 9,786 | |||||||||||||||||||||
Net interest yield | 3.26 | % | 3.42 | % | 3.29 | % | 3.22 | % | 3.39 | % | 3.22 | % | 3.33 | % | ||||||||||||||
Efficiency ratio | 55.15 | 51.96 | 54.59 | 55.92 | 53.98 | 51.16 | 51.76 |
Reconciliation to GAAP financial measures
Supplemental financial data presented on an operating basis is a basis of presentation not defined by GAAP (generally accepted accounting principles) that excludes merger and restructuring charges. We believe that the exclusion of the merger and restructuring charges, which represent events outside of our normal operations, provides a meaningful period-to-period comparison and is more reflective of normalized operations.
Shareholder value added (SVA) is a key measure of performance not defined by GAAP that is used in managing our growth strategy orientation and strengthening our focus on generating long-term growth and shareholder value. SVA is used in measuring performance of our different business units and is an integral component for allocating resources. Each business segment has a goal for growth in SVA reflecting the individual segment's business and customer strategy.
Other companies may define or calculate supplemental financial data differently. See the Tables below for supplemental financial data and corresponding reconciliation to GAAP financial measures for year-to-date ended June 30, 2004 and 2003, and the quarters ended June 30, 2004, March 31, 2004, December 31, 2003, September 30, 2003 and June 30, 2003.
Reconciliation of net income to operating earnings
Year-to- Date 2004 | Year-to- Date | Second Quarter 2004 | First Quarter 2004 | Fourth Quarter 2003 | Third Quarter 2003 | Second Quarter 2003 | ||||||||||||||||||||||
Net income | $ | 6,530 | $ | 5,162 | $ | 3,849 | $ | 2,681 | $ | 2,726 | $ | 2,922 | $ | 2,738 | ||||||||||||||
Merger and restructuring charges | 125 | — | 125 | — | — | — | — | |||||||||||||||||||||
Related income tax benefit | (42 | ) | — | (42 | ) | — | — | — | — | |||||||||||||||||||
Operating earnings | $ | 6,613 | $ | 5,162 | $ | 3,932 | $ | 2,681 | $ | 2,726 | $ | 2,922 | $ | 2,738 | ||||||||||||||
Operating Basis | ||||||||||||||||||||||||||||
Diluted earnings per common share | $ | 3.74 | $ | 3.39 | $ | 1.90 | $ | 1.83 | $ | 1.83 | $ | 1.92 | $ | 1.80 | ||||||||||||||
Return on average assets | 1.36 | % | 1.40 | % | 1.43 | % | 1.27 | % | 1.39 | % | 1.48 | % | 1.42 | % | ||||||||||||||
Return on avg common shareholders' equity | 18.77 | 20.99 | 16.99 | 22.16 | 22.42 | 23.74 | 21.86 | |||||||||||||||||||||
Efficiency ratio | 54.61 | 51.96 | 53.64 | 55.92 | 53.98 | 51.16 | 51.76 | |||||||||||||||||||||
Reconciliation of net income to shareholder value added | ||||||||||||||||||||||||||||
Net income | $ | 6,530 | $ | 5,162 | $ | 3,849 | $ | 2,681 | $ | 2,726 | $ | 2,922 | $ | 2,738 | ||||||||||||||
Amortization of intangibles | 255 | 108 | 201 | 54 | 54 | 55 | 54 | |||||||||||||||||||||
Merger and restructuring charges, | ||||||||||||||||||||||||||||
net of tax benefit | 83 | — | 83 | — | — | — | — | |||||||||||||||||||||
Capital charge | (3,872 | ) | (2,716 | ) | (2,542 | ) | (1,330 | ) | (1,337 | ) | (1,353 | ) | (1,378 | ) | ||||||||||||||
Shareholder value added | $ | 2,996 | $ | 2,554 | $ | 1,591 | $ | 1,405 | $ | 1,443 | $ | 1,624 | $ | 1,414 | ||||||||||||||
Certain prior period amounts have been reclassified to conform to current period presentation.
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
3
Bank of America Corporation
Consolidated Statement of Income
(Dollars in millions, except per share information; shares in thousands)
Year-to- Date 2004 | Year-to- Date 2003 | Second Quarter 2004 | First Quarter 2004 | Fourth Quarter 2003 | Third Quarter 2003 | Second Quarter 2003 | ||||||||||||||||
Interest income | ||||||||||||||||||||||
Interest and fees on loans and leases | $ | 12,786 | $ | 10,760 | $ | 7,237 | $ | 5,549 | $ | 5,580 | $ | 5,328 | $ | 5,412 | ||||||||
Interest on debt securities | 3,119 | 1,742 | 1,907 | 1,212 | 726 | 600 | 988 | |||||||||||||||
Federal funds sold and securities purchased under agreements to resell | 847 | 387 | 413 | 434 | 506 | 480 | 193 | |||||||||||||||
Trading account assets | 2,020 | 2,049 | 1,011 | 1,009 | 911 | 975 | 1,007 | |||||||||||||||
Other interest income | 808 | 782 | 440 | 368 | 345 | 472 | 395 | |||||||||||||||
Total interest income | 19,580 | 15,720 | 11,008 | 8,572 | 8,068 | 7,855 | 7,995 | |||||||||||||||
Interest expense | ||||||||||||||||||||||
Deposits | 2,735 | 2,452 | 1,529 | 1,206 | 1,178 | 1,278 | 1,269 | |||||||||||||||
Short-term borrowings | 1,777 | 967 | 1,037 | 740 | 537 | 447 | 514 | |||||||||||||||
Trading account liabilities | 632 | 624 | 298 | 334 | 317 | 345 | 316 | |||||||||||||||
Long-term debt | 1,054 | 1,103 | 563 | 491 | 450 | 481 | 531 | |||||||||||||||
Total interest expense | 6,198 | 5,146 | 3,427 | 2,771 | 2,482 | 2,551 | 2,630 | |||||||||||||||
Net interest income | 13,382 | 10,574 | 7,581 | 5,801 | 5,586 | 5,304 | 5,365 | |||||||||||||||
Noninterest income | ||||||||||||||||||||||
Service charges | 3,199 | 2,724 | 1,783 | 1,416 | 1,436 | 1,458 | 1,370 | |||||||||||||||
Investment and brokerage services | 1,594 | 1,158 | 972 | 622 | 619 | 594 | 610 | |||||||||||||||
Mortgage banking income | 508 | 964 | 299 | 209 | 292 | 666 | 559 | |||||||||||||||
Investment banking income | 951 | 866 | 547 | 404 | 458 | 412 | 488 | |||||||||||||||
Equity investment gains (losses) | 217 | (25 | ) | 84 | 133 | 215 | 25 | 43 | ||||||||||||||
Card income | 1,951 | 1,443 | 1,156 | 795 | 815 | 794 | 762 | |||||||||||||||
Trading account profits | 416 | 207 | 413 | 3 | 27 | 175 | 93 | |||||||||||||||
Other income | 321 | 618 | 186 | 135 | 187 | 322 | 337 | |||||||||||||||
Total noninterest income | 9,157 | 7,955 | 5,440 | 3,717 | 4,049 | 4,446 | 4,262 | |||||||||||||||
Total revenue | 22,539 | 18,529 | 13,021 | 9,518 | 9,635 | 9,750 | 9,627 | |||||||||||||||
Provision for credit losses | 1,413 | 1,605 | 789 | 624 | 583 | 651 | 772 | |||||||||||||||
Gains on sales of debt securities | 1,290 | 569 | 795 | 495 | 139 | 233 | 296 | |||||||||||||||
Noninterest expense | ||||||||||||||||||||||
Personnel | 6,401 | 5,154 | 3,639 | 2,762 | 2,697 | 2,595 | 2,695 | |||||||||||||||
Occupancy | 1,109 | 970 | 621 | 488 | 514 | 522 | 498 | |||||||||||||||
Equipment | 579 | 537 | 318 | 261 | 263 | 252 | 253 | |||||||||||||||
Marketing | 648 | 468 | 367 | 281 | 268 | 249 | 238 | |||||||||||||||
Professional fees | 327 | 406 | 180 | 147 | 224 | 214 | 281 | |||||||||||||||
Amortization of intangibles | 255 | 108 | 201 | 54 | 54 | 55 | 54 | |||||||||||||||
Data processing | 614 | 528 | 330 | 284 | 301 | 275 | 262 | |||||||||||||||
Telecommunications | 334 | 261 | 183 | 151 | 158 | 152 | 137 | |||||||||||||||
Other general operating | 2,226 | 1,358 | 1,237 | 989 | 809 | 763 | 647 | |||||||||||||||
Merger and restructuring charges | 125 | — | 125 | — | — | — | — | |||||||||||||||
Total noninterest expense | 12,618 | 9,790 | 7,201 | 5,417 | 5,288 | 5,077 | 5,065 | |||||||||||||||
Income before income taxes | 9,798 | 7,703 | 5,826 | 3,972 | 3,903 | 4,255 | 4,086 | |||||||||||||||
Income tax expense | 3,268 | 2,541 | 1,977 | 1,291 | 1,177 | 1,333 | 1,348 | |||||||||||||||
Net income | $ | 6,530 | $ | 5,162 | $ | 3,849 | $ | 2,681 | $ | 2,726 | $ | 2,922 | $ | 2,738 | ||||||||
Net income available to common shareholders | $ | 6,524 | $ | 5,160 | $ | 3,844 | $ | 2,680 | $ | 2,725 | $ | 2,921 | $ | 2,737 | ||||||||
Per common share information | ||||||||||||||||||||||
Earnings | $ | 3.76 | $ | 3.45 | $ | 1.89 | $ | 1.86 | $ | 1.86 | $ | 1.96 | $ | 1.83 | ||||||||
Diluted earnings | $ | 3.70 | $ | 3.39 | $ | 1.86 | $ | 1.83 | $ | 1.83 | $ | 1.92 | $ | 1.80 | ||||||||
Dividends paid | $ | 1.60 | $ | 1.28 | $ | 0.80 | $ | 0.80 | $ | 0.80 | $ | 0.80 | $ | 0.64 | ||||||||
Average common shares issued and outstanding | 1,735,758 | 1,496,827 | 2,031,192 | 1,440,153 | 1,463,247 | 1,490,103 | 1,494,094 | |||||||||||||||
Average diluted common shares issued and outstanding | 1,765,519 | 1,524,715 | 2,065,645 | 1,466,701 | 1,489,481 | 1,519,641 | 1,523,306 | |||||||||||||||
Certain prior period amounts have been reclassified to conform to current period presentation.
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
4
Bank of America Corporation
Consolidated Balance Sheet
(Dollars in millions) | June 30 2004 | March 31 2004 | June 30 2003 | |||||||||
Assets | ||||||||||||
Cash and cash equivalents | $ | 31,789 | $ | 22,296 | $ | 25,220 | ||||||
Time deposits placed and other short-term investments | 10,418 | 8,561 | 6,790 | |||||||||
Federal funds sold and securities purchased under agreements to resell | 81,437 | 73,057 | 64,314 | |||||||||
Trading account assets | 85,972 | 75,004 | 66,947 | |||||||||
Derivative assets | 32,241 | 36,488 | 38,587 | |||||||||
Debt securities: | ||||||||||||
Available-for-sale | 166,175 | 139,546 | 112,646 | |||||||||
Held-to-maturity, at cost | 478 | 242 | 279 | |||||||||
Total debt securities | 166,653 | 139,788 | 112,925 | |||||||||
Loans and leases | 498,481 | 375,968 | 360,305 | |||||||||
Allowance for loan and lease losses | (8,767 | ) | (6,080 | ) | (6,366 | ) | ||||||
Loans and leases, net of allowance | 489,714 | 369,888 | 353,939 | |||||||||
Premises and equipment, net | 7,797 | 6,076 | 5,899 | |||||||||
Mortgage banking assets | 3,005 | 2,184 | 1,748 | |||||||||
Goodwill | 44,672 | 11,468 | 11,426 | |||||||||
Core deposit intangibles and other intangibles | 3,922 | 854 | 1,010 | |||||||||
Other assets | 79,582 | 70,348 | 80,849 | |||||||||
Total assets | $ | 1,037,202 | $ | 816,012 | $ | 769,654 | ||||||
Liabilities | ||||||||||||
Deposits in domestic offices: | ||||||||||||
Noninterest-bearing | $ | 154,061 | $ | 121,629 | $ | 132,851 | ||||||
Interest-bearing | 369,446 | 267,850 | 256,602 | |||||||||
Deposits in foreign offices: | ||||||||||||
Noninterest-bearing | 5,499 | 2,805 | 2,206 | |||||||||
Interest-bearing | 46,407 | 43,308 | 30,276 | |||||||||
Total deposits | 575,413 | 435,592 | 421,935 | |||||||||
Federal funds purchased and securities sold under agreements to repurchase | 119,264 | 115,434 | 104,821 | |||||||||
Trading account liabilities | 29,689 | 27,402 | 27,708 | |||||||||
Derivative liabilities | 20,519 | 24,321 | 23,435 | |||||||||
Commercial paper and other short-term borrowings | 69,495 | 64,621 | 43,584 | |||||||||
Accrued expenses and other liabilities (includes $486, $401 and $475 of Reserve for unfunded lending commitments) | 28,682 | 18,635 | 29,418 | |||||||||
Long-term debt | 98,319 | 81,231 | 61,681 | |||||||||
Trust preferred securities | — | — | 6,056 | |||||||||
Total liabilities | 941,381 | 767,236 | 718,638 | |||||||||
Shareholders’ equity | ||||||||||||
Preferred stock, $0.01 par value; authorized - 100,000,000 shares; issued and | ||||||||||||
outstanding 2,292,013; 1,239,563 and 1,306,463 shares | 322 | 53 | 56 | |||||||||
Common stock, $0.01 par value; authorized - 7,500,000,000 shares; issued and | ||||||||||||
outstanding 2,031,328,433; 1,445,487,313; and 1,496,314,280 shares | 45,654 | 14 | 15 | |||||||||
Retained earnings | 54,045 | 51,823 | 51,374 | |||||||||
Accumulated other comprehensive loss | (3,862 | ) | (2,743 | ) | (251 | ) | ||||||
Other | (338 | ) | (371 | ) | (178 | ) | ||||||
Total shareholders’ equity | 95,821 | 48,776 | 51,016 | |||||||||
Total liabilities and shareholders’ equity | $ | 1,037,202 | $ | 816,012 | $ | 769,654 | ||||||
Certain prior period amounts have been reclassified to conform to current period presentation.
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
5
Bank of America Corporation
Capital Management
(Dollars in millions)
2Q04* | 1Q04 | 4Q03 | 3Q03 | 2Q03 | ||||||||||||||||
Tier 1 capital | $ | 61,882 | $ | 45,515 | $ | 44,050 | $ | 46,094 | $ | 45,192 | ||||||||||
Total capital | 89,268 | 67,484 | 66,651 | 67,991 | 66,843 | |||||||||||||||
Risk-weighted assets | 754,386 | 588,770 | 561,294 | 558,472 | 559,324 | |||||||||||||||
Tier 1 capital ratio | 8.20 | % | 7.73 | % | 7.85 | % | 8.25 | % | 8.08 | % | ||||||||||
Total capital ratio | 11.83 | 11.46 | 11.87 | 12.17 | 11.95 | |||||||||||||||
Ending equity / ending assets | 9.24 | 5.98 | 6.52 | 6.84 | 6.63 | |||||||||||||||
Ending capital / ending assets | 10.13 | 6.72 | 7.34 | 7.69 | 7.42 | |||||||||||||||
Average equity / average assets | 8.42 | 5.73 | 6.19 | 6.22 | 6.49 | |||||||||||||||
Leverage ratio | 5.83 | 5.43 | 5.73 | 5.95 | 5.92 |
* | Preliminary data on risk-based capital |
Share Repurchase Program
25 million common shares were repurchased in the second quarter of 2004 as a part of ongoing share repurchase programs.
78 million shares remain outstanding under the 2004 authorized program.
610 million shares were issued in the second quarter of 2004, with 593 million issued due to the Fleet acquistion.
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
6
Bank of America Corporation
Quarterly Average Balances and Interest Rates - Fully Taxable-equivalent Basis
(Dollars in millions)
Second Quarter 2004 | First Quarter 2004 | Second Quarter 2003 | |||||||||||||||||||||||||
Average Balance | Interest Income/ Expense | Yield/ Rate | Average Balance | Interest Income/ Expense | Yield/ Rate | Average Balance | Interest Income/ Expense | Yield/ Rate | |||||||||||||||||||
Earning assets | |||||||||||||||||||||||||||
Time deposits placed and other short-term investments | $ | 14,384 | $ | 59 | 1.65 | % | $ | 12,268 | $ | 48 | 1.57 | % | $ | 7,888 | $ | 39 | 1.99 | % | |||||||||
Federal funds sold and securities purchased under agreements to resell | 124,383 | 413 | 1.33 | 113,761 | 434 | 1.53 | 70,054 | 194 | 1.11 | ||||||||||||||||||
Trading account assets | 104,391 | 1,027 | 3.94 | 105,033 | 1,023 | 3.90 | 99,129 | 1,022 | 4.13 | ||||||||||||||||||
Debt securities | 159,797 | 1,925 | 4.82 | 99,755 | 1,223 | 4.91 | 94,017 | 1,005 | 4.28 | ||||||||||||||||||
Loans and leases(1): | |||||||||||||||||||||||||||
Commercial - domestic | 123,970 | 1,843 | 5.98 | 90,946 | 1,511 | 6.68 | 95,089 | 1,690 | 7.13 | ||||||||||||||||||
Commercial - foreign | 18,144 | 237 | 5.24 | 10,753 | 95 | 3.57 | 13,528 | 125 | 3.70 | ||||||||||||||||||
Commercial real estate - domestic | 29,920 | 313 | 4.20 | 19,491 | 207 | 4.27 | 20,039 | 218 | 4.36 | ||||||||||||||||||
Commercial real estate - foreign | 391 | 4 | 4.26 | 324 | 3 | 3.63 | 305 | 3 | 3.95 | ||||||||||||||||||
Commercial lease financing | 20,086 | 237 | 4.72 | 9,459 | 95 | 4.00 | 10,108 | 101 | 3.98 | ||||||||||||||||||
Total commercial | 192,511 | 2,634 | 5.50 | 130,973 | 1,911 | 5.87 | 139,069 | 2,137 | 6.16 | ||||||||||||||||||
Residential mortgage | 173,158 | 2,284 | 5.29 | 141,898 | 1,960 | 5.53 | 120,754 | 1,703 | 5.64 | ||||||||||||||||||
Home equity lines | 40,424 | 450 | 4.48 | 24,379 | 262 | 4.31 | 22,763 | 263 | 4.64 | ||||||||||||||||||
Direct/Indirect consumer | 39,763 | 540 | 5.44 | 34,045 | 464 | 5.49 | 32,248 | 495 | 6.17 | ||||||||||||||||||
Consumer finance | 8,142 | 169 | 8.32 | 7,479 | 120 | 6.42 | 9,234 | 154 | 6.69 | ||||||||||||||||||
Credit card | 43,160 | 1,167 | 10.88 | 35,303 | 870 | 9.92 | 26,211 | 690 | 10.56 | ||||||||||||||||||
Total consumer | 304,647 | 4,610 | 6.07 | 243,104 | 3,676 | 6.07 | 211,210 | 3,305 | 6.27 | ||||||||||||||||||
Total loans and leases | 497,158 | 7,244 | 5.85 | 374,077 | 5,587 | 6.00 | 350,279 | 5,442 | 6.23 | ||||||||||||||||||
Other earning assets | 44,877 | 510 | 4.57 | 38,817 | 426 | 4.41 | 42,133 | 452 | 4.30 | ||||||||||||||||||
Total earning assets(2) | 944,990 | 11,178 | 4.75 | 743,711 | 8,741 | 4.72 | 663,500 | 8,154 | 4.92 | ||||||||||||||||||
Cash and cash equivalents | 30,320 | 23,187 | 23,203 | ||||||||||||||||||||||||
Other assets, less allowance for loan and lease losses | 132,997 | 82,729 | 88,381 | ||||||||||||||||||||||||
Total assets | $ | 1,108,307 | $ | 849,627 | $ | 775,084 | |||||||||||||||||||||
Interest-bearing liabilities | |||||||||||||||||||||||||||
Domestic interest-bearing deposits: | |||||||||||||||||||||||||||
Savings | $ | 35,864 | $ | 31 | 0.34 | % | $ | 26,159 | $ | 17 | 0.27 | % | $ | 24,420 | $ | 35 | 0.58 | % | |||||||||
NOW and money market deposit accounts | 233,702 | 488 | 0.84 | 155,835 | 321 | 0.83 | 146,284 | 295 | 0.81 | ||||||||||||||||||
Consumer CDs and IRAs | 93,017 | 587 | 2.54 | 75,341 | 567 | 3.03 | 69,506 | 742 | 4.28 | ||||||||||||||||||
Negotiable CDs, public funds and other time deposits | 4,737 | 66 | 5.62 | 5,939 | 74 | 5.01 | 12,912 | 45 | 1.41 | ||||||||||||||||||
Total domestic interest-bearing deposits | 367,320 | 1,172 | 1.28 | 263,274 | 979 | 1.50 | 253,122 | 1,117 | 1.77 | ||||||||||||||||||
Foreign interest-bearing deposits(3): | |||||||||||||||||||||||||||
Banks located in foreign countries | 18,945 | 287 | 6.10 | 18,954 | 171 | 3.62 | 16,150 | 87 | 2.16 | ||||||||||||||||||
Governments and official institutions | 5,739 | 23 | 1.58 | 4,701 | 19 | 1.63 | 2,392 | 8 | 1.42 | ||||||||||||||||||
Time, savings and other | 29,882 | 47 | 0.64 | 21,054 | 37 | 0.71 | 19,209 | 57 | 1.18 | ||||||||||||||||||
Total foreign interest-bearing deposits | 54,566 | 357 | 2.63 | 44,709 | 227 | 2.04 | 37,751 | 152 | 1.61 | ||||||||||||||||||
Total interest-bearing deposits | 421,886 | 1,529 | 1.46 | 307,983 | 1,206 | 1.57 | 290,873 | 1,269 | 1.75 | ||||||||||||||||||
Federal funds purchased, securities sold under agreements to repurchase and other short-term borrowings | 243,079 | 1,038 | 1.72 | 203,398 | 739 | 1.46 | 152,722 | 514 | 1.35 | ||||||||||||||||||
Trading account liabilities | 31,620 | 297 | 3.78 | 34,543 | 335 | 3.90 | 38,610 | 316 | 3.28 | ||||||||||||||||||
Long-term debt(4) | 96,395 | 563 | 2.34 | 78,852 | 491 | 2.49 | 68,927 | 531 | 3.08 | ||||||||||||||||||
Total interest-bearing liabilities(2) | 792,980 | 3,427 | 1.74 | 624,776 | 2,771 | 1.78 | 551,132 | 2,630 | 1.91 | ||||||||||||||||||
Noninterest-bearing sources: | |||||||||||||||||||||||||||
Noninterest-bearing deposits | 160,419 | 117,092 | 114,434 | ||||||||||||||||||||||||
Other liabilities | 61,642 | 59,073 | 59,249 | ||||||||||||||||||||||||
Shareholders’ equity | 93,266 | 48,686 | 50,269 | ||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 1,108,307 | $ | 849,627 | $ | 775,084 | |||||||||||||||||||||
Net interest spread | 3.01 | 2.94 | 3.01 | ||||||||||||||||||||||||
Impact of noninterest-bearing sources | 0.28 | 0.28 | 0.32 | ||||||||||||||||||||||||
Net interest income/yield on earning assets | $ | 7,751 | 3.29 | % | $ | 5,970 | 3.22 | % | $ | 5,524 | 3.33 | % | |||||||||||||||
(1) | Nonperforming loans are included in the respective average loan balances. Income on such nonperforming loans is recognized on a cash basis. |
(2) | Interest income includes the impact of interest rate risk management contracts, which increased interest income on the underlying assets $659 and $715 in the second and first quarters of 2004, respectively, and $587 in the second quarter of 2003. These amounts were substantially offset by corresponding decreases in the income earned on the underlying assets. Interest expense includes the impact of interest rate risk management contracts, which increased interest expense on the underlying liabilities $333 and $183 in the second and first quarters of 2004, respectively, and $28 in the second quarter of 2003. These amounts were substantially offset by corresponding decreases in the interest paid on the underlying liabilities. |
(3) | Primarily consists of time deposits in denominations of $100,000 or more. |
(4) | Includes long-term debt related to trust preferred securities. |
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
7
Bank of America Corporation
Year-to-Date Average Balances and Interest Rates - Fully Taxable-equivalent Basis
(Dollars in millions)
Six Months Ended June 30 | ||||||||||||||||||
2004 | 2003 | |||||||||||||||||
Average Balance | Interest Income/ Expense | Yield/ Rate | Average Balance | Interest Income/ Expense | Yield/ Rate | |||||||||||||
Earning assets | ||||||||||||||||||
Time deposits placed and other short-term investments | $ | 13,326 | $ | 107 | 1.61 | % | $ | 7,440 | $ | 82 | 2.22 | % | ||||||
Federal funds sold and securities purchased under agreements to resell | 119,072 | 847 | 1.43 | 63,997 | 388 | 1.22 | ||||||||||||
Trading account assets | 104,712 | 2,050 | 3.92 | 99,107 | 2,075 | 4.20 | ||||||||||||
Debt securities | 129,776 | 3,148 | 4.85 | 80,178 | 1,774 | 4.43 | ||||||||||||
Loans and leases(1): | ||||||||||||||||||
Commercial - domestic | 107,457 | 3,354 | 6.28 | 96,473 | 3,457 | 7.23 | ||||||||||||
Commercial - foreign | 14,449 | 332 | 4.62 | 13,935 | 248 | 3.59 | ||||||||||||
Commercial real estate - domestic | 24,706 | 520 | 4.23 | 19,997 | 433 | 4.36 | ||||||||||||
Commercial real estate - foreign | 357 | 7 | 3.98 | 303 | 6 | 3.92 | ||||||||||||
Commercial lease financing | 14,773 | 332 | 4.49 | 10,213 | 203 | 3.98 | ||||||||||||
Total commercial | 161,742 | 4,545 | 5.65 | 140,921 | 4,347 | 6.22 | ||||||||||||
Residential mortgage | 157,528 | 4,244 | 5.40 | 117,243 | 3,285 | 5.62 | ||||||||||||
Home equity lines | 32,402 | 712 | 4.42 | 22,908 | 531 | 4.67 | ||||||||||||
Direct/Indirect consumer | 36,904 | 1,004 | 5.47 | 31,824 | 998 | 6.32 | ||||||||||||
Consumer finance | 7,810 | 289 | 7.41 | 9,635 | 325 | 6.79 | ||||||||||||
Credit card | 39,232 | 2,037 | 10.44 | 25,452 | 1,333 | 10.57 | ||||||||||||
Total consumer | 273,876 | 8,286 | 6.07 | 207,062 | 6,472 | 6.28 | ||||||||||||
Total loans and leases | 435,618 | 12,831 | 5.91 | 347,983 | 10,819 | 6.26 | ||||||||||||
Other earning assets | 41,846 | 936 | 4.49 | 39,730 | 893 | 4.52 | ||||||||||||
Total earning assets(2) | 844,350 | 19,919 | 4.73 | 638,435 | 16,031 | 5.05 | ||||||||||||
Cash and cash equivalents | 26,754 | 22,455 | ||||||||||||||||
Other assets, less allowance for loan and lease losses | 107,863 | 83,712 | ||||||||||||||||
Total assets | $ | 978,967 | $ | 744,602 | ||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||
Domestic interest-bearing deposits: | ||||||||||||||||||
Savings | $ | 31,012 | $ | 48 | 0.31 | % | $ | 23,672 | $ | 69 | 0.59 | % | ||||||
NOW and money market deposit accounts | 194,768 | 809 | 0.84 | 144,322 | 586 | 0.82 | ||||||||||||
Consumer CDs and IRAs | 84,179 | 1,154 | 2.76 | 68,228 | 1,437 | 4.25 | ||||||||||||
Negotiable CDs, public funds and other time deposits | 5,338 | 140 | 5.28 | 8,281 | 61 | 1.49 | ||||||||||||
Total domestic interest-bearing deposits | 315,297 | 2,151 | 1.37 | 244,503 | 2,153 | 1.78 | ||||||||||||
Foreign interest-bearing deposits(3): | ||||||||||||||||||
Banks located in foreign countries | 18,950 | 458 | 4.86 | 15,189 | 167 | 2.21 | ||||||||||||
Governments and official institutions | 5,220 | 42 | 1.60 | 2,090 | 14 | 1.37 | ||||||||||||
Time, savings and other | 25,468 | 84 | 0.67 | 18,643 | 118 | 1.27 | ||||||||||||
Total foreign interest-bearing deposits | 49,638 | 584 | 2.37 | 35,922 | 299 | 1.68 | ||||||||||||
Total interest-bearing deposits | 364,935 | 2,735 | 1.51 | 280,425 | 2,452 | 1.76 | ||||||||||||
Federal funds purchased, securities sold under agreements to repurchase and other short-term borrowings | 223,238 | 1,777 | 1.60 | 137,964 | 967 | 1.41 | ||||||||||||
Trading account liabilities | 33,082 | 632 | 3.84 | 36,745 | 624 | 3.42 | ||||||||||||
Long-term debt(4) | 87,623 | 1,054 | 2.41 | 68,167 | 1,103 | 3.24 | ||||||||||||
Total interest-bearing liabilities(2) | 708,878 | 6,198 | 1.76 | 523,301 | 5,146 | 1.98 | ||||||||||||
Noninterest-bearing sources: | ||||||||||||||||||
Noninterest-bearing deposits | 138,755 | 115,162 | ||||||||||||||||
Other liabilities | 60,358 | 56,302 | ||||||||||||||||
Shareholders’ equity | 70,976 | 49,837 | ||||||||||||||||
Total liabilities and shareholders’ equity | $ | 978,967 | $ | 744,602 | ||||||||||||||
Net interest spread | 2.97 | 3.07 | ||||||||||||||||
Impact of noninterest-bearing sources | 0.29 | 0.35 | ||||||||||||||||
Net interest income/yield on earning assets | $ | 13,721 | 3.26 | % | $ | 10,885 | 3.42 | % | ||||||||||
(1) | Nonperforming loans are included in the respective average loan balances. Income on such nonperforming loans is recognized on a cash basis. |
(2) | Interest income includes the impact of interest rate risk management contracts, which increased interest income on the underlying assets $1,373 and $1,163 in the six months ended June 30, 2004 and 2003, respectively. These amounts were substantially offset by corresponding decreases in the income earned on the underlying assets. Interest expense includes the impact of interest rate risk management contracts, which increased interest expense on the underlying liabilities $516 and $74 in the six months ended June 30, 2004 and 2003, respectively. These amounts were substantially offset by corresponding decreases in the interest paid on the underlying liabilities. |
(3) | Primarily consists of time deposits in denominations of $100,000 or more. |
(4) | Includes long-term debt related to trust preferred securities. |
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
8
Bank of America Corporation
Business Segment View
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
9
Bank of America Corporation
Consumer and Small Business Banking Segment Results(1)
(Dollars in millions)
Year-to-Date | Quarterly | |||||||||||||||||||||||||||
2004 | 2003 | 2 Qtr 04 | 1 Qtr 04 | 4 Qtr 03 | 3 Qtr 03 | 2 Qtr 03 | ||||||||||||||||||||||
Key Measures | ||||||||||||||||||||||||||||
Total revenue(2) | $ | 12,231 | $ | 9,981 | $ | 7,149 | $ | 5,082 | $ | 5,317 | $ | 5,540 | $ | 5,224 | ||||||||||||||
Provision for credit losses | 1,097 | 822 | 661 | 436 | 447 | 408 | 405 | |||||||||||||||||||||
Net income | 3,121 | 2,566 | 1,910 | 1,211 | 1,416 | 1,669 | 1,408 | |||||||||||||||||||||
Shareholder value added | 1,867 | 2,013 | 1,036 | 831 | 1,087 | 1,378 | 1,130 | |||||||||||||||||||||
Return on average equity | 24.01 | % | 45.11 | % | 20.74 | % | 31.95 | % | 42.56 | % | 55.88 | % | 49.19 | % | ||||||||||||||
Efficiency ratio(2) | 50.64 | 50.99 | 48.54 | 53.58 | 50.75 | 45.82 | 49.54 | |||||||||||||||||||||
Selected Average Balance Sheet Components | ||||||||||||||||||||||||||||
Total loans and leases | $ | 122,119 | $ | 91,575 | $ | 145,830 | $ | 98,408 | $ | 95,412 | $ | 92,511 | $ | 91,497 | ||||||||||||||
Total deposits | 290,978 | 233,554 | 339,569 | 242,386 | 248,187 | 246,074 | 236,625 | |||||||||||||||||||||
Total earning assets | 297,265 | 233,372 | 347,454 | 247,077 | 250,994 | 247,731 | 236,630 | |||||||||||||||||||||
Period End(in billions) | ||||||||||||||||||||||||||||
Mortgage servicing portfolio | $ | 253.3 | $ | 249.6 | $ | 253.3 | $ | 247.6 | $ | 246.5 | $ | 245.9 | $ | 249.6 | ||||||||||||||
Mortgage originations: | ||||||||||||||||||||||||||||
Retail | 19.2 | 28.2 | 19.2 | 14.1 | 11.7 | 30.0 | 28.2 | |||||||||||||||||||||
Wholesale | 9.3 | 12.2 | 9.3 | 9.8 | 6.7 | 9.5 | 12.2 |
(1) | Consumer and Small Business major subsegments are Consumer Banking, Consumer Products, and Small Business. |
(2) | Fully taxable-equivalent basis |
Certain prior period amounts have been reclassified among the segments to conform to the current period presentation.
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
10
Bank of America Corporation
Consumer Customer Growth Momentum
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
11
Bank of America Corporation
E-Commerce & BankofAmerica.com
Bank of America has the largest active online banking customer base with 11.2 million subscribers. This represents an active customer penetration rate of 47.7%.
Bank of America uses a strict Active User standard - customers must have used our online services within the last 90 days.
4.5 millionactive bill pay users paid $21.1 billion worth of bills this quarter. The number of customers who sign up and use Bank of America's Bill Pay Service continues to far surpass that of any other financial institution.
Currently, approximately 300 companies are presenting 9.8 million e-bills per quarter.
Results for 2nd quarter 2004 include Fleet.
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
12
Bank of America Corporation
Consumer Credit Card Results
Included within Consumer Products
(Dollars in millions)
Year-to-Date | Quarterly | |||||||||||||||||||||||||||
2004 | 2003 | 2 Qtr 04 | 1 Qtr 04 | 4 Qtr 03 | 3 Qtr 03 | 2 Qtr 03 | ||||||||||||||||||||||
Key Measures | ||||||||||||||||||||||||||||
Outstandings: | ||||||||||||||||||||||||||||
Held (Period end) | $ | 42,195 | $ | 27,419 | $ | 42,195 | $ | 36,087 | $ | 34,814 | $ | 30,993 | $ | 27,419 | ||||||||||||||
Managed (Period end) | 51,990 | 30,807 | 51,990 | 37,296 | 36,596 | 33,631 | 30,807 | |||||||||||||||||||||
Held (Average) | 39,240 | 25,451 | 43,177 | 35,303 | 32,734 | 29,113 | 26,211 | |||||||||||||||||||||
Managed (Average) | 44,996 | 29,567 | 53,136 | 36,855 | 34,783 | 32,225 | 29,970 | |||||||||||||||||||||
Managed Income Statement: | ||||||||||||||||||||||||||||
Total revenue | $ | 3,192 | $ | 2,011 | $ | 1,954 | $ | 1,238 | $ | 1,196 | $ | 1,134 | $ | 1,044 | ||||||||||||||
Provision for credit losses | 1,226 | 882 | 760 | 466 | 555 | 539 | 473 | |||||||||||||||||||||
Noninterest expense | 891 | 545 | 553 | 338 | 312 | 270 | 274 | |||||||||||||||||||||
Income before income taxes | $ | 1,075 | $ | 584 | $ | 641 | $ | 434 | $ | 329 | $ | 325 | $ | 297 | ||||||||||||||
Shareholder Value Added | $ | 542 | $ | 264 | $ | 338 | $ | 204 | $ | 152 | $ | 150 | $ | 135 | ||||||||||||||
Credit Quality: | ||||||||||||||||||||||||||||
Held: | ||||||||||||||||||||||||||||
Charge-offs $ | $ | 1,028 | $ | 701 | $ | 585 | $ | 443 | $ | 423 | $ | 390 | $ | 378 | ||||||||||||||
Charge-offs % | 5.31 | % | 5.56 | % | 5.45 | % | 5.05 | % | 5.12 | % | 5.32 | % | 5.78 | % | ||||||||||||||
Managed: | ||||||||||||||||||||||||||||
Losses $ | $ | 1,239 | $ | 807 | $ | 776 | $ | 463 | $ | 451 | $ | 433 | $ | 429 | ||||||||||||||
Losses % | 5.54 | % | 5.50 | % | 5.88 | % | 5.05 | % | 5.14 | % | 5.33 | % | 5.74 | % | ||||||||||||||
Managed Delinquency %: | ||||||||||||||||||||||||||||
30+ | 3.80 | % | 3.99 | % | 3.86 | % | 3.75 | % | 3.93 | % | 3.84 | % | 3.99 | % | ||||||||||||||
90+ | 1.79 | 1.81 | 1.76 | 1.81 | 1.77 | 1.76 | 1.80 |
Certain prior period amounts have been reclassified among the segments to conform to the current period presentation.
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
13
Bank of America Corporation
Commercial Banking Segment Results(1)
(Dollars in millions)
Year-to-Date | Quarterly | |||||||||||||||||||||||||||
2004 | 2003 | 2 Qtr 04 | 1 Qtr 04 | 4 Qtr 03 | 3 Qtr 03 | 2 Qtr 03 | ||||||||||||||||||||||
Key Measures | ||||||||||||||||||||||||||||
Total revenue(2) | $ | 2,945 | $ | 2,203 | $ | 1,741 | $ | 1,204 | $ | 1,229 | $ | 1,190 | $ | 1,144 | ||||||||||||||
Provision for credit losses | 33 | 238 | 6 | 27 | 98 | 122 | 116 | |||||||||||||||||||||
Net income | 1,106 | 694 | 642 | 464 | 428 | 417 | 378 | |||||||||||||||||||||
Shareholder value added | 366 | 280 | 59 | 307 | 211 | 207 | 173 | |||||||||||||||||||||
Return on average equity | 15.78 | % | 17.96 | % | 11.60 | % | 31.42 | % | 21.20 | % | 21.36 | % | 19.78 | % | ||||||||||||||
Efficiency ratio(2) | 39.83 | 40.19 | 41.04 | 38.08 | 39.18 | 36.05 | 38.44 | |||||||||||||||||||||
Selected Average Balance Sheet Components | ||||||||||||||||||||||||||||
Total loans and leases | $ | 117,805 | $ | 92,518 | $ | 139,032 | $ | 96,577 | $ | 94,996 | $ | 93,451 | $ | 93,598 | ||||||||||||||
Total deposits | 47,120 | 30,122 | 59,605 | 34,636 | 34,053 | 31,505 | 30,751 | |||||||||||||||||||||
Total earning assets | 122,661 | 96,623 | 144,612 | 100,709 | 99,734 | 98,531 | 97,897 |
(1) | Commercial Banking major subsegments are Commercial Banking, Real Estate Banking and Other Commercial. |
(2) | Fully taxable-equivalent basis |
Certain prior period amounts have been reclassified among the segments to conform to the current period presentation.
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
14
Bank of America Corporation
Global Corporate and Investment Banking Segment Results(1)
(Dollars in millions)
Year-to-Date | Quarterly | |||||||||||||||||||||||||||
2004 | 2003 | 2 Qtr 04 | 1 Qtr 04 | 4 Qtr 03 | 3 Qtr 03 | 2 Qtr 03 | ||||||||||||||||||||||
Key Measures | ||||||||||||||||||||||||||||
Total revenue(2) | $ | 4,793 | $ | 4,337 | $ | 2,630 | $ | 2,163 | $ | 1,937 | $ | 2,066 | $ | 2,113 | ||||||||||||||
Provision for credit losses | (120 | ) | 337 | (21 | ) | (99 | ) | (83 | ) | 50 | 89 | |||||||||||||||||
Net income | 892 | 847 | 429 | 463 | 512 | 435 | 413 | |||||||||||||||||||||
Shareholder value added | 409 | 367 | 145 | 264 | 301 | 213 | 177 | |||||||||||||||||||||
Return on average equity | 19.57 | % | 18.93 | % | 15.91 | % | 24.86 | % | 25.94 | % | 21.00 | % | 18.78 | % | ||||||||||||||
Efficiency ratio(2) | 73.81 | 61.90 | 76.12 | 71.00 | 65.65 | 66.59 | 65.74 | |||||||||||||||||||||
Selected Average Balance Sheet Components | ||||||||||||||||||||||||||||
Total loans and leases | $ | 33,521 | $ | 40,931 | $ | 38,125 | $ | 28,917 | $ | 31,034 | $ | 33,805 | $ | 38,475 | ||||||||||||||
Total deposits | 75,081 | 67,024 | 81,060 | 69,102 | 62,998 | 67,368 | 66,809 | |||||||||||||||||||||
Total earning assets | 273,701 | 220,936 | 283,125 | 270,615 | 250,629 | 262,307 | 223,454 |
(1) | Global Corporate and Investment Banking offers clients a comprehensive range of global capabilities through three subsegments: Global Investment Banking, Global Credit Products and Global Treasury Services. |
(2) | Fully taxable-equivalent basis |
Certain prior period amounts have been reclassified among the segments to conform to the current period presentation.
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
15
Bank of America Corporation
Global Corporate & Investment Banking Strategic Progress Continues
Significant US market share gains
Banc of America Securities increased market share in leveraged loans, mergers & acquisitions, high yield, syndicated loans, public finance, and convertible debt while maintaining its position in mortgage-backed securities.
• | Top in leveraged loans at 22.6% market share |
• | #2 syndicated lender, ranked by dollar volume, with 20% market share |
• | #1 syndicated lender, ranked by # of deals |
• | Convertible debt earned the #3 position with 10.2% market share |
• | High yield debt market share increased over YTD03, from 9% to 11.8% |
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
16
Bank of America Corporation
Wealth and Investment Management Segment Results(1)
(Dollars in millions)
Year-to-Date | Quarterly | |||||||||||||||||||||||||||
2004 | 2003 | 2 Qtr 04 | 1 Qtr 04 | 4 Qtr 03 | 3 Qtr 03 | 2 Qtr 03 | ||||||||||||||||||||||
Key Measures | ||||||||||||||||||||||||||||
Total revenue(2) | $ | 2,608 | $ | 1,894 | $ | 1,513 | $ | 1,095 | $ | 1,213 | $ | 972 | $ | 987 | ||||||||||||||
Provision for credit losses | 2 | 5 | 11 | (9 | ) | 7 | (1 | ) | 5 | |||||||||||||||||||
Net income | 643 | 567 | 392 | 251 | 435 | 265 | 300 | |||||||||||||||||||||
Shareholder value added | 286 | 340 | 172 | 114 | 298 | 147 | 186 | |||||||||||||||||||||
Return on average equity | 18.57 | % | 26.31 | % | 18.03 | % | 19.49 | % | 33.88 | % | 23.70 | % | 27.73 | % | ||||||||||||||
Efficiency ratio(2) | 61.15 | 52.43 | 58.66 | 64.59 | 44.47 | 58.34 | 51.50 | |||||||||||||||||||||
Selected Average Balance Sheet Components | ||||||||||||||||||||||||||||
Total loans and leases | $ | 41,270 | $ | 37,945 | $ | 44,107 | $ | 38,434 | $ | 37,660 | $ | 37,159 | $ | 37,617 | ||||||||||||||
Total deposits | 70,768 | 50,288 | 77,069 | 64,467 | 59,784 | 55,503 | 51,892 | |||||||||||||||||||||
Total earning assets | 74,125 | 52,213 | 81,160 | 67,091 | 62,815 | 57,839 | 53,921 | |||||||||||||||||||||
Period End (in billions) | ||||||||||||||||||||||||||||
Assets under management | $ | 439.6 | $ | 314.9 | $ | 439.6 | $ | 337.2 | $ | 335.7 | $ | 318.1 | $ | 314.9 | ||||||||||||||
Client brokerage assets | 144.9 | 90.6 | 144.9 | 91.0 | 88.8 | 90.7 | 90.6 | |||||||||||||||||||||
Assets in custody | 105.2 | 47.9 | 105.2 | 50.6 | 49.9 | 47.3 | 47.9 | |||||||||||||||||||||
Total client assets | $ | 689.7 | $ | 453.4 | $ | 689.7 | $ | 478.8 | $ | 474.4 | $ | 456.1 | $ | 453.4 | ||||||||||||||
(1) | Wealth and Investment Management includes four primary subsegments: Columbia Management Group, Private Bank, Brokerage and Premier Banking. |
(2) | Fully taxable-equivalent basis |
Certain prior period amounts have been reclassified among the segments to conform to the current period presentation.
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
17
Bank of America Corporation
Corporate Other Results(1)
(Dollars in millions)
Year-to-Date | Quarterly | |||||||||||||||||||||||||
2004 | 2003 | 2 Qtr 04 | 1 Qtr 04 | 4 Qtr 03 | 3 Qtr 03 | 2 Qtr 03 | ||||||||||||||||||||
Key Measures | ||||||||||||||||||||||||||
Total revenue(2) | $ | 301 | $ | 425 | $ | 158 | $ | 143 | $ | 98 | $ | 155 | $ | 318 | ||||||||||||
Provision for credit losses | 401 | 203 | 132 | 269 | 114 | 72 | 157 | |||||||||||||||||||
Net income(3) | 768 | 488 | 476 | 292 | (65 | ) | 136 | 239 | ||||||||||||||||||
Shareholder value added | 68 | (446 | ) | 179 | (111 | ) | (454 | ) | (321 | ) | (252 | ) | ||||||||||||||
Selected Average Balance Sheet Components | ||||||||||||||||||||||||||
Total loans and leases | $ | 120,903 | $ | 85,014 | $ | 130,064 | $ | 111,741 | $ | 111,969 | $ | 100,362 | $ | 89,092 | ||||||||||||
Total deposits | 19,743 | 14,599 | 25,002 | 14,484 | 13,817 | 14,119 | 19,230 | |||||||||||||||||||
Total earning assets | 272,819 | 181,085 | 311,496 | 234,144 | 192,423 | 183,799 | 200,253 |
Corporate Other Sub-Segment Results
Year-to-Date | Quarterly | |||||||||||||||||||||||||||
2004 | 2003 | 2 Qtr 04 | 1 Qtr 04 | 4 Qtr 03 | 3 Qtr 03 | 2 Qtr 03 | ||||||||||||||||||||||
Key Measures | ||||||||||||||||||||||||||||
Latin America(4) | ||||||||||||||||||||||||||||
Total revenue(3) | $ | 278 | $ | 32 | $ | 269 | $ | 9 | $ | 9 | $ | 10 | $ | 13 | ||||||||||||||
Provision for credit losses | 51 | 52 | (6 | ) | 57 | 25 | 12 | 82 | ||||||||||||||||||||
Net income | 33 | (20 | ) | 66 | (33 | ) | (14 | ) | (4 | ) | (47 | ) | ||||||||||||||||
Shareholder value added | (10 | ) | (39 | ) | 22 | (32 | ) | (21 | ) | (12 | ) | (57 | ) | |||||||||||||||
Equity Investments | ||||||||||||||||||||||||||||
Total revenue(2) | ($ | 19 | ) | ($ | 118 | ) | $ | 0 | ($ | 19 | ) | ($ | 55 | ) | ($ | 79 | ) | ($ | 11 | ) | ||||||||
Provision for credit losses | — | 4 | — | — | 21 | — | 3 | |||||||||||||||||||||
Net income | (47 | ) | (113 | ) | (17 | ) | (30 | ) | (66 | ) | (68 | ) | (28 | ) | ||||||||||||||
Shareholder value added | (182 | ) | (226 | ) | (97 | ) | (85 | ) | (125 | ) | (126 | ) | (85 | ) |
(1) | Corporate Other consists primarily of gains and losses associated with managing the balance sheet of the Corporation, Latin America operations, Equity Investments, certain consumer finance and commercial lending businesses being liquidated, and certain residential mortgages originated by the mortgage group or otherwise acquired and held for asset/liability management purposes. |
(2) | Fully taxable-equivalent basis |
(3) | Includes merger and restructuring charges, net of taxes, of $83 in year-to-date 2004 and 2Q04. |
(4) | Excludes Mexico, which is included in Global Corporate and Investment Banking. |
Certain prior period amounts have been reclassified among the segments to conform to the current period presentation.
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
18
Bank of America Corporation
Outstanding Loans and Leases
(Dollars in millions)
June 30 2004 | December 31 2003 | Increase (Decrease) from 12/31/03 | |||||||
Commercial - domestic | $ | 121,317 | $ | 91,491 | $ | 29,826 | |||
Commercial - foreign | 18,256 | 10,754 | 7,502 | ||||||
Commercial real estate - domestic | 30,519 | 19,043 | 11,476 | ||||||
Commercial real estate - foreign | 436 | 324 | 112 | ||||||
Commercial lease financing | 20,379 | 9,692 | 10,687 | ||||||
Total commercial | 190,907 | 131,304 | 59,603 | ||||||
Residential mortgage | 173,600 | 140,513 | 33,087 | ||||||
Home equity lines | 42,315 | 23,859 | 18,456 | ||||||
Direct/Indirect consumer | 39,252 | 33,415 | 5,837 | ||||||
Consumer finance(1) | 7,873 | 7,558 | 315 | ||||||
Credit card | 44,534 | 34,814 | 9,720 | ||||||
Total consumer | 307,574 | 240,159 | 67,415 | ||||||
Total | $ | 498,481 | $ | 371,463 | $ | 127,018 | |||
(1) | Includes foreign consumer of $3,268 and $1,969 and consumer lease financing of $867 and $1,684 at June 30, 2004 and December 31, 2003, respectively. |
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
19
Bank of America Corporation
Commercial Utilized Credit Exposure by Industry(1)
(Dollars in millions)
June 30, 2004 | December 31, 2003 | % Increase (Decrease) from 12/31/03 | |||||||
Real estate | $ | 36,668 | $ | 22,228 | 65 | % | |||
Retailing | 23,442 | 15,152 | 55 | ||||||
Diversified financials | 21,869 | 20,427 | 7 | ||||||
Banks | 18,924 | 25,088 | (25 | ) | |||||
Individuals and trusts | 16,888 | 14,307 | 18 | ||||||
Education and government | 16,011 | 13,919 | 15 | ||||||
Materials | 13,736 | 8,860 | 55 | ||||||
Consumer durables and apparel | 12,718 | 8,313 | 53 | ||||||
Leisure and sports, hotels and restaurants | 12,644 | 10,099 | 25 | ||||||
Transportation | 12,282 | 9,355 | 31 | ||||||
Health care equipment and services | 12,122 | 7,064 | 72 | ||||||
Capital goods | 11,785 | 8,244 | 43 | ||||||
Food, beverage and tobacco | 11,067 | 9,134 | 21 | ||||||
Commercial services and supplies | 10,924 | 7,206 | 52 | ||||||
Energy | 7,151 | 4,348 | 64 | ||||||
Media | 7,082 | 4,701 | 51 | ||||||
Utilities | 5,815 | 5,012 | 16 | ||||||
Insurance | 5,487 | 3,638 | 51 | ||||||
Religious and social organizations | 5,247 | 4,272 | 23 | ||||||
Food and staples retailing | 3,344 | 1,837 | 82 | ||||||
Technology hardware and equipment | 3,313 | 1,941 | 71 | ||||||
Telecommunication services | 2,801 | 2,526 | 11 | ||||||
Software and services | 2,451 | 1,655 | 48 | ||||||
Automobiles and components | 1,599 | 1,326 | 21 | ||||||
Pharmaceuticals and biotechnology | 998 | 466 | 114 | ||||||
Household and personal products | 367 | 302 | 22 | ||||||
Other | 6,915 | 1,474 | 369 | ||||||
Total | $ | 283,650 | $ | 212,894 | 33 | ||||
(1) | Includes commercial loans and leases, commercial letters of credit, standby letters of credit and financial guarantees as well as the mark-to-market exposure for derivatives. |
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
20
Bank of America Corporation
Nonperforming Assets
(Dollars in millions)
2Q04 | 1Q04 | 4Q03 | 3Q03 | 2Q03 | ||||||||||||||||
Commercial - domestic | $ | 1,246 | $ | 1,229 | $ | 1,388 | $ | 1,746 | $ | 2,170 | ||||||||||
Commercial - foreign | 503 | 331 | 578 | 756 | 1,040 | |||||||||||||||
Commercial real estate - domestic | 127 | 113 | 140 | 154 | 154 | |||||||||||||||
Commercial real estate - foreign | 37 | 2 | 2 | 3 | 2 | |||||||||||||||
Commercial lease financing | 257 | 66 | 127 | 114 | 95 | |||||||||||||||
Total commercial | 2,170 | 1,741 | 2,235 | 2,773 | 3,461 | |||||||||||||||
Residential mortgage | 537 | 486 | 531 | 563 | 618 | |||||||||||||||
Home equity lines | 42 | 35 | 43 | 42 | 55 | |||||||||||||||
Direct/Indirect consumer | 31 | 31 | 28 | 32 | 33 | |||||||||||||||
Consumer finance | 99 | 61 | 36 | 19 | 20 | |||||||||||||||
Total consumer | 709 | 613 | 638 | 656 | 726 | |||||||||||||||
Total nonperforming loans and leases | 2,879 | 2,354 | 2,873 | 3,429 | 4,187 | |||||||||||||||
Nonperforming securities | 156 | — | — | — | — | |||||||||||||||
Foreclosed properties | 144 | 131 | 148 | 228 | 243 | |||||||||||||||
Total nonperforming assets(1) | $ | 3,179 | $ | 2,485 | $ | 3,021 | $ | 3,657 | $ | 4,430 | ||||||||||
Loans past due 90 days or more and still accruing | $ | 939 | $ | 795 | $ | 860 | $ | 788 | $ | 726 | ||||||||||
Nonperforming assets / Total assets | 0.31 | % | 0.30 | % | 0.41 | % | 0.50 | % | 0.58 | % | ||||||||||
Nonperforming assets / Total loans, leases and foreclosed properties | 0.64 | 0.66 | 0.81 | 0.98 | 1.23 | |||||||||||||||
Nonperforming loans and leases / Total loans and leases | 0.58 | 0.63 | 0.77 | 0.92 | 1.16 | |||||||||||||||
Allowance for credit losses: | ||||||||||||||||||||
Allowance for loan and lease losses | $ | 8,767 | $ | 6,080 | $ | 6,163 | $ | 6,258 | $ | 6,366 | ||||||||||
Reserve for unfunded lending commitments | 486 | 401 | 416 | 458 | 475 | |||||||||||||||
Total | $ | 9,253 | $ | 6,481 | $ | 6,579 | $ | 6,716 | $ | 6,841 | ||||||||||
Allowance for loan and lease losses / Total loans and leases | 1.76 | % | 1.62 | % | 1.66 | % | 1.68 | % | 1.77 | % | ||||||||||
Allowance for loan and lease losses / Total nonperforming loans and leases | 305 | 258 | 215 | 183 | 152 | |||||||||||||||
Commercial Criticized Exposure | $ | 13,420 | $ | 10,401 | $ | 12,650 | $ | 15,059 | $ | 17,368 | ||||||||||
Commercial Criticized Exposure / Commercial Utilized Exposure | 4.73 | % | 4.94 | % | 5.94 | % | 7.10 | % | 8.00 | % |
Loans are classified as domestic or foreign based upon the domicile of the borrower.
(1) | Balances do not include $103, $82, $202, $82 and $98 of nonperforming assets included in other assets at June 30, 2004, March 31, 2004, December 31, 2003, September 30, 2003 and June 30, 2003, respectively. |
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
21
Bank of America Corporation
Quarterly Net Charge-offs and Net Charge-off Ratios
(Dollars in millions)
2Q04 | 1Q04 | 4Q03 | 3Q03 | 2Q03 | |||||||||||||||||||||||||||||
Amt. | Ratio | Amt. | Ratio | Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||||||||||
Commercial - domestic | $ | 72 | 0.23 | % | $ | 49 | 0.22 | % | $ | 93 | 0.41 | % | $ | 163 | 0.72 | % | $ | 210 | 0.88 | % | |||||||||||||
Commercial - foreign | 72 | 1.59 | 106 | 3.98 | 76 | 2.60 | 58 | 1.84 | 53 | 1.58 | |||||||||||||||||||||||
Commercial real estate - domestic | (5 | ) | (0.07 | ) | (2 | ) | (0.05 | ) | 9 | 0.18 | 13 | 0.26 | 10 | 0.21 | |||||||||||||||||||
Commercial lease financing | (3 | ) | (0.06 | ) | 4 | 0.17 | 0 | 0.00 | 40 | 1.61 | 11 | 0.44 | |||||||||||||||||||||
Total commercial | 136 | 0.28 | 157 | 0.48 | 178 | 0.54 | 274 | 0.82 | 284 | 0.82 | |||||||||||||||||||||||
Residential mortgage | 12 | 0.03 | 11 | 0.03 | 13 | 0.04 | 14 | 0.04 | 11 | 0.04 | |||||||||||||||||||||||
Home equity lines | 4 | 0.04 | 4 | 0.07 | (3 | ) | (0.04 | ) | 2 | 0.02 | 6 | 0.11 | |||||||||||||||||||||
Direct/Indirect consumer | 50 | 0.50 | 48 | 0.56 | 48 | 0.57 | 39 | 0.47 | 38 | 0.47 | |||||||||||||||||||||||
Consumer finance(1) | 32 | 1.59 | 48 | 2.60 | 55 | 2.80 | 46 | 2.18 | 47 | 2.04 | |||||||||||||||||||||||
Credit card | 585 | 5.45 | 443 | 5.05 | 423 | 5.12 | 390 | 5.32 | 378 | 5.78 | |||||||||||||||||||||||
Other consumer - domestic | 10 | n/m | 9 | n/m | 11 | n/m | 11 | n/m | 8 | n/m | |||||||||||||||||||||||
Total consumer | 693 | 0.92 | 563 | 0.93 | 547 | 0.91 | 502 | 0.89 | 488 | 0.93 | |||||||||||||||||||||||
Total net charge-offs | $ | 829 | 0.67 | $ | 720 | 0.77 | $ | 725 | 0.77 | $ | 776 | 0.86 | $ | 772 | 0.88 | ||||||||||||||||||
By Business Segment: | |||||||||||||||||||||||||||||||||
Consumer & small business banking | $ | 632 | 1.71 | $ | 499 | 2.05 | % | $ | 485 | 2.02 | % | $ | 453 | 1.94 | % | $ | 432 | 1.90 | % | ||||||||||||||
Wealth & investment management | (4 | ) | (0.04 | ) | 6 | 0.06 | (1 | ) | (0.01 | ) | 5 | 0.06 | 6 | 0.06 | |||||||||||||||||||
Commercial banking | 24 | 0.07 | 62 | 0.26 | 75 | 0.31 | 123 | 0.52 | 98 | 0.42 | |||||||||||||||||||||||
Global corporate & investment banking | 70 | 0.58 | 89 | 0.96 | 50 | 0.50 | 96 | 0.90 | 121 | 1.00 | |||||||||||||||||||||||
Corporate other | 107 | 0.38 | 64 | 0.25 | 116 | 0.44 | 99 | 0.43 | 115 | 0.58 | |||||||||||||||||||||||
Total net charge-offs | $ | 829 | 0.67 | $ | 720 | 0.77 | $ | 725 | 0.77 | $ | 776 | 0.86 | $ | 772 | 0.88 | ||||||||||||||||||
Loans are classified as domestic or foreign based upon the domicile of the borrower.
n/m = not meaningful
(1) | Includes lease financing of $5, $10, $10, $12, and $14 for the quarters ended June 30, 2004, March 31, 2004, December 31, 2003, September 30, 2003, and June 30, 2003, respectively. |
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
22
Bank of America Corporation
Selected Emerging Markets(1)
(Dollars in billions) | Loans and Loan Commitments | Other Financing (2) | Derivative Assets | Debt Securities/ Other Investments (3,4) | Total Cross- border Exposure (5) | Local Country Exposure Net of Local Liabilities (6) | Total Foreign Exposure June 30, 2004 | Increase/ (Decrease) from December 31, 2003 | |||||||||||||||||
Region/Country | |||||||||||||||||||||||||
Asia | |||||||||||||||||||||||||
Hong Kong(7) | $ | 0.2 | $ | 0.0 | $ | 0.1 | $ | 0.1 | $ | 0.4 | $ | 0.5 | $ | 0.9 | $ | 0.0 | |||||||||
India | 0.6 | 0.1 | 0.2 | 0.3 | 1.2 | 0.6 | 1.8 | 0.2 | |||||||||||||||||
Singapore | 0.2 | 0.1 | 0.1 | 0.1 | 0.5 | 0.0 | 0.5 | (0.1 | ) | ||||||||||||||||
South Korea | 0.3 | 0.8 | 0.0 | 0.2 | 1.3 | 0.2 | 1.5 | (0.1 | ) | ||||||||||||||||
Taiwan | 0.3 | 0.5 | 0.1 | 0.0 | 0.9 | 0.0 | 0.9 | 0.4 | |||||||||||||||||
Other Asia(8) | 0.2 | 0.1 | 0.0 | 0.4 | 0.7 | 0.3 | 1.0 | 0.1 | |||||||||||||||||
Total | 1.8 | 1.6 | 0.5 | 1.1 | 5.0 | 1.6 | 6.6 | 0.5 | |||||||||||||||||
Central and Eastern Europe (8) | 0.0 | 0.0 | 0.0 | 0.2 | 0.2 | 0.0 | 0.2 | (0.1 | ) | ||||||||||||||||
Latin America | |||||||||||||||||||||||||
Argentina(9) | 0.4 | 0.1 | 0.0 | 0.1 | 0.6 | 0.0 | 0.6 | 0.3 | |||||||||||||||||
Brazil(9) | 1.4 | 0.3 | 0.0 | 0.1 | 1.8 | 1.7 | 3.5 | 2.8 | |||||||||||||||||
Chile | 0.3 | 0.1 | 0.0 | 0.0 | 0.4 | 0.7 | 1.1 | 1.0 | |||||||||||||||||
Mexico(10) | 0.7 | 0.2 | 0.1 | 2.1 | 3.1 | 0.1 | 3.2 | 0.4 | |||||||||||||||||
Other Latin America (8) | 0.4 | 0.2 | 0.1 | 0.2 | 0.9 | 0.3 | 1.2 | 0.5 | |||||||||||||||||
Total | 3.2 | 0.9 | 0.2 | 2.5 | 6.8 | 2.8 | 9.6 | 5.0 | |||||||||||||||||
Total | $ | 5.0 | $ | 2.5 | $ | 0.7 | $ | 3.8 | $ | 12.0 | $ | 4.4 | $ | 16.4 | $ | 5.4 | |||||||||
(1) | There is no generally accepted definition of emerging markets. The definition that we use includes all countries in Asia excluding Japan, Australia and New Zealand; all countries in Latin America excluding Cayman Islands and Bermuda; and all countries in Central and Eastern Europe excluding Greece. |
(2) | Includes acceptances, standby letters of credit, commercial letters of credit and formal guarantees. |
(3) | Amounts outstanding for Other Asia and Other Latin America have been reduced by $13 million and $178 million, respectively, at June 30, 2004 and $13 million and $173 million, respectively, at December 31, 2003. Such amounts represent the fair value of U.S. Treasury securities held as collateral outside the country of exposure. |
(4) | Cross-border resale agreements are presented based on the domicile of the counterparty because the counterparty has the legal obligation for repayment. For regulatory reporting under in which the claim is denominated, consistent with FFIEC reporting rules. reporting under Federal Financial Institutions Examinations Council (FFIEC) guidelines, cross-border resale agreements are presented based on the domicile of the issuer of the securities that are held as collateral. |
(5) | Cross-border exposure includes amounts payable to the Corporation by borrowers with a country of residence other than the one in which the credit is booked, regardless of the currency in which the claim is denominated, consistent with FFIEC reporting rules. |
(6) | Local country exposure includes amounts payable to the Corporation by borrowers with a country of residence in which the credit is booked, regardless of the currency in which the claim is denominated. Management nets local funding or liabilities against local exposures as allowed by the FFIEC. Total amount of local country exposure funded by local liabilities at June 30, 2004 in Latin America and Asia was $7.9 billion and $5.5 billion, respectively, of which $3.6 billion was in Brazil, $1.4 billion in Argentina, $1.0 billion in Chile, $3.2 billion in Hong Kong and $1.0 billion in Singapore. There were no other counties with local country exposure funded by local liabilities greater than $1.0 billion. |
(7) | Local country exposure net of local liabilities to Hong Kong consisted of $0.5 billion of commercial exposure at June 30, 2004 compared to $0.6 billion of commercial exposure at December 31, 2003. The commercial exposure was primarily to local clients and was diversified across many industries. |
(8) | Other Asia, Central and Eastern Europe and Other Latin America include countries with total foreign exposure of less than $0.5 billion. |
(9) | The Corporation has certain risk mitigation instruments associated with Brazil and Argentina exposure, including insurance contracts, other trade-related transfer risk mitigation and third party funding. Ability to file a claim under insurance policies may vary with the country's current political and economic environment. |
Risk Mitigation | Argentina | Brazil | ||||
Total foreign exposure, June 30, 2004 | $ | 0.6 | $ | 3.5 | ||
Less: Insurance contracts | 0.2 | 0.5 | ||||
Other trade-related transfer risk mitigation | — | 1.0 | ||||
Third party funding | — | 0.2 | ||||
Total foreign exposure net of mitigation, June 30, 2004 | $ | 0.4 | $ | 1.8 | ||
(10) | Includes $1.8 billion related to Grupo Financiero Santander Serfin acquired in the first quarter of 2003. |
Current period information includes the FleetBoston acquisition; prior periods have not been restated.
23