SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
January 21, 1998
----------------------------------
(Date of earliest event reported)
BankAmerica Corporation
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 1-7377 94-1681731
----------------------------------------------------------------------
State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification Number)
Bank of America Center
555 California Street
San Francisco, California 94104
---------------------------------------------------------------------
Address of principal executive offices) (Zip Code)
415-622-3530
--------------------------------------------------------------------
(Registrant's telephone number, including area code)
<PAGE>
Item 5. Other Events.
------------
Attached hereto as Exhibit 99 is a copy of BankAmerica
Corporation's press release dated January 21, 1998 titled "BankAmerica
Fourth Quarter Earnings."
Item 7. Financial Statements, Pro Forma
-------------------------------
Financial Information and Exhibits.
-----------------------------------
(c) Exhibits
Exhibit
Number Description
- ------ -----------
99 BankAmerica Corporation press release dated January 21, 1998
titled "BankAmerica Fourth Quarter Earnings."
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BANKAMERICA CORPORATION
(Registrant)
Date: January 21, 1998
By /s/ JOHN J. HIGGINS
------------------------------
John J. Higgins
Executive Vice President
and Chief Accounting Officer
EXHIBIT INDEX
Exhibit
Number Description
- ------- -----------
99 BankAmerica Corporation press release dated
January 21, 1998 titled "BankAmerica Fourth
Quarter Earnings."
<PAGE>
Exhibit 99
[BANKAMERICA CORPORATION LOGO APPEARS HERE]
BankAmerica Corporation News
For release:
Contact: Mike Zampa
(415) 622-4524
BANKAMERICA FOURTH QUARTER EARNINGS
SAN FRANCISCO, January 21, 1998 -- BankAmerica Corporation (BAC) today
reported diluted earnings per common share for 1997 of $4.32, up 18 percent from
$3.65 in 1996. Net income for 1997 was $3,210 million, up 12 percent from $2,873
million for 1996. The return on average common equity for 1997 was 16.69
percent, an increase of 169 basis points from 1996.
BAC's diluted earnings per common share for the fourth quarter of 1997
were $1.12, an increase of 17 percent from $0.96 for the same period in 1996.
Net income for the period was $812 million, up 9 percent from $747 million for
the fourth quarter of 1996. The return on average common equity for the fourth
quarter of 1997 was 16.68 percent, an increase of 144 basis points from the same
period in 1996.
Diluted cash earnings per common share for 1997 were $4.69, up 17 percent
from $4.02 for 1996. Diluted cash earnings per common share for the fourth
quarter of 1997 were $1.21, up 14 percent from $1.06 for the fourth quarter of
1996.
The per share results include the effects of a two-for-one stock split
which was effective June 2, 1997.
"Our 1997 results demonstrate the financial discipline that has become a
core competency at BankAmerica," said David A. Coulter, Chairman and Chief
Executive Officer. "We displayed solid financial discipline throughout the year
by actively managing capital, maintaining favorable operating leverage, and
prudently managing risks. Our risk management processes were tested in the
fourth quarter by the volatile market conditions in Asia. I feel confident that
we have the risk management processes in place at BankAmerica to deal with
current and future market fluctuations. Our loan loss reserves are nearly four
times the level of nonaccrual assets."
Coulter cited the following examples of active capital management during
1997 that are key to improving the corporation's return on equity:
- more -
<PAGE>
o The completion of the sale of retail operations in Hawaii and the sale
of our consumer finance company, Security Pacific Financial Services
Inc.;
o The decisions to exit our Midwest retail facilities and to sell BA
Housing Services;
o The establishment of a strategic relationship with D.E. Shaw;
o The acquisition of Robertson Stephens and Company;
o The securitization of $2,150 million of credit card receivables;
o The sale of $12.5 billion of residential first mortgages in the
secondary market and $0.8 billion in loans from manufactured housing;
o The delivery of $3.2 billion in conforming adjustable rate mortgage
loans into a long-term Fannie Mae standby commitment;
o The repurchase of 31.7 million shares of common stock and the
redemption of Series H, K, L, M and N preferred stock, which reduced
stockholders' equity by $3,653 million.
FINANCIAL HIGHLIGHTS:
o Net interest income for the fourth quarter of 1997 was down $23 million
from the same period in 1996. BAC's net interest margin for the fourth
quarter of 1997 was 3.90 percent, down 23 basis points from the
comparable period in 1996 primarily due to a change in the mix of
assets and liabilities and to securitizations.
o Noninterest income for the fourth quarter of 1997 increased
$132 million from the same period in 1996. Excluding the effect
of a $147 million nontaxable gain on the initial public offering
of BA Merchant Services, Inc. (BPI-NYSE) common stock during the
fourth quarter of 1996, noninterest income would have increased
$279 million, or 21 percent, from the fourth quarter of 1996. The
fourth-quarter 1997 amounts included growth in other fees and
commissions of $195 million, due in large part to the acquisition
of Robertson Stephens and Company. In addition, income from private
equity investment activities increased $80 million, and gain on
sales of loans increased $73 million. However, these increases
were partially offset by a decrease of $71 million in trading income
due to the recent volatile conditions in emerging markets. In addition,
other income decreased primarily due to reductions in dividends on
investment securities of $50 million and in gain on sale of leased
property of $26 million.
- Page 2 -
<PAGE>
o Noninterest expense for the fourth quarter of 1997 was $2,209
million, a decrease of $41 million from the same period in 1996.
Excluding the effect of a $280 million pre-tax restructuring
charge during the fourth quarter of 1996, noninterest expense
would have increased $239 million from the fourth quarter of 1996.
This increase was partially attributable to increased salaries
expense of $134 million, primarily associated with the acquisition
of Robertson Stephens and Company.
o The provision for credit losses was $220 million for the fourth
quarter of 1997, down $40 million from the previous quarter and
remained the same as the fourth quarter of 1996. Net credit losses,
which included a large recovery from a single borrower, were $214
million for the fourth quarter of 1997.
o Nonaccrual assets were $899 million at December 31, 1997, a decrease
of $31 million, or 3 percent, from September 30, 1997, and a decrease
of $219 million, or 20 percent, from December 31, 1996.
o In connection with BAC's ongoing efforts to effectively manage
capital, BAC repurchased 7.4 million shares of its common stock
during the fourth quarter of 1997 at an average per-share price of
$74.57, which reduced stockholders' equity by approximately
$550 million. These shares were repurchased on the open market
over 56 trading days and represented approximately 7 percent of
the total volume of BAC common stock traded on those days.
Remaining buyback authority for common stock under the current
repurchase program totaled $1.8 billion at December 31, 1997.
o On December 15, 1997, BAC redeemed all outstanding shares of
its 8 1/2% Cumulative Preferred Stock, Series N, which reduced
stockholders' equity by $234 million. Remaining buyback authority
for preferred stock under the current repurchase program totaled
$191 million at December 31, 1997.
- Page 3 -
<PAGE>
This press release contains forward-looking statements conveying
management's expectations as to the future. These statements are subject to
uncertainties, including those discussed in "Forward-Looking Statements" in
BAC's most recent report on Form 10-K, that may cause actual results to differ
materially. Investors are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof.
(end of text, tables follow)
This earnings report and other material of interest to investors can be
found on the shareholder resources section of BankAmerica's Internet web site
@http://www.BankAmerica.com/shareholder@
- Page 4 -
<PAGE>
BankAmerica Corporation and Subsidiaries
Financial Highlights
<TABLE>
<CAPTION>
Table 1
Summary of Results and Statistical Data
Fourth Third Fourth
(dollar amounts in millions, Quarter Quarter Quarter
except per share data) 1997 1997 1996
------- ------- -------
<S> <C> <C> <C>
1 Net income $ 812 $ 819 $ 747
2 Earnings per common share/a/ 1.15 1.14 0.98
3 Diluted earnings per common
share/a/ 1.12 1.11 0.96
Rate of return (based on net income) on:
4 Average common equity 16.68% 16.82% 15.24%
5 Average total assets 1.24 1.26 1.21
6 Net interest margin/b/ 3.90 4.06 4.13
7 Full-time-equivalent staff
at period end (in thousands) 77.0 76.0 78.0
8 Employees at period
end (in thousands) 90.5 89.5 92.1
<CAPTION>
Year Ended
December 31
------------------
1997 1996
------ ------
<S> <C> <C>
9 Net income $3,210 $2,873
10 Earnings per common share/a/ 4.45 3.72
11 Diluted earnings per common share/a/ 4.32 3.65
Rate of return (based on net income) on:
12 Average common equity 16.69% 15.00%
13 Average total assets 1.25 1.19
14 Net interest margin/b/ 4.06 4.23
- ---------------------------------------------------------------------------
</TABLE>
/a/Restated to reflect the implementation of Statement of Financial
Accounting Standards No. 128, "Earnings per Share" (SFAS No. 128)
and a two-for-one stock split effective June 2, 1997.
/b/The net interest margin is computed on a tax-equivalent basis.
The taxable-equivalent basis adjustments to net interest income were
$5 million, $9 million, and $6 million, for the fourth quarter of 1997,
the third quarter of 1997, and the fourth quarter of 1996, respectively,
and $26 million, and $17 million for the years ended December 31, 1997
and 1996, respectively.
<PAGE>
BankAmerica Corporation and Subsidiaries
Financial Highlights
<TABLE>
<CAPTION>
Table 2
Summary of Results Excluding the Effects
of Amortization of Intangibles/a/
Fourth Third Fourth
(dollar amounts in millions, Quarter Quarter Quarter
except per share data) 1997 1997 1996
------- ------- -------
<S> <C> <C> <C>
1 Net income excluding
amortization of intangibles $ 879 $ 884 $815
2 Diluted cash earnings per
common share/b/ 1.21 1.20 1.06
3 Rate of return on average
common equity 18.09% 18.20% 16.71%
<CAPTION>
Year Ended
December 31
-----------------------
1997 1996
------- -------
<S> <C> <C>
4 Net income excluding
amortization of intangibles $3,474 $3,145
5 Diluted cash earnings per
common share/b/ 4.69 4.02
6 Rate of return on average
common equity 18.11% 16.52%
- -------------------------------------------------------------------------------
</TABLE>
/a/For purposes of this table, amortization amounts are related to those
intangibles that are deducted from Tier 1 capital under regulatory
guidelines. Amortization amounts excluded from this table totaled $67
million, $65 million, and $68 million, for the fourth quarter of 1997, the
third quarter of 1997, and the fourth quarter of 1996, respectively, and $264
million and $272 million for the years ended December 31, 1997 and 1996,
respectively.
/b/Restated to be consistent with the requirements of SFAS No. 128 and a
two-for-one stock split effective June 2, 1997.
================================================================================
<TABLE>
<CAPTION>
Table 3
Tier 1 Capital Generation
Year Ended
December 31
----------------------
(in millions) 1997 1996
------- -------
<S> <C> <C>
Generation:
1 Net income $ 3,210 $ 2,873
2 Amortization of intangibles 264 272
3 Common stock issuances and other 706 391
4 Trust preferred securities issued 396 1,477
------- -------
5 Total generation 4,576 5,013
Applications:
6 Common stock dividends (853) (780)
7 Preferred stock dividends (100) (185)
8 Common stock repurchased (2,025) (1,351)
9 Preferred stock redeemed (1,347) (680)
------- -------
10 Total applications (4,325) (2,996)
11 Capital attributed to growth
in risk-weighted assets (757)/a/ (1,131)
------ -------
12 Net capital generated (applied) $ (506) $ 886
====== =======
- --------------------------------------------------------------------------------
</TABLE>
/a/Amount is preliminary.
<PAGE>
BankAmerica Corporation and Subsidiaries
Financial Highlights
<TABLE>
<CAPTION>
Table 4
Stock and Capital Data
(dollar amounts in millions, Dec. 31 Sept. 30 Dec. 31
except per share data) 1997 1997 1996
------- -------- -------
<S> <C> <C> <C>
1 Book value per common share $27.94 $27.51 $ 26.00/a/
Common stock cash dividends:
2 Quarter ended 211 212 193
3 Year-to-date 853 642 780
Preferred stock cash dividends:
4 Quarter ended 14 22 44
5 Year-to-date 100 86 185
6 Number of common shares
outstanding (in thousands) 688,057 693,468 710,534/a/
Average number of common shares
outstanding (in thousands):
7 Quarter ended 690,878 695,835 715,609/a/
8 Year-to-date 699,189 701,959 722,373/a/
Average number of diluted
common shares outstanding
(in thousands)/b/:
9 Quarter ended 714,409 718,384 731,022/a/
10 Year-to-date 719,777 721,566 736,055/a/
11 Common equity to total assets 7.39% 7.41% 7.37%
12 Tier 1 risk-based capital ratio 7.52/c,d/ 7.64 7.77
13 Total risk-based capital ratio 11.55/c,d/ 11.60 11.79
14 Tier 1 risk-based capital $ 17,291/c,d $ 17,161 $ 17,044
15 Total risk-based capital 26,556/c,d/ 26,071 25,880
16 Risk-weighted assets 229,858/c,d/ 224,657 219,483
- -------------------------------------------------------------------------------
</TABLE>
/a/Restated to reflect a two-for-one stock split effective June 2, 1997.
/b/Reflects the implementation of SFAS No. 128.
/c/Amounts are preliminary.
/d/Includes BAC's broker/dealer subsidiary.
===============================================================================
<TABLE>
<CAPTION>
Table 5
Selected Average Balance Sheet Components
Fourth Third Fourth
Quarter Quarter Quarter
(in millions) 1997 1997 1996
-------- -------- --------
<S> <C> <C> <C>
1 Available-for-sale securities $ 12,878 $ 11,984 $ 11,763
2 Held-to-maturity securities 3,621 3,753 4,160
3 Loans 165,769 165,852 161,545
4 Earning assets 216,115 216,154 206,315
5 Total assets 258,588 257,380 245,477
6 Deposits 171,303 170,279 162,813
7 Interest-bearing liabilities 185,360 178,933 170,046
8 Common equity 18,968 18,787 18,374
9 Total equity 19,774 20,022 20,616
</TABLE>
<PAGE>
BankAmerica Corporation and Subsidiaries
Financial Highlights
<TABLE>
<CAPTION>
Table 6
Business Sectors
Year Ended December 31, 1997/a/
(dollar amounts -------------------------------------------
in billions except Return
for net income, Average Average on Expense
which is Net Total Total Common to
in millions) Income Assets Deposits Equity Revenue/b/
------ ------- -------- ------ -------
<S> <C> <C> <C> <C> <C>
1 Consumer banking $1,458 $ 94 $100 16.77% 58.08%
2 U.S. Corporate and
international
banking 900 105 49 13.48 52.62
3 Middle-market
banking 383 25 8 19.44 40.70
4 Commercial real
estate 228 10 2 32.42 25.21
5 Wealth management 73 5 7 17.85 60.89
6 All other 168 17 3 NM NM
------ ---- ----
7 Total $3,210 $256 $169 16.69% 54.34%
====== ==== ====
<CAPTION>
Year Ended December 31, 1996/a/
-------------------------------------------
Return
Average Average on Expense
Net Total Total Common to
Income Assets Deposits Equity Revenue/b/
------ ------- -------- ------ -------
<S> <C> <C> <C> <C> <C>
1 Consumer banking $1,097 $ 94 $97 11.89% 60.35%
2 U.S. Corporate and
international
banking 891 95 45 14.43 58.19
3 Middle-market
banking 374 23 7 19.97 42.47
4 Commercial real
estate 206 10 2 26.95 29.01
5 Wealth management 62 4 7 15.26 64.99
6 All other 243 16 4 NM NM
----- ---- ----
7 Total $2,873 $242 $162 15.00% 56.86%
====== ==== ====
- --------------------------------------------------------------------------------
</TABLE>
/a/Amounts are preliminary. For comparability purposes, both 1997 and
1996 amounts reflect BAC's business-sector allocation methodologies
in effect at December 31, 1997.
/b/Excludes net other real estate owned expense, amortization of
intangibles, and expenses associated with trust preferred securities.
NM - Not meaningful.
<PAGE>
BankAmerica Corporation and Subsidiaries
Financial Highlights
<TABLE>
<CAPTION>
Table 7
Trading-Related Income
Fourth Third Fourth
Quarter Quarter Quarter
(in millions) 1997/a/ 1997 1996
------- ------- -------
<S> <C> <C> <C>
Trading income:
1 Interest rate products $ (28) $ 24 $ 19
2 Foreign exchange contracts 139 106 64
3 Debt instruments (48) 93 51
---- ---- ----
4 Total trading income $ 63 $223 $134
==== ==== ====
Other trading-related income/b/:
5 Interest rate products $ 15 $ 6 $ 13
6 Foreign exchange contracts - 1 3
7 Debt instruments 73 49 53
---- ---- ----
8 Total other trading-related
income $ 88 $ 56 $ 69
==== ==== ====
<CAPTION>
Year Ended
December 31
--------------------
1997/a/ 1996
------ ------
<S> <C> <C>
Trading income:
9 Interest rate products $ 25 $ 56
10 Foreign exchange contracts 444 316
11 Debt instruments 223 258
---- ----
12 Total trading income $692 $630
==== ====
Other trading-related income/b/:
13 Interest rate products $ 43 $ 31
14 Foreign exchange contracts 7 20
15 Debt instruments 219 208
---- ----
16 Total other trading-related
income $269 $259
==== ====
- ----------------------------------------------------------------------
</TABLE>
/a/Detailed breakouts of total amounts are preliminary.
/b/Primarily includes the net interest revenue associated with the
respective products.
<PAGE>
BankAmerica Corporation and Subsidiaries
Financial Highlights
<TABLE>
<CAPTION>
Table 8
Impact of Credit Card Securitization
Fourth Quarter 1997/a/
------------------------------------------
Before
(dollar amounts Credit Card Credit Card
in millions) Securitization Securitization Reported
-------------- -------------- --------
<S> <C> <C> <C>
Operating Results:
1 Net interest income $ 2,184 $ (77) $ 2,107
2 Credit card fees 119 (17) 102
3 Other noninterest income 1,470 59 /b/ 1,529
-------- ------- --------
4 Total revenue 3,773 (35) 3,738
5 Noninterest expense 2,209 - 2,209
-------- ------- --------
6 Income before provision
for credit losses and
income taxes 1,564 (35) 1,529
7 Provision for credit
losses 272 (52)/c/ 220
-------- ------- --------
8 Income before income
taxes $ 1,292 $ 17 $ 1,309
======== ======== ========
9 Net interest margin 3.98% (0.08)% 3.90%
Balance Sheet Data at
Period End:
10 Credit card loans
outstanding $ 10,318 $(3,621) $ 6,697
11 Total assets 263,780 (3,621) 260,159
Average Balance
Sheet Data:
12 Credit card loans 10,024 (3,132) 6,892
13 Earning assets 219,247 (3,132) 216,115
14 Total assets 261,720 (3,132) 258,588
15 Net credit losses - credit
card portfolio 164 (52) 112
Selected Financial Ratios:
16 Annualized ratio of net
credit losses on credit
card loans to average credit
card loans outstanding 6.46% (0.05)% 6.41%
17 Delinquent credit card
loan ratio/d/ 2.89 (0.04) 2.85
- -----------------------------------------------------------------------
</TABLE>
/a/Includes the effects of accumulated credit card securitizations
of $3,621 million at December 31, 1997.
/b/Includes $17 million associated with the requirements of
Statement of Financial Accounting Standards No. 125,
"Accounting for Transfers and Servicing of Financial Assets
and Extinguishments of Liabilities."
/c/Represents charge-offs on the investor's share.
/d/60 days or more past due.
<PAGE>
BankAmerica Corporation and Subsidiaries
Financial Highlights
<TABLE>
<CAPTION>
Table 9
Loan Outstandings
Dec. 31 Sept. 30 Dec. 31
(in millions) 1997 1997 1996
-------- -------- --------
<S> <C> <C> <C>
Domestic
Consumer:
1 Residential first mortgages $ 31,749 $ 34,279 $ 37,459
2 Residential junior mortgages 14,847 14,915 14,743
3 Other installment 18,418 18,432 16,979
4 Credit card/a/ 6,697 7,050 8,707
5 Other individual lines of credit 1,937 1,939 1,948
6 Other 461 442 401
-------- -------- -------
7 Total consumer 74,109 77,057 80,237
Commercial:
8 Commercial and industrial 36,602 34,082 33,404
9 Loans secured by real estate 12,897 12,833 12,488
10 Financial institutions 3,485 3,452 3,109
11 Lease financing 2,892 2,700 2,542
12 Construction and development
loans secured by real estate 2,206 2,257 2,252
13 Loans for purchasing or carrying
securities 2,668 2,000 1,941
14 Agricultural 1,824 1,774 1,696
15 Other 1,896 1,745 1,270
-------- -------- --------
16 Total commercial 64,470 60,843 58,702
-------- -------- --------
17 Total domestic loans 138,579 137,900 138,939
Foreign
18 Commercial and industrial 18,484 18,260 16,394
19 Banks and other financial
institutions 3,904 4,295 3,958
20 Governments and official
institutions 840 861 970
21 Other 5,304 5,670 5,154
-------- -------- --------
22 Total foreign loans 28,532 29,086 26,476
-------- -------- --------
23 Total loans $167,111 $166,986 $165,415
======== ======== ========
- ------------------------------------------------------------------------
</TABLE>
/a/Excludes outstanding securitized credit card receivables of
$3,621 million, $2,971 million, and $1,471 million at December 31,
1997, September 30, 1997, and December 31, 1996, respectively.
<PAGE>
BankAmerica Corporation and Subsidiaries
Financial Highlights
<TABLE>
<CAPTION>
Table 10
Selected Credit Quality Data
Dec. 31 Sept. 30 Dec. 31
(dollar amounts in millions) 1997 1997 1996
-------- -------- --------
<S> <C> <C> <C>
Nonaccrual assets:
1 Commercial and industrial $214 $263 $ 289
2 Commercial loans secured by real
estate 104 136 206
3 Construction and development
loans secured by real estate 30 39 95
4 Consumer 393 378 415
5 Foreign 158 114 113
---- ---- ------
6 Total nonaccrual assets $899 $930 $1,118
==== ==== ======
7 Restructured loans $274 $285 $ 302
8 Loans past due 90 days or more
and still accruing interest/a/ 203 197 235
9 Other real estate owned 205 197 353
10 Allowance for credit losses to
total loans 2.09% 2.10% 2.13%
11 Allowance for credit losses to
total nonaccrual assets 389.31 376.70 315.11
Annualized ratio of net credit
losses to average total loan
outstandings:
12 Quarter ended 0.51 0.62 0.51
13 Year-to-date 0.54 0.55 0.58
- ----------------------------------------------------------------------
</TABLE>
/a/Includes consumer loans of $189 million, $177 million, and
$187 million at December 31, 1997, September 30, 1997, and
December 31, 1996, respectively.
======================================================================
<TABLE>
<CAPTION>
Table 11
Analysis of Change in Nonaccrual Assets
Fourth Third Second First
Quarter Quarter Quarter Quarter
(in millions) 1997 1997 1997 1997
------- ------- ------- -------
<S> <C> <C> <C> <C>
1 Balance, beginning
of period $930 $861 $1,030 $1,118
Additions:
2 Loans placed on
nonaccrual status 127 244 103 108
Deductions:
3 Sales (18) (26) (103) (3)
4 Restored to
accrual status (34) (31) (38) (75)
5 Foreclosures - - (1) (8)
6 Charge-offs (57) (47) (20) (10)
7 Other, primarily
payments (49) (71) (110) (100)
---- ------ ------ ------
8 Balance, end of period $899 $ 930 $ 861 $1,030
==== ====== ====== ======
</TABLE>
<PAGE>
BankAmerica Corporation and Subsidiaries
Financial Highlights
<TABLE>
<CAPTION>
Table 12
Net Credit Losses (Recoveries)
Fourth Third Fourth
Quarter Quarter Quarter
(in millions) 1997 1997 1996
-------- -------- --------
<S> <C> <C> <C>
Domestic consumer:
1 Residential first mortgages $ 2 $ 4 $ 7
2 Residential junior mortgages 9 7 12
3 Credit card 112 122 104
4 Other installment 68 63 64
5 Other individual lines of credit 22 19 17
6 Other 5 5 4
Domestic commercial:
7 Commercial and industrial 12 46 -
8 Loans secured by real estate (2) 2 (3)
9 Construction and development
loans secured by real estate 15 1 1
10 Financial institutions, lease
financing, loans for purchasing
or carrying securities,
and agricultural (75) (5) 1
---- ---- ----
11 Total domestic 168 264 207
12 Foreign 46 (5) -
---- ---- ----
13 Total net credit losses $214 $259 $207
==== ==== ====
</TABLE>
====================================================================
<TABLE>
<CAPTION>
Table 13
Domestic Consumer Loan Delinquency Information/a/
Dec. 31 Sept. 30 Dec. 31
(dollar amounts in millions) 1997 1997 1996
-------- -------- --------
<S> <C> <C> <C>
Delinquent consumer loans:
1 Residential first mortgages $417 $431 $477
2 Residential junior mortgages 44 44 62
3 Credit card 191 192 206
4 Other 137 134 129
---- ---- ----
5 Total delinquent
consumer loans $789 $801 $874
==== ==== ====
Delinquent consumer loan ratios/b/:
6 Residential first mortgages 1.31% 1.26% 1.27%
7 Residential junior mortgages 0.30 0.29 0.42
8 Credit card 2.85 2.72 2.36
9 Other 0.66 0.65 0.67
10 Total delinquent consumer
loan ratio 1.06% 1.04% 1.09%
==== ==== ====
- --------------------------------------------------------------------
</TABLE>
/a/60 days or more past due.
/b/Ratios represent delinquent balances expressed as a percentage
of total loans for that loan category.
<PAGE>
BankAmerica Corporation and Subsidiaries
Financial Highlights
<TABLE>
<CAPTION>
Table 14
Allocation of Allowance for Credit Losses by Loan Type/a/
December 31
----------------------------------------
1997 1996
------------------- ------------------
Percent Percent
(dollar amounts of Loan of Loan
in millions) Allowance Category Allowance Category
--------- -------- --------- --------
<S> <C> <C> <C> <C>
Domestic consumer:
1 Residential first
mortgages $ 86 0.27% $ 110 0.29%
2 Residential junior
mortgages 112 0.75 165 1.12
3 Credit card 411 6.13 385 4.42
4 Other consumer 822 3.95 755 3.91
Domestic commercial:
5 Commercial and industrial/b/ 513 1.25 528 1.44
6 Loans secured by
real estate 189 1.46 208 1.67
7 Financial institutions 11 0.32 4 0.12
8 Lease financing 32 1.11 45 1.79
9 Construction and
development loans
secured by real estate 48 2.16 73 3.26
10 Agricultural 21 1.15 43 2.53
11 Foreign 1,005 3.52 425 1.61
12 Unallocated 250 - 782 -
------ ------
13 Total $3,500 2.09% $3,523 2.13%
====== ======
- --------------------------------------------------------------------------------
</TABLE>
/a/Includes the allowance for credit losses on impaired loans of $81 million and
$115 million at December 31, 1997 and 1996, respectively. While management
has allocated the allowance to various portfolio segments, it is general in
nature and is available for the loan portfolio in its entirety.
/b/Includes the allowance for credit losses for commercial and industrial loans,
loans for purchasing or carrying securities, and other commercial loans.
================================================================================
<TABLE>
<CAPTION>
Table 15
Composition of Allowance for Credit Losses
December 31
--------------------
1997 1996
------ ------
<S> <C> <C>
Special Mention and Classified:
1 Historical loss experience $ 353 $ 349
2 Credit management
allocated component 592 426
------ ------
3 Total special mention
and classified 945 775
Other:
4 Domestic consumer 1,432 1,414
5 Domestic commercial 282 252
6 Foreign 591 300
------ ------
7 Total allocated 3,250 2,741
8 Unallocated 250 782
------ ------
9 Total $3,500 $3,523
====== ======
</TABLE>
<PAGE>
BankAmerica Corporation and Subsidiaries
Financial Highlights
<TABLE>
<CAPTION>
Table 16
Regional Foreign Exposures
(in millions) December 31, 1997
------------------------------------------------------
Cross Border Loans
-------------------------------
Total Net Local
Cross-border Medium Currency
Region/ Outstand- Short- and Long Outstand-
Country ings/a/ Term Term ings/b/ Other/c/
----------- ----- -------- --------- -------
<S> <C> <C> <C> <C> <C>
Asia
1 China $ 653 $ 383 $ 58 $ 2 $ 210
2 Hong Kong 1,328 498 202 345 283
3 India 1,191 142 212 546 291
4 Indonesia 684 136 230 81 237
5 Japan 2,626 205 207 1,442 772
6 Korea (South) 2,838 691 87 208 1,852
7 Malaysia 532 249 85 156 42
8 Pakistan 351 2 6 312 31
9 Philippines 601 184 67 - 350
10 Singapore 1,512 322 54 624 512
11 Taiwan 865 565 182 - 118
12 Thailand 881 436 182 166 97
13 Other 73 50 8 10 5
------ ------ ------ ------ ------
14 Total 14,135 3,863 1,580 3,892 4,800
Central and
Eastern Europe
15 Russia
Federation 426 33 5 - 388
16 Other 287 41 77 10 159
-------- ----- ------ ------ ------
17 Total 713 74 82 10 547
Latin America
18 Argentina 1,365 288 247 354 476
19 Brazil 2,202 741 240 791 430
20 Chile 1,516 339 742 426 9
21 Colombia 584 112 287 144 41
22 Mexico 3,839 803 831/d/ 340 1,865
23 Venezuela 384 73 - - 311
24 Other 139 - 4 - 135
-------- ------ ------ ------ ------
25 Total 10,029 2,356 2,351 2,055 3,267
26 Total $24,877 $6,293/e/ $4,013 $5,957 $8,614
======= ====== ====== ====== ======
- --------------------------------------------------------------------------------
</TABLE>
/a/Amounts are preliminary. Includes the following assets with borrowers in a
foreign country: loans, accrued interest, acceptances, interest-bearing
deposits in banks, trading account assets, available-for-sale and
held-to-maturity securities, other interest-earning investments and other
monetary assets. Amounts also include local currency outstandings that are
not funded by local currency borrowings, and available-for-sale and
held-to-maturity securities that are collateralized by U.S. Treasury
securities. Amounts do not include unrealized gains on off-balance-sheet
instruments which totaled $10,929 million for consolidated BAC. For the
countries in this table, these gains totaled $3,426 million, including $1,429
and $527 million for Japan and Thailand, respectively. No other country
individually exceeded $400 million in total unrealized gains.
/b/Represents local currency assets in a foreign country that are neither hedged
nor funded by local currency borrowings. These amounts do not necessarily
reflect the results of BAC's foreign currency management activities and
therefore, BAC's net foreign exchange exposures in the respective currencies
are typically significantly smaller.
/c/Includes the following:
- Available-for-sale and held-to-maturity securities that are collateralized
by U.S. Treasury securities as follows: Mexico $1,024 million, Venezuela
$233 million, Philippines $20 million, and Latin America Other $87 million.
Held-to-maturity securities amounted to $1,067 million with a fair value of
$1,091 million.
- Accrued interest receivable, acceptances, interest-bearing deposits in
banks, trading account assets, other interest-earning investments, and
other short-term monetary assets.
/d/Includes a $30 million loan that is collateralized
by zero-coupon U.S. Treasury securities.
/e/Total loans include nonaccrual loans of $110 million.
<PAGE>
BankAmerica Corporation and Subsidiaries
Financial Highlights
<TABLE>
<CAPTION>
Table 17
Performance by Geographic Area
Total Year ended
Assets December 31/a/
(in millions) Year at Dec. 31/a/ Net Income
---- ---------- ------------
<S> <C> <C> <C>
1 Domestic 1997 $211,487 $3,070
1996 205,105 2,394
2 Asia 1997 23,956 (218)
1996 20,353 224
3 Europe, Middle East,
and Africa 1997 20,414 143
1996 22,339 107
4 Latin America and
the Caribbean 1997 2,075 194
1996 1,582 121
5 Canada 1997 2,227 21
1996 1,374 27
6 Total Foreign 1997 48,672 140
1996 45,648 479
7 BankAmerica Corporation 1997 260,159 3,210
1996 250,753 2,873
- --------------------------------------------------------------------------------
</TABLE>
/a/Amounts are preliminary.
<PAGE>
BankAmerica Corporation and Subsidiaries
Consolidated Statement of Operations
<TABLE>
<CAPTION>
Fourth Third Fourth
Quarter Quarter Quarter
(in millions) 1997 1997 1996
------- ------- -------
<S> <C> <C> <C>
Interest Income
1 Loans, including fees $3,430 $3,522 $3,388
2 Interest-bearing
deposits in banks 104 107 145
3 Federal funds sold 10 14 7
4 Securities purchased under
resale agreements 233 208 144
5 Trading account assets 340 323 270
6 Available-for-sale and held-to-
maturity securities 290 277 284
------ ------ ------
7 Total interest income 4,407 4,451 4,238
Interest Expense
8 Deposits 1,501 1,502 1,406
9 Federal funds purchased 21 11 20
10 Securities sold under
repurchase agreements 256 227 155
11 Other short-term borrowings 269 268 254
12 Long-term debt 253 249 273
------ ------ ------
13 Total interest expense 2,300 2,257 2,108
------ ------ ------
14 Net interest income 2,107 2,194 2,130
15 Provision for credit losses 220 260 220
------ ------ ------
16 Net interest income
after provision
for credit losses 1,887 1,934 1,910
Noninterest Income
17 Deposit account fees 362 364 364
18 Credit card fees 102 96 94
19 Trust fees 75 62 57
20 Other fees and commissions 565 424 370
21 Trading income 63 223 134
22 Private equity investment
activities 188 140 108
23 Net gain on sales of loans 93 53 20
24 Net gain on sales of
subsidiaries and operations 34 139 5
25 Net gain on available-for-sale
securities 49 33 20
26 Gain on issuance of
subsidiary's stock - - 147
27 Other income 100 136 180
------ ------ ------
28 Total noninterest income 1,631 1,670 1,499
Noninterest Expense
29 Salaries 968 892 834
30 Employee benefits 153 177 167
31 Occupancy 192 192 193
32 Equipment 188 182 184
33 Professional services 134 107 95
34 Communications 95 95 92
35 Amortization of intangibles 90 88 92
36 Regulatory fees and
related expenses (1) 10 2
37 Restructuring charges - - 280
38 Other expense 390 489 311
------ ------ ------
39 Total noninterest
expense 2,209 2,232 2,250
------ ------ ------
40 Income before
income taxes 1,309 1,372 1,159
41 Provision for income taxes 497 553 412
------ ------ ------
42 Net Income $ 812 $ 819 $ 747
====== ====== ======
</TABLE>
<PAGE>
BankAmerica Corporation and Subsidiaries
Consolidated Statement of Operations
<TABLE>
<CAPTION>
Year Ended
December 31
----------------------
(in millions) 1997 1996
------- -------
<S> <C> <C>
Interest Income
1 Loans, including fees $13,872 $13,363
2 Interest-bearing deposits in banks 415 453
3 Federal funds sold 41 29
4 Securities purchased under
resale agreements 776 653
5 Trading account assets 1,230 1,001
6 Available-for-sale and held-to-
maturity securities 1,123 1,160
------- -------
7 Total interest income 17,457 16,659
Interest Expense
8 Deposits 5,793 5,359
9 Federal funds purchased 64 79
10 Securities sold under repurchase
agreements 810 695
11 Other short-term borrowings 1,099 883
12 Long-term debt 1,022 1,056
------- -------
13 Total interest expense 8,788 8,072
------- -------
14 Net interest income 8,669 8,587
15 Provision for credit losses 950 885
------- -------
16 Net interest income after
provision for credit losses 7,719 7,702
Noninterest Income
17 Deposit account fees 1,447 1,399
18 Credit card fees 378 355
19 Trust fees 255 229
20 Other fees and commissions 1,781 1,383
21 Trading income 692 630
22 Private equity investment activities 510 427
23 Net gain on sales of loans 249 89
24 Net gain on sales of
subsidiaries and operations 213 180
25 Net gain on available-for-sale
securities 116 61
26 Gain on issuance of subsidiary's stock - 147
27 Other income 487 512
------- -------
28 Total noninterest income 6,128 5,412
Noninterest Expense
29 Salaries 3,572 3,291
30 Employee benefits 708 773
31 Occupancy 753 757
32 Equipment 725 702
33 Professional services 398 344
34 Communications 379 363
35 Amortization of intangibles 358 373
36 Regulatory fees and related expenses 29 123
37 Restructuring charges - 280
38 Other expense 1,599 1,335
------- -------
39 Total noninterest expense 8,521 8,341
------- -------
40 Income before income taxes 5,326 4,773
41 Provision for income taxes 2,116 1,900
------- -------
42 Net Income $ 3,210 $ 2,873
======= =======
</TABLE>
<PAGE>
BankAmerica Corporation and Subsidiaries
Consolidated Balance Sheet
<TABLE>
<CAPTION>
Dec. 31 Sept. 30 Dec. 31
(in millions) 1997 1997 1996
-------- -------- --------
<S> <C> <C> <C>
Assets
1 Cash and due from banks $ 14,280 $ 13,854 16,223
2 Interest-bearing deposits in banks 5,862 5,368 5,708
3 Federal funds sold 105 48 134
4 Securities purchased under resale
agreements 9,774 10,076 7,275
5 Trading account assets 15,551 16,351 12,205
6 Available-for-sale securities 12,786 12,408 12,113
7 Held-to-maturity securities 3,667 3,689 4,138
8 Loans 167,111 166,986 165,415
9 Less: Allowance for credit losses 3,500 3,504 3,523
-------- -------- --------
10 Net loans 163,611 163,482 161,892
11 Customers' acceptance liability 3,561 3,154 2,861
12 Accrued interest receivable 1,570 1,593 1,441
13 Goodwill, net 3,822 3,727 3,938
14 Identifiable intangibles, net 1,374 1,459 1,616
15 Unrealized gains on off-balance-
sheet instruments 10,929 7,892 7,682
16 Premises and equipment, net 3,880 3,909 3,987
17 Other assets 9,387 10,510 9,540
-------- -------- --------
18 Total Assets $260,159 $257,520 $250,753
======== ======== ========
Liabilities & Stockholders' Equity
Deposits in domestic offices:
19 Interest-bearing $ 94,495 $ 94,074 $ 84,133
20 Noninterest-bearing 33,704 31,206 39,694
Deposits in foreign offices:
21 Interest-bearing 42,326 44,450 42,732
22 Noninterest-bearing 1,512 1,683 1,456
- -- -------- -------- --------
23 Total deposits 172,037 171,413 168,015
24 Federal funds purchased 3,751 1,349 2,176
25 Securities sold under repurchase
agreements 11,159 11,024 7,644
26 Other short-term borrowings 15,702 18,701 17,566
27 Acceptances outstanding 3,563 3,154 2,861
28 Accrued interest payable 978 1,023 879
29 Unrealized losses on off-balance-
sheet instruments 10,502 7,541 7,633
30 Other liabilities 6,835 7,318 6,004
31 Long-term debt 13,922 14,198 15,785
-------- -------- --------
32 Total liabilities 238,449 235,721 228,563
33 Corporation obligated
mandatorily redeemable
preferred securities of
subsidiary trusts holding
solely junior subordinated
deferrable interest
debentures of the corporation
(trust preferred
securities) 1,873 1,873 1,477
STOCKHOLDERS' EQUITY
34 Preferred stock 614 848 2,242
35 Common stock 1,210/a/ 1,210/a/ 605
36 Additional paid-in capital 7,974/a/ 7,947/a/ 8,467
37 Retained earnings 13,726 13,168 11,500
38 Net unrealized gain on
available-for-sale securities 137 108 32
39 Common stock in treasury, at cost (3,824) (3,355) (2,133)
-------- -------- --------
40 Total stockholders' equity 19,837 19,926 20,713
-------- -------- --------
41 Total Liabilities and
Stockholders' Equity $260,159 $257,520 $250,753
======== ======== ========
- ------------------------------------------------------------------------
</TABLE>
/a/Reflects a two-for-one stock split effective June 2, 1997.
