EXHIBIT 99.1 October 16, 2000 Contact: Investors Susan Carr (704-386-8059) or Kevin Stitt (704-386-5667) Media Bob Stickler or Sharon Tucker (704-386-8465) Bank of America Reports 3rd Quarter Operating Earnings of $1.31 Per Share CHARLOTTE, N.C., October 16, 2000 - Bank of America Corporation today reported that third quarter operating earnings rose 7 percent to $1.31 per share (diluted) from $1.23 per share a year ago. Operating earnings of $2.18 billion included a $257 million pre-tax reduction in income related to the deterioration of auto lease residual values. Including that reduction, operating earnings were still up from net income of $2.15 billion a year earlier. Third quarter results also contained a $346 million after-tax charge primarily to cover severance costs related to growth initiatives announced July 28. After that charge, net income in the latest quarter was $1.83 billion, equal to $1.10 per share. The return on common equity in the latest quarter was 18.2 percent while the return on assets was 1.26 percent. Cash-basis operating earnings - which exclude the amortization of intangibles - were $2.39 billion, or $1.44 per share, in the latest quarter. The return on average tangible common shareholders' equity was 27.8 percent. more Page 2 For the first nine months of 2000, Bank of America operating earnings totaled $6.48 billion, up 6 percent from $6.13 billion a year ago. Operating earnings per share rose 12 percent to $3.87 from $3.45. Net income was $6.13 billion, or $3.66 per share, up from $5.98 billion, or $3.37 per share, a year earlier. "Bank of America in the third quarter faced the same head wind of higher interest rates and a slowing economy as other banks," said Hugh L. McColl Jr., chairman and chief executive officer. "Despite those factors, we recorded real progress in building our targeted growth businesses, which was reflected in better core revenue growth. "Our money management business continues to grow rapidly. We are gaining recognition as the leading bank in e-space, and our card business continues to expand at a double-digit pace. In addition, our investment banking team was recently recognized by a major international consultant as having made the most progress during the past 12 months of any financial company in the history of its annual survey," he continued. "Our entire team is focused on creating and growing lasting customer relationships to increase revenue and build shareholder value. Momentum has been building steadily during 2000, laying a strong foundation for 2001," he said. Third Quarter Strategic Highlights o All five card services businesses (consumer, commercial, government, debit and merchant processing) had double digit increases in both volume and in new accounts compared to last year. o Assets under management rose to $275 billion, up $47 billion, or 21 percent, from the prior year and up $14 billion from the second quarter of 2000. The Nations Funds family of funds reached $100 billion in mutual fund assets, driven by increases in equity, fixed income and money market funds. o The bank launched prototype offices in Atlanta in October as the start of a redesign of the company's 4,500 banking centers. Accelerated by the needs of customers who use online services, the redesigned banking centers follow three models. Financial centers will offer greater access to financial experts, enabling customers to get their banking, mortgage and financial planning advice in one place. Traditional banking centers will add more capabilities, including mortgage loan officers and new technology. Transaction centers will accommodate customers who want to make limited transactions through tellers and ATMs. more Page 3 o The company announced an intent to form an alliance with Exult, Inc., a provider of Web-enabled integrated services designed to manage the human resources function for large multinational corporations. The alliance is expected to reduce by 10 percent the cost of delivering key administrative staff functions to the bank and to provide Bank of America with new revenue through the delivery of financial products to other Exult clients. o The Bank of America Business Center was launched. It is an integrated, online destination for small business customers, providing access to online tools, information, financial products and services and marketplace procurement for business-to-business commerce. It enables small business owners and managers to streamline and automate many of their back-office operations, saving both time and money. After only one month, 1,300 clients had registered to use these capabilities. Third Quarter Financial Highlights (compared to a year ago) Earnings momentum in consumer and small-business areas increased due to targeted growth initiatives: o Total card fee revenue grew 7 percent to $594 million as a result of a successful promotional campaign. o Investment and brokerage income rose 13 percent to $471 million as a result of new asset management business and productivity increases in consumer brokerage. o Average managed consumer loans and leases grew 17 percent, led by growth in residential mortgage, home equity lines and card services. Corporate banking continued its strong performance: o Trading account profits increased 19 percent to $372 million, with growth in equity-related trading activity. o Investment banking income rose 4 percent to $376 million due to growth in the underwriting and advisory businesses. more Page 4 Other highlights: o Equity investment gains were up 24 percent to $422 million, including venture capital gains of $224 million and strategic investment gains of $153 million. o Lower personnel costs and professional fees helped drive down total noninterest expense by 3 percent. o Net charge-offs decreased to an annualized .43 percent of loans and leases - an improvement of 8 basis points. Revenue Revenue rose 3 percent over the previous year, excluding the impact of lease residuals. Fully taxable-equivalent net interest income increased 2 percent to $4.67 billion, including a $71 million charge related to auto lease residuals. o The increase reflected 13 percent average managed loan growth plus higher levels of core deposits and equity. These factors were partially offset by the impact of loan sales and securitizations in 1999, margin compression, auto lease residuals and the cost of share repurchases. These factors also contributed to the decline in the net interest yield of 34 basis points to 3.12 percent. o Average managed loans and leases rose 13 percent to $428 billion. o Average core deposits grew by 3 percent, or $10 billion, to $301 billion. Noninterest income declined 3 percent to $3.65 billion, including a charge of $186 million related to auto lease residuals. Absent that charge, noninterest income was up 3 percent. o Equity investments, service charges, card services, trading, investment banking and asset management had year-over-year increases. o The absence of loan sales and securitizations, which boosted the year-ago results, and the impact of the auto lease residuals in the current quarter were the primary factors in reducing other income to $93 million from $408 million. more Page 5 Efficiency Noninterest expense declined 3 percent to $4.41 billion, reflecting lower personnel, equipment and professional fee costs. The cash-basis efficiency ratio declined to 50 percent. Credit Quality The provision for credit losses in the third quarter was $435 million, down from $450 million a year earlier. Net charge-offs were $435 million, down from $460 million a year ago, driven primarily by lower losses on loans to consumers. Net charge-offs were equal to an annualized .43 percent of loans and leases, down from .51 percent 12 months earlier. Nonperforming assets were $4.40 billion, or 1.09 percent of loans, leases and foreclosed properties at September 30, 2000, compared to $3.04 billion, or .84 percent a year earlier. The increase mostly reflects a rise in nonperforming loans in the corporate portfolio centered in specific industries. Nonperforming loans also increased in real estate-secured consumer finance loans, reflecting the growth and maturing of that portfolio. The allowance for credit losses totaled $6.7 billion at September 30, 2000, equal to 1.67 percent of loans and leases. Capital Strength Total shareholders' equity was $46.9 billion at September 30, 2000, up 2 percent from 12 months earlier. This represented 6.98 percent of period-end assets of $672 billion. The Tier 1 Capital Ratio was 7.32 percent. During the quarter, the company repurchased 15.8 million shares. Since June 1999, 128 million shares have been repurchased, representing an investment in Bank of America stock of $7.3 billion. Average (diluted) common shares outstanding were 1.661 billion in the third quarter, down 5 percent from 1.755 billion a year earlier. Business Segment Results (year to date) Consumer and Commercial Banking, which serves individuals and businesses with annual sales of up to $500 million, earned $3.47 billion and had a return on equity of 19.2 percent. This segment represented 54 percent of the company's operating earnings. more Page 6 Asset Management, which encompasses the private bank, trust, investment management, mutual funds and retail brokerage, earned $472 million, representing 7 percent of operating earnings. The return on equity was 35.8 percent. Global Corporate and Investment Banking, which serves large corporate, institutional and government customers, earned $1.89 billion, representing 29 percent of the company's earnings. The return on equity was 18.3 percent. Equity Investments earned $533 million, representing 8 percent of the company's earnings. The return on equity was 39.5 percent. Bank of America is the largest bank in the United States. It has full-service operations in 21 states and the District of Columbia and provides financial products and services to 30 million households and two million businesses, as well as providing international corporate financial services for business transactions in 190 countries. The company's stock (ticker: BAC) is listed on the New York, Pacific and London stock exchanges and certain shares are listed on the Tokyo Stock Exchange. NOTE: James H. Hance Jr., vice chairman and chief financial officer, will discuss the quarter in a conference call at 9:30 a.m. (EDT) today. The call can be accessed through a webcast available on the Bank of America website. www.bankofamerica.com Forward Looking Statements This press release contains forward-looking statements with respect to the financial conditions and results of operations of Bank of America, including, without limitation, statements relating to the earnings outlook of the company. These forward-looking statements involve certain risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) projected business increases following process changes and other investments are lower than expected; (2) competitive pressure among financial services companies increases significantly; (3) costs or difficulties related to the integration of acquisitions are greater than expected; (4) general economic conditions, internationally, nationally or in the states in which the company does business, are less favorable than expected; (5) changes in the interest rate environment reduce interest margins and affect funding sources; (6) changes in market rates and prices may adversely affect the value of financial products; and (7) legislation or regulatory requirements or changes adversely affect the businesses in which the company is engaged. Bank of America Corporation Three Months Nine Months Ended September 30 Ended September 30 ------------------------------- ------------------------------- Financial Summary 2000 1999 2000 1999 -------------- -------------- --------------- ------------- (In millions, except per share data) Operating net income $ 2,175 $ 2,151 $ 6,478 $ 6,125 Operating earnings per common share 1.33 1.25 3.91 3.53 Diluted operating earnings per common share 1.31 1.23 3.87 3.45 Cash basis earnings (1) 2,390 2,373 7,128 6,794 Cash basis earnings per common share 1.46 1.38 4.31 3.91 Cash basis diluted earnings per common share 1.44 1.35 4.26 3.83 Dividends per common share .50 .45 1.50 1.35 Closing market price per common share 52.38 55.69 52.38 55.69 Average common shares issued and outstanding 1,639.392 1,722.307 1,654.013 1,734.401 Average diluted common shares issued and outstanding 1,661.031 1,755.146 1,674.748 1,773.692 Summary Income Statement (Operating Basis) (Taxable-equivalent basis in millions) Net interest income $ 4,672 $ 4,603 $ 13,976 $ 13,911 Provision for credit losses (435) (450) (1,325) (1,470) Gains on sales of securities 11 44 23 226 Noninterest income 3,645 3,728 11,191 10,473 Other noninterest expense (4,410) (4,526) (13,446) (13,436) -------------- -------------- --------------- ------------- Income before income taxes 3,483 3,399 10,419 9,704 Income taxes - including FTE adjustment 1,308 1,248 3,941 3,579 -------------- -------------- --------------- ------------- Operating net income $ 2,175 $ 2,151 $ 6,478 $ 6,125 ============== ============== =============== ============= Summary Balance Sheet (Average balances in billions) Loans and leases $402.763 $ 361.400 $ 390.296 $ 362.302 Managed loans and leases (2) 427.645 378.753 417.396 376.299 Securities 83.728 80.261 85.792 77.998 Earning assets 597.248 528.564 581.029 527.450 Total assets 685.017 611.448 669.598 612.152 Deposits 356.734 336.998 351.863 341.693 Shareholders' equity 47.735 46.439 46.962 46.537 Common shareholders' equity 47.660 46.360 46.886 46.464 Performance Indices (Operating Basis) Return on average common shareholders' equity 18.15 % 18.40 % 18.45 % 17.61 % Return on average tangible common shareholders' equity 27.81 29.48 28.68 28.48 Return on average assets 1.26 1.40 1.29 1.34 Return on average tangible assets 1.42 1.58 1.45 1.52 Net interest yield 3.12 3.46 3.21 3.52 Efficiency ratio 53.01 54.34 53.42 55.10 Cash basis efficiency ratio 50.43 51.67 50.84 52.36 Shareholder Value Added (SVA) $ 953 $ 971 $ 2,916 $ 2,624 Net charge-offs (in millions) 435 460 1,325 1,499 % of average loans and leases .43 % .51 % .45 % .55 % Managed bankcard net charge-offs as a % of average managed bankcard receivables 4.15 4.83 4.79 5.64 Reported Results (Including Merger-Related Charges) (In millions, except per share data) Net income $ 1,829 $ 2,151 $ 6,132 $ 5,980 Earnings per common share 1.11 1.25 3.70 3.45 Diluted earnings per common share 1.10 1.23 3.66 3.37 Return on average common shareholders' equity 15.25 % 18.40 % 17.46 % 17.19 % (1) Cash basis earnings equal operating net income excluding amortization of intangibles. (2) Prior periods have been restated for comparison (e.g. acquisitions, divestitures and securitizations). Bank of America Corporation - Continued Balance Sheet Highlights September 30 ----------------------------------- (In billions, except per share data) 2000 1999 ----------------------------------- Loans and leases $402.592 $ 360.236 Securities 81.103 79.836 Earning assets 584.352 534.431 Total assets 671.725 620.652 Deposits 353.988 337.011 Shareholders' equity 46.859 45.889 Common shareholders' equity 46.785 45.811 Per share 28.69 26.79 Total equity to assets ratio (period end) 6.98 % 7.39 % Risk-based capital ratios: Tier 1 7.32 7.71 Total 10.80 11.39 Leverage ratio (supervisory mode) 6.06 6.59 Period-end common shares issued and outstanding (in millions) 1,630.824 1,710.039 Allowance for credit losses $ 6.739 $ 7.076 Allowance for credit losses as a % of loans and leases 1.67 % 1.96 % Allowance for credit losses as a % of nonperforming loans 161.32 251.85 Nonperforming loans $ 4.177 $ 2.810 Nonperforming assets 4.403 3.038 Nonperforming assets as a % of: Total assets .65 % .49 % Loans, leases and foreclosed properties 1.09 .84 Other Data Full-time equivalent employees 146,346 158,886 Number of banking centers 4,419 4,535 Number of ATM's 13,878 14,042 BUSINESS SEGMENT RESULTS - Three Months Ended September 30, 2000 (in millions) Operating Avg Loans Return on Total Revenue Net Income and Leases Equity -------------- -------------- --------------- ------------- Consumer and Commercial Banking $ 5,142 $ 1,180 $ 265,267 19.4 % Asset Management Group 555 154 22,634 34.5 Global Corporate and Investment Banking 2,189 592 114,580 16.5 Equity Investments 346 196 450 39.7 Other 85 53 n/m n/m n/m = not meaningful Bank of America Consolidated Financial Highlights (Excludes Merger-Related Charges) - ------------------------------------------------------------------------------------------------------------------------------------ (Dollars in millions, except per share information; Shares in millions) Third Second First Fourth Third Quarter Quarter Quarter Quarter Quarter 2000 2000 2000 1999 1999 ---------------------------------------------------------------------------- Operating net income $ 2,175 $ 2,063 $ 2,240 $ 2,115 $ 2,151 Cash basis earnings 2,390 2,281 2,457 2,334 2,373 Operating earnings per common share 1.33 1.25 1.34 1.24 1.25 Diluted operating earnings per common share 1.31 1.23 1.33 1.23 1.23 Cash basis earnings per common share 1.46 1.38 1.47 1.37 1.38 Cash basis diluted earnings per common share 1.44 1.36 1.46 1.35 1.35 Dividends per common share 0.50 0.50 0.50 0.50 0.45 Average common shares issued and outstanding 1,639.392 1,653.495 1,669.311 1,701.092 1,722.307 Average diluted common shares issued and outstanding 1,661.031 1,676.089 1,688.318 1,725.187 1,755.146 Period-end common shares issued and outstanding 1,630.824 1,645.701 1,657.754 1,677.273 1,710.039 Period-end managed loans and leases* $ 425,820 $ 424,124 $ 406,393 $ 396,704 $ 380,556 Average managed loans and leases* 427,645 416,798 403,723 390,336 378,753 *Prior periods have been restated for comparison (e.g. acquisitions, divestitures and securitizations) Performance ratios (Operating basis): Return on average assets 1.26 % 1.23 % 1.38 % 1.33 % 1.40 % Return on average tangible assets 1.42 1.39 1.55 1.50 1.58 Return on average common shareholders' equity 18.15 17.63 19.59 17.95 18.40 Return on average tangible common shareholders' equity 27.81 27.51 30.83 28.38 29.48 Efficiency ratio 53.01 53.77 53.49 55.91 54.34 Cash basis efficiency ratio 50.43 51.12 50.98 53.22 51.67 Net interest yield 3.12 3.24 3.27 3.32 3.46 Shareholder Value Added (SVA) $ 953 $ 878 $ 1,086 $ 921 $ 971 Book value per common share 28.69 27.82 27.28 26.44 26.79 Market price per share of common stock: High for the period 57.6250 61.0000 55.1875 67.5000 76.3750 Low for the period 43.6250 42.9844 42.3125 47.6250 53.2500 Closing price 52.3750 43.0000 52.4375 50.1875 55.6875 Other data: Number of banking centers 4,419 4,450 4,502 4,524 4,535 Number of ATM's 13,878 13,944 13,954 14,019 14,042 Full-time equivalent employees 146,346 150,854 152,948 155,906 158,886 (1) Cash basis earnings equals net income excluding amortization of intangibles. Bank of America Corporation Consolidated Statement of Income - ---------------------------------------------------------------------------------------------------------------------------------- (Dollars in millions, except per share information) Third Second First Fourth Third Quarter Quarter Quarter Quarter Quarter 2000 2000 2000 1999 1999 -------------------------------------------------------- Interest income Interest and fees on loan and leases $ 8,305 $ 7,923 $ 7,394 $ 7,063 $ 6,883 Interest and dividends on securities 1,259 1,271 1,331 1,300 1,208 Federal funds sold and securities purchased under agreements to resell 633 595 575 458 440 Trading account assets 744 694 536 535 482 Other interest income 324 254 250 266 281 -------------------------------------------------------- Total interest income 11,265 10,737 10,086 9,622 9,294 -------------------------------------------------------- Interest expense Deposits 2,868 2,720 2,495 2,324 2,198 Short-term borrowings 2,223 1,990 1,802 1,638 1,437 Trading account liabilities 237 189 181 190 189 Long-term debt 1,344 1,207 1,084 995 920 -------------------------------------------------------- Total interest expense 6,672 6,106 5,562 5,147 4,744 -------------------------------------------------------- Net interest income 4,593 4,631 4,524 4,475 4,550 Provision for credit losses 435 470 420 350 450 -------------------------------------------------------- Net interest income after provision 4,158 4,161 4,104 4,125 4,100 Gains on sales of securities 11 6 6 14 44 Noninterest income Consumer service charges 684 646 618 669 644 Corporate service charges 489 479 489 477 480 -------------------------------------------------------- Total service charges 1,173 1,125 1,107 1,146 1,124 -------------------------------------------------------- Consumer investment and brokerage services 357 387 364 334 355 Corporate investment and brokerage services 114 105 121 103 63 -------------------------------------------------------- Total investment and brokerage services 471 492 485 437 418 -------------------------------------------------------- Mortgage servicing income 144 136 128 210 206 Investment banking income 376 373 397 394 363 Equity investment gains 422 134 563 205 339 Card income 594 556 484 558 557 Trading account profits 372 471 724 287 313 Other income 93 213 158 359 408 -------------------------------------------------------- Total noninterest income 3,645 3,500 4,046 3,596 3,728 -------------------------------------------------------- Other noninterest expense Personnel 2,298 2,311 2,534 2,378 2,336 Occupancy 419 411 418 419 417 Equipment 285 296 301 336 313 Marketing 147 132 119 98 145 Professional fees 100 93 105 178 160 Amortization of intangibles 215 218 217 219 222 Data processing 167 169 159 195 164 Telecommunications 127 133 131 142 131 Other general operating 509 505 515 456 498 General administrative 143 145 124 129 140 -------------------------------------------------------- Total other noninterest expense 4,410 4,413 4,623 4,550 4,526 -------------------------------------------------------- Operating income before income taxes 3,404 3,254 3,533 3,185 3,346 Income tax expense 1,229 1,191 1,293 1,070 1,195 -------------------------------------------------------- Operating net income $ 2,175 $ 2,063 $ 2,240 $ 2,115 $ 2,151 -------------------------------------------------------- Operating income available to common shareholders $ 2,174 $ 2,061 $ 2,239 $ 2,114 $ 2,149 -------------------------------------------------------- Per share information Operating earnings per common share $1.33 $1.25 $1.34 $1.24 $1.25 -------------------------------------------------------- Diluted operating earnings per common share $1.31 $1.23 $1.33 $1.23 $1.23 -------------------------------------------------------- Dividends per common share $ .50 $ .50 $ .50 $ .50 $ .45 -------------------------------------------------------- Average common shares issued and outstanding (in thousands) 1,639,392 1,653,495 1,669,311 1,701,092 1,722,307 -------------------------------------------------------- Average diluted common shares issued and outstanding (in thousands) 1,661,031 1,676,089 1,688,318 1,725,187 1,755,146 -------------------------------------------------------- As reported (includes merger-related charges, net of tax) Net income $ 1,829 $ 2,063 $ 2,240 $ 1,902 $ 2,151 Net income available to common shareholders 1,828 2,061 2,239 1,901 2,149 Earnings per common share 1.11 1.25 1.34 1.12 1.25 Diluted earnings per common share 1.10 1.23 1.33 1.10 1.23 Certain prior period amounts have been reclassified to conform to current period classifications. Bank of America Corporation Consolidated Balance Sheet - ----------------------------------------------------------------------------------------------------------------------- September 30 June 30 September 30 (Dollars in Millions) 2000 2000 1999 - ----------------------------------------------------------------------------------------------------------------------- Assets Cash and cash equivalents $ 24,395 $ 27,493 $ 25,414 Time deposits placed and other short-term investments 5,467 4,394 4,846 Federal funds sold and securities purchased under agreements to resell 33,408 42,460 40,369 Trading account assets 47,198 50,162 38,651 Derivative-dealer assets 15,398 16,149 18,103 Securities: Available-for-sale 79,747 79,518 78,353 Held-to-maturity 1,356 1,439 1,483 - ----------------------------------------------------------------------------------------------------------------------- Total securities 81,103 80,957 79,836 - ----------------------------------------------------------------------------------------------------------------------- Loans and leases 402,592 400,817 360,236 Allowance for credit losses (6,739) (6,815) (7,076) - ----------------------------------------------------------------------------------------------------------------------- Loans and leases, net of allowance for credit losses 395,853 394,002 353,160 - ----------------------------------------------------------------------------------------------------------------------- Premises and equipment, net 6,450 6,514 6,728 Customers' acceptance liability 2,277 2,477 2,066 Interest receivable 4,620 4,083 3,838 Mortgage servicing rights 4,029 4,065 3,845 Goodwill 11,803 11,961 12,414 Core deposit and other intangibles 1,554 1,617 1,800 Other assets 38,170 33,204 29,582 - ----------------------------------------------------------------------------------------------------------------------- Total Assets $ 671,725 $ 679,538 $ 620,652 - ----------------------------------------------------------------------------------------------------------------------- Liabilities Deposits in domestic offices: Noninterest-bearing $ 92,050 $ 94,014 $ 87,292 Interest-bearing 207,801 207,977 202,037 Deposits in foreign offices: Noninterest-bearing 1,515 1,631 1,981 Interest-bearing 52,622 53,042 45,701 - ----------------------------------------------------------------------------------------------------------------------- Total deposits 353,988 356,664 337,011 - ----------------------------------------------------------------------------------------------------------------------- Federal funds sold and securities purchased under agreements to repurchase 72,896 89,508 79,739 Trading account liabilities 25,354 23,056 18,239 Derivative-dealer liabilities 18,877 17,609 18,689 Commercial paper 10,330 10,225 7,826 Other short-term borrowings 45,271 39,801 32,893 Acceptances outstanding 2,277 2,477 2,066 Accrued expenses and other liabilites 21,506 20,137 18,993 Long-term debt 69,412 69,245 54,352 Trust preferred securities 4,955 4,955 4,955 - ----------------------------------------------------------------------------------------------------------------------- Total liabilities 624,866 633,677 574,763 - ----------------------------------------------------------------------------------------------------------------------- Shareholders' equity Preferred stock, $0.01 par value; authorized - 100,000,000 shares; issued and outstanding 1,732,349; 1,742,349 and 1,828,702 shares 74 75 78 Common stock, $0.01 par value; authorized - 5,000,000,000 shares; issued and outstanding 1,630,823,577; 1,645,701,425 and 1,710,039,286 shares 9,397 10,188 13,538 Retained earnings 39,338 38,330 34,631 Accumulated other comprehensive losses (1,808) (2,537) (1,929) Other (142) (195) (429) - ----------------------------------------------------------------------------------------------------------------------- Total shareholders' equity 46,859 45,861 45,889 - ----------------------------------------------------------------------------------------------------------------------- Total liabilities and shareholders' equity $ 671,725 $ 679,538 $ 620,652 - ----------------------------------------------------------------------------------------------------------------------- Bank of America Corporation Quarterly Taxable-Equivalent Data - ------------------------------------------------------------------------------------------------------------------------ (Dollars in Millions) Third Quarter 2000 Second Quarter 2000 ----------------------------------------------------------- Interest Interest Average Income/ Yield/ Average Income/ Yield/ Balance Expense Rate Balance Expense Rate ----------------------------------------------------------- Earning assets: Time deposits placed and other short-term investments $ 4,700 $ 83 6.97 % $ 4,578 $ 79 7.02 % Federal funds sold and securities purchased under agreements to resell 40,763 633 6.20 43,983 595 5.43 Trading account assets 53,793 749 5.55 48,874 702 5.77 Securities: Available for sale (1) 82,333 1,254 6.08 84,054 1,270 6.05 Held to maturity 1,395 30 8.59 1,406 27 7.68 ----------------------------------------------------------- Total securities 83,728 1,284 6.12 85,460 1,297 6.08 ----------------------------------------------------------- Loans and leases (2): Commercial - domestic 151,903 3,173 8.31 148,034 3,023 8.21 Commercial - foreign 29,845 555 7.39 29,068 515 7.12 Commercial real estate - domestic 26,113 597 9.09 25,497 563 8.88 Commercial real estate - foreign 235 5 8.30 376 8 9.15 ----------------------------------------------------------- Total commercial 208,096 4,330 8.28 202,975 4,109 8.14 ----------------------------------------------------------- Residential mortgage 94,380 1,759 7.45 91,825 1,696 7.40 Home equity lines 20,185 466 9.18 19,067 422 8.91 Direct/Indirect consumer 41,905 848 8.06 41,757 867 8.36 Consumer finance 25,049 559 8.93 24,123 545 9.03 Bankcard 10,958 344 12.49 9,429 279 11.87 Foreign consumer 2,190 48 8.79 2,228 48 8.81 ----------------------------------------------------------- Total consumer 194,667 4,024 8.25 188,429 3,857 8.21 ----------------------------------------------------------- Total loans and leases 402,763 8,354 8.26 391,404 7,966 8.17 ----------------------------------------------------------- Other earning assets 11,501 241 8.39 8,191 176 8.53 ----------------------------------------------------------- Total earning assets (3) 597,248 11,344 7.57 582,490 10,815 7.45 ----------------------------------------------------------- Cash and cash equivalents 24,191 25,605 Other assets, less allowance for credit losses 63,578 64,493 ----------------------------------------------------------- Total assets $685,017 $672,588 ----------------------------------------------------------- Interest-bearing liabilities: Domestic interest-bearing deposits: Savings $23,195 78 1.33 $23,936 78 1.32 NOW and money market deposit accounts 99,710 740 2.96 100,186 734 2.94 Consumer CDs and IRAs 77,864 1,083 5.53 77,384 1,034 5.38 Negotiated CDs, public funds and other time deposits 8,598 140 6.46 7,361 111 6.09 ------------------------------------------------------------ Total domestic interest-bearing deposits 209,367 2,041 3.88 208,867 1,957 3.77 ------------------------------------------------------------ Foreign interest-bearing deposits (4): Banks located in foreign countries 18,845 286 6.03 15,823 232 5.92 Governments and official institutions 11,182 177 6.30 9,885 151 6.12 Time, savings, and other 25,972 364 5.58 27,697 380 5.51 ------------------------------------------------------------ Total foreign interest-bearing deposits 55,999 827 5.87 53,405 763 5.74 ------------------------------------------------------------ Total interest-bearing deposits 265,366 2,868 4.30 262,272 2,720 4.17 ------------------------------------------------------------ Federal funds purchased, securities sold under agreements to repurchase and other short-term borrowings 136,007 2,223 6.51 135,817 1,990 5.89 Trading account liabilities 24,233 237 3.88 20,532 189 3.70 Long-term debt (5) 74,022 1,344 7.26 69,779 1,207 6.92 ------------------------------------------------------------ Total interest-bearing liabilities (6) 499,628 6,672 5.32 488,400 6,106 5.02 ------------------------------------------------------------ Noninterest-bearing sources: Noninterest-bearing deposits 91,368 91,154 Other liabilities 46,286 45,922 Shareholders' equity 47,735 47,112 ------------------------------------------------------------ Total liabilities and shareholders' equity $685,017 $672,588 ------------------------------------------------------------ Net interest spread 2.25 2.43 Impact of noninterest-bearing sources .87 .81 ------------------------------------------------------------ Net interest income/yield on earning assets $4,672 3.12 % $4,709 3.24 % ------------------------------------------------------------ (1) The average balance and yield on available-for-sale securities are based on the average of historical amortized cost balances. (2) Nonperforming loans are included in the average loan balances. Income on such nonperforming loans is recognized on a cash basis. (3) Interest income includes taxable-equivalent basis adjustments of $79, $78 and $71 in the third, second and first quarters of 2000 and $66 and $53 in the fourth and third quarters of 1999, respectively. Interest income also includes the impact of risk management interest rate contracts, which (decreased) increased interest income on the underlying assets $(13), $(11) and $7 in the third, second and first quarters of 2000 and $57 and $103 in the fourth and third quarters of 1999, respectively. (4) Primarily consists of time deposits in denominations of $100,000 or more. (5) Long-term debt includes trust preferred securities. (6) Interest expense includes the impact of risk management interest rate contracts, which (increased) decreased interest expense on the underlying liabilities $(16), $(5) and $(8) in the third, second and first quarters of 2000 and $(2) and $6 in the fourth and third quarters of 1999, respectively. - -------------------------------------------------------------------------------------------- First Quarter 2000 Fourth Quarter 1999 Third Quarter 1999 - -------------------------------------------------------------------------------------------- Interest Interest Interest Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/ Balance Expense Rate Balance Expense Rate Balance Expense Rate - -------------------------------------------------------------------------------------------- $ 4,504 $ 75 6.65 % $ 4,512 $ 73 6.33 % $ 5,018 $ 69 5.50 % 45,459 575 5.07 39,700 458 4.60 33,074 440 5.30 39,733 542 5.47 38,453 544 5.63 37,453 483 5.14 86,878 1,332 6.15 85,009 1,301 6.10 78,779 1,208 6.12 1,333 24 7.19 1,433 25 7.25 1,482 26 7.02 - --------------------------------------------------------------------------------------------- 88,211 1,356 6.16 86,442 1,326 6.12 80,261 1,234 6.13 - --------------------------------------------------------------------------------------------- 145,362 2,824 7.81 140,674 2,707 7.64 136,149 2,488 7.25 27,927 486 6.99 27,430 453 6.56 28,348 494 6.93 24,664 517 8.43 24,345 506 8.23 25,056 517 8.19 344 8 9.29 306 6 8.96 295 7 8.80 - --------------------------------------------------------------------------------------------- 198,297 3,835 7.78 192,755 3,672 7.56 189,848 3,506 7.33 - --------------------------------------------------------------------------------------------- 85,427 1,566 7.34 79,783 1,450 7.26 80,015 1,431 7.14 17,573 377 8.62 16,882 345 8.12 16,316 321 7.79 41,858 887 8.52 42,442 888 8.30 42,740 875 8.13 22,798 486 8.53 21,340 440 8.18 19,923 433 8.62 8,404 234 11.22 8,578 245 11.32 8,923 256 11.38 2,227 50 9.00 2,430 54 8.77 3,635 86 9.36 - --------------------------------------------------------------------------------------------- 178,287 3,600 8.10 171,455 3,422 7.94 171,552 3,402 7.89 - --------------------------------------------------------------------------------------------- 376,584 7,435 7.93 364,210 7,094 7.74 361,400 6,908 7.59 - --------------------------------------------------------------------------------------------- 8,679 174 8.11 10,247 193 7.51 11,358 213 7.40 - --------------------------------------------------------------------------------------------- 563,170 10,157 7.24 543,564 9,688 7.09 528,564 9,347 7.03 - --------------------------------------------------------------------------------------------- 25,830 25,467 25,905 62,019 61,712 56,979 - --------------------------------------------------------------------------------------------- $651,019 $630,743 $611,448 - --------------------------------------------------------------------------------------------- $24,237 78 1.29 $25,082 80 1.27 $26,037 82 1.25 98,424 679 2.78 97,481 639 2.60 96,402 579 2.38 76,074 983 5.20 74,653 932 4.95 73,429 898 4.85 6,966 103 5.93 6,825 98 5.73 6,609 94 5.66 - --------------------------------------------------------------------------------------------- 205,701 1,843 3.60 204,041 1,749 3.40 202,477 1,653 3.24 - --------------------------------------------------------------------------------------------- 14,180 188 5.33 14,305 178 4.93 13,668 160 4.65 8,745 124 5.72 7,121 99 5.53 7,185 90 4.99 26,382 340 5.17 24,993 298 4.72 25,500 295 4.57 - --------------------------------------------------------------------------------------------- 49,307 652 5.31 46,419 575 4.91 46,353 545 4.66 - --------------------------------------------------------------------------------------------- 255,008 2,495 3.93 250,460 2,324 3.68 248,830 2,198 3.50 - --------------------------------------------------------------------------------------------- 131,517 1,802 5.51 120,858 1,638 5.38 114,934 1,437 4.96 23,013 181 3.16 19,223 190 3.92 15,677 189 4.78 64,256 1,084 6.75 59,972 995 6.63 59,283 920 6.21 - --------------------------------------------------------------------------------------------- 473,794 5,562 4.72 450,513 5,147 4.54 438,724 4,744 4.30 - --------------------------------------------------------------------------------------------- 90,366 91,453 88,168 40,829 41,985 38,117 46,030 46,792 46,439 - --------------------------------------------------------------------------------------------- $651,019 $630,743 $611,448 - --------------------------------------------------------------------------------------------- 2.52 2.55 2.73 .75 .77 .73 - --------------------------------------------------------------------------------------------- $4,595 3.27 % $4,541 3.32 % $4,603 3.46 % - --------------------------------------------------------------------------------------------- Bank of America Credit Quality - Nonperforming Assets - ------------------------------------------------------------------------------------------------------------------------------------ (Dollars in Millions) Third Second First Fourth Third Quarter Quarter Quarter Quarter Quarter 2000 2000 2000 1999 1999 ------------------------------------------------------------------------------ Nonperforming Loans: Commercial - domestic $1,950 $1,535 $1,301 $1,163 $1,026 Commercial - foreign 564 588 500 486 477 Commercial real estate - domestic 136 164 208 191 174 Commercial real estate - foreign 1 2 3 3 3 Residential mortgage 502 505 483 529 542 Home equity lines 47 44 45 46 44 Direct/Indirect consumer 19 20 18 19 16 Consumer finance 951 826 737 598 519 Foreign consumer 7 7 7 7 9 ------------------------------------------------------------------------------ Total nonperforming loans 4,177 3,691 3,302 3,042 2,810 Foreclosed properties 226 195 179 163 228 ------------------------------------------------------------------------------ Total nonperforming assets $4,403 $3,886 $3,481 $3,205 $3,038 ------------------------------------------------------------------------------ Loans past due 90 days or more and not classified as nonperforming $503 $482 $461 $521 $466 Nonperforming assets as a percentage of: Total assets .65 % .57 % .53 % .51 % .49 Loans, leases and foreclosed properties 1.09 .97 .91 .86 .84 - ------------------------------------------------------------------------------------------------------------------------------------ Total Nonperforming Assets by Business Segment: Consumer and Commercial Banking $2,370 $2,176 $1,994 $1,823 $1,857 Asset Management Group 36 42 18 33 42 Global Corporate and Investment Banking 1,983 1,655 1,455 1,336 1,138 Equity Investments 12 12 12 8 - Other 2 1 2 5 1 ------------------------------------------------------------------------------ Total nonperforming assets $4,403 $3,886 $3,481 $3,205 $3,038 ------------------------------------------------------------------------------ Bank of America Credit Quality - Loan Losses - ------------------------------------------------------------------------------------------------------------------------------------ (Dollars in Millions) Third Second First Fourth Third Quarter Quarter Quarter Quarter Quarter 2000 2000 2000 1999 1999 ---------------------------------------------------------------------------------- Net charge-offs: Commercial - domestic $ 185 $ 226 $ 172 $ 191 $ 192 Commercial - foreign 23 24 5 22 9 Commercial real estate - domestic (2) 6 6 1 1 Commercial real estate - foreign - - (2) - - Residential mortgage 6 4 4 6 10 Home equity lines 2 3 3 4 1 Bankcard 79 77 81 94 93 Direct/Indirect consumer 61 61 91 110 82 Consumer finance 68 59 57 72 67 Other consumer domestic 12 10 2 - (1) Foreign consumer 1 - 1 1 6 ---------------------------------------------------------------------------------- Total $ 435 $ 470 $ 420 $ 501 $ 460 ---------------------------------------------------------------------------------- Loss ratios: Commercial - domestic .48 % .62 % .47 % .54 % .56 % Commercial - foreign .30 .33 .08 .32 .13 Commercial real estate - domestic - .09 .10 .02 .03 Commercial real estate - foreign .21 .16 - .44 .40 Residential mortgage .03 .02 .02 .03 .05 Home equity lines .04 .05 .07 .10 .01 Bankcard* 2.89 3.30 3.86 4.34 4.11 Direct/Indirect consumer .57 .58 .88 1.02 .77 Consumer finance 1.08 .97 1.01 1.33 1.35 Other consumer domestic - - - - - Foreign consumer .20 .09 .12 .25 .67 Total .43 .48 .45 .55 .51 Loss Ratios by Business Segment: Consumer and Commercial Banking .45 % .48 % .52 % .78 % .56 % Asset Management Group n/m n/m n/m .22 .71 Global Corporate and Investment Banking .48 .62 .35 .39 .32 Equity Investments n/m n/m 1.41 4.45 12.31 Allowance for credit losses ($6,739) ($6,815) ($6,827) ($6,828) ($7,076) Allowance for credit losses as a percentage of loans and leases 1.67 % 1.70 % 1.79 % 1.84 % 1.96 % - ------------------------------------------------------------------------------------------------------------------------------------ * Managed Bankcard receivable net charge-offs $ 216 $ 237 $ 257 $ 257 $ 233 ** Managed Bankcard portfolio loss ratios 4.15 % 4.84 % 5.43 % 5.29 % 4.83 % Average managed Bankcard receivables $ 20,682 $ 19,677 $ 19,051 $ 19,258 $ 19,162 n/m = not meaningful Bank of America Capital - ------------------------------------------------------------------------------------------------------------------------------------ (Dollars in Millions) Third Second First Fourth Third Quarter Quarter Quarter Quarter Quarter 2000 2000 2000 1999 1999 ---------------------------------------------------------------------------------- Beginning total shareholders' equity $45,861 $45,299 $44,432 $45,889 $45,631 Net income 1,829 2,063 2,240 1,902 2,151 Dividends (821) (825) (833) (852) (776) Common stock issued 98 117 25 154 329 Common stock repurchased (821) (712) (911) (1,954) (1,182) Change in FAS 115 adjustment-net unrealized gains (losses) 733 (47) 166 (726) (337) Change in preferred equity (1) (2) - (1) (2) Foreign currency translation adjustment and other (19) (32) 180 20 75 ---------------------------------------------------------------------------------- Ending total shareholders' equity $46,859 $45,861 $45,299 $44,432 $45,889 ---------------------------------------------------------------------------------- Preferred equity (74) (75) (77) (77) (78) ---------------------------------------------------------------------------------- Ending common equity $46,785 $45,786 $45,222 $44,355 $45,811 ---------------------------------------------------------------------------------- Fas 115 adjustment - end of period ($1,618) ($2,351) ($2,304) ($2,470) ($1,744) Total equity as a percentage of total assets 6.98 % 6.75 % 6.90 % 7.02 % 7.39 % Risk-based capital ratios: Tier 1 capital $40,696 $40,257 $39,355 $38,651 $39,380 Tier 1 capital ratio 7.32 % 7.40 % 7.42 % 7.35 % 7.71 % Total capital $60,063 $60,027 $58,376 $57,192 $58,167 Total capital ratio 10.80 % 11.03 % 11.00 % 10.88 % 11.39 % Leverage ratio 6.06 6.11 6.17 6.26 6.59 Risk-weighted assets, net $556,146 $543,987 $530,514 $525,625 $510,866 Bank of America Corporation Consumer and Commercial Banking Segment - ---------------------------------------------------------------------------------------------------------------------------- Consumer and Commercial Banking Segment Results --------------------------------------------------------------------------- Quarterly Year-to-Date --------------------------------------------------------------------------- Key Measures (in millions) 3Q00 2Q00 2000 1999 - ---------------------------------------------------------------------------------------------------------------------------- Net Income $1,180 $1,241 $3,472 $3,549 Cash Basis Earnings (1) 1,345 1,409 3,975 4,072 Total Revenue 5,142 5,186 15,326 15,724 Shareholder Value Added 617 684 1,807 1,946 Average Equity to Average Assets 7.61% 7.87% 7.83% 8.19% Return on Average Equity 19.4% 20.5% 19.2% 20.0% Return on Tangible Equity (1) 27.5% 29.0% 27.4% 29.3% Efficiency Ratio 56.3% 54.5% 56.2% 57.0% Cash Basis Efficiency Ratio (1) 53.1% 51.3% 52.9% 53.6% Selected Average Balance Sheet Components (in millions) Total Loans and Leases $265,267 $258,937 $257,379 $234,817 Total Deposits 254,980 256,416 254,813 251,246 Total Earning Assets 290,060 282,083 281,031 262,183 -------------------------------------------------------------------- Consumer and Commercial Banking Sub-Segment Results -------------------------------------------------------------------- Quarterly Year-to-Date -------------------------------------------------------------------- Key Measures (in millions) 3Q00 2Q00 2000 1999 - ---------------------------------------------------------------------------------------------------------------------------- Banking Regions Total Revenue $3,081 $2,975 $8,973 $8,875 Shareholder Value Added 497 413 1,251 1,118 Cash Basis Earnings (1) 836 755 2,275 2,175 Cash Basis Efficiency Ratio (1) 56.2% 58.3% 58.6% 61.5% Consumer Products Total Revenue $1,303 $1,484 $4,115 $4,641 Shareholder Value Added 41 189 310 534 Cash Basis Earnings (1) 302 445 1,073 1,234 Cash Basis Efficiency Ratio (1) 47.8% 39.8% 43.9% 42.1% Commercial Banking Total Revenue $758 $727 $2,238 $2,208 Shareholder Value Added 79 82 246 294 Cash Basis Earnings (1) 207 209 627 663 Cash Basis Efficiency Ratio (1) 49.5% 46.1% 47.0% 46.3% (1) Cash basis calculations exclude goodwill and other intangible assets and their related amortization expense. Bank of America Corporation Asset Management Segment ------------------------------------------------------------------- Asset Management Segment Results ------------------------------------------------------------------- Quarterly Year-to-Date ------------------------------------------------------------------- Key Measures (in millions) 3Q00 2Q00 2000 1999 - ---------------------------------------------------------------------------------------------------------------------------- Net Income $154 $163 $472 $377 Cash Basis Earnings (1) 160 169 490 396 Total Revenue 555 579 1,699 1,602 Shareholder Value Added 106 117 331 244 Average Equity to Average Assets 7.29% 7.55% 7.54% 8.47% Return on Average Equity 34.5% 37.2% 35.8% 29.8% Return on Tangible Equity (1) 39.8% 42.9% 41.3% 35.2% Efficiency Ratio 54.6% 54.4% 54.3% 57.7% Cash Basis Efficiency Ratio (1) 53.6% 53.4% 53.2% 56.5% Selected Average Balance Sheet Components (in millions) Total Loans and Leases $22,634 $21,772 $21,714 $18,360 Total Deposits 11,438 11,717 11,374 11,680 Total Earning Assets 23,615 22,765 22,639 19,123 (1) Cash basis calculations exclude goodwill and other intangible assets and their related amortization expense. Bank of America Corporation Equity Investments Segment ------------------------------------------------------------------- Equity Investments Segment Results ------------------------------------------------------------------- Quarterly Year-to-Date ------------------------------------------------------------------- Key Measures (in millions) 3Q00 2Q00 2000 1999 - --------------------------------------------------------------------------------------------------------------------------- Net Income $196 $36 $533 $250 Cash Basis Earnings (1) 199 39 541 258 Total Revenue 346 84 954 520 Shareholder Value Added 140 (14) 379 139 Average Equity to Average Assets 35.60% 34.23% 35.10% 36.75% Return on Average Equity 39.7% 8.2% 39.5% 25.1% Return on Tangible Equity (1) 41.8% 9.2% 41.9% 27.5% Efficiency Ratio 6.9% 34.3% 8.5% 18.6% Cash Basis Efficiency Ratio (1) 6.2% 31.2% 7.7% 17.1% Selected Average Balance Sheet Components (in millions) Total Loans and Leases $450 $418 $428 $293 Total Deposits 18 13 13 10 Total Earning Assets 469 444 450 359 (1) Cash basis calculations exclude goodwill and other intangible assets and their related amortization expense. Bank of America Corporation Global Corporate and Investment Banking Segment ------------------------------------------------------------------ Global Corporate and Investment Banking Segment Results ------------------------------------------------------------------ Quarterly Year-to-Date ------------------------------------------------------------------ Key Measures (in millions) 3Q00 2Q00 2000 1999 - --------------------------------------------------------------------------------------------------------------------------- Net Income $592 $578 $1,887 $1,659 Cash Basis Earnings (1) 633 619 2,008 1,778 Total Revenue 2,189 2,280 6,944 6,253 Shareholder Value Added 203 205 769 578 Average Equity to Average Assets 5.65% 5.68% 5.66% 6.22% Return on Average Equity 16.5% 16.8% 18.3% 16.6% Return on Tangible Equity (1) 19.5% 19.8% 21.5% 19.8% Efficiency Ratio 54.4% 54.5% 54.3% 55.4% Cash Basis Efficiency Ratio (1) 52.5% 52.7% 52.6% 53.5% Selected Average Balance Sheet Components (in millions) Total Loans and Leases $114,580 $110,363 $110,896 $109,394 Total Deposits 73,550 69,756 70,003 65,150 Total Earning Assets 213,741 204,578 204,893 181,454 ------------------------------------------------------------------- Global Corporate and Investment Banking Sub-Segment Results ------------------------------------------------------------------- Quarterly Year-to-Date ------------------------------------------------------------------- Key Measures (in millions) 3Q00 2Q00 2000 1999 - ---------------------------------------------------------------------------------------------------------------------------- Global Credit Products Total Revenue $759 $802 $2,306 $2,309 Shareholder Value Added 61 87 204 279 Cash Basis Earnings (1) 321 337 956 1,015 Cash Basis Efficiency Ratio (1) 20.9% 22.2% 22.1% 23.6% Global Capital Raising Total Revenue $745 $743 $2,289 $1,528 Shareholder Value Added 61 45 222 (38) Cash Basis Earnings (1) 156 136 482 154 Cash Basis Efficiency Ratio (1) 70.7% 72.4% 71.7% 85.5% Global Markets Total Revenue $343 $390 $1,327 $1,387 Shareholder Value Added 45 54 241 243 Cash Basis Earnings (1) 90 98 378 433 Cash Basis Efficiency Ratio (1) 59.2% 58.8% 55.0% 53.9% Global Treasury Services Total Revenue $342 $345 $1,022 $1,029 Shareholder Value Added 36 19 102 94 Cash Basis Earnings (1) 66 48 192 176 Cash Basis Efficiency Ratio (1) 76.2% 74.1% 75.6% 72.7% (1) Cash basis calculations exclude goodwill and other intangible assets and their related amortization expense.