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.
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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.
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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.
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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.
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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.
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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.
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<CAPTION>
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)
<S> <C> <C> <C> <C>
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).
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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
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Bank of America
Consolidated Financial Highlights
(Excludes Merger-Related Charges)
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(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
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
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.
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Bank of America Corporation
Consolidated Statement of Income
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(Dollars in millions, except per share information)
Third Second First Fourth Third
Quarter Quarter Quarter Quarter Quarter
2000 2000 2000 1999 1999
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<S> <C> <C> <C> <C> <C>
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
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Total interest income 11,265 10,737 10,086 9,622 9,294
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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
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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
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Total service charges 1,173 1,125 1,107 1,146 1,124
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Consumer investment and brokerage services 357 387 364 334 355
Corporate investment and brokerage services 114 105 121 103 63
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Total investment and brokerage services 471 492 485 437 418
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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
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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
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Total other noninterest expense 4,410 4,413 4,623 4,550 4,526
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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
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Operating net income $ 2,175 $ 2,063 $ 2,240 $ 2,115 $ 2,151
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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
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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
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Average common shares issued and outstanding (in thousands) 1,639,392 1,653,495 1,669,311 1,701,092 1,722,307
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Average diluted common shares issued and outstanding (in thousands) 1,661,031 1,676,089 1,688,318 1,725,187 1,755,146
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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.
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Bank of America Corporation
Consolidated Balance Sheet
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September 30 June 30 September 30
(Dollars in Millions) 2000 2000 1999
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<S> <C> <C> <C>
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
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Total securities 81,103 80,957 79,836
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Loans and leases 402,592 400,817 360,236
Allowance for credit losses (6,739) (6,815) (7,076)
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Loans and leases, net of allowance for credit losses 395,853 394,002 353,160
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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
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Total Assets $ 671,725 $ 679,538 $ 620,652
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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
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Total deposits 353,988 356,664 337,011
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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
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Total liabilities 624,866 633,677 574,763
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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)
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Total shareholders' equity 46,859 45,861 45,889
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Total liabilities and shareholders' equity $ 671,725 $ 679,538 $ 620,652
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Bank of America Corporation
Quarterly Taxable-Equivalent Data
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(Dollars in Millions)
Third Quarter 2000 Second Quarter 2000
-----------------------------------------------------------
Interest Interest
Average Income/ Yield/ Average Income/ Yield/
Balance Expense Rate Balance Expense Rate
-----------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
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
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Total securities 83,728 1,284 6.12 85,460 1,297 6.08
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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
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Total commercial 208,096 4,330 8.28 202,975 4,109 8.14
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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
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Total consumer 194,667 4,024 8.25 188,429 3,857 8.21
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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
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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
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Total assets $685,017 $672,588
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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 %
------------------------------------------------------------
<PAGE>
(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.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------
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
--------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 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 %
---------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
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
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
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
------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
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
----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
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
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Bank of America
Capital
------------------------------------------------------------------------------------------------------------------------------------
(Dollars in Millions)
Third Second First Fourth Third
Quarter Quarter Quarter Quarter Quarter
2000 2000 2000 1999 1999
----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
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
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
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
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
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.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Bank of America Corporation
Asset Management Segment
-------------------------------------------------------------------
Asset Management Segment Results
-------------------------------------------------------------------
Quarterly Year-to-Date
-------------------------------------------------------------------
Key Measures (in millions) 3Q00 2Q00 2000 1999
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
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.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Bank of America Corporation
Equity Investments Segment
-------------------------------------------------------------------
Equity Investments Segment Results
-------------------------------------------------------------------
Quarterly Year-to-Date
-------------------------------------------------------------------
Key Measures (in millions) 3Q00 2Q00 2000 1999
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
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.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
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
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
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.
</TABLE>
