Bank of America
1Q24 Financial Results
April 16, 2024
1Q24 Financial Results
1Q24 | 1Q24 | 1Q23 | Inc / (Dec) | Inc / (Dec) | |||||||||
($B, except per share data) | Adjusted1 | Adjusted1 | |||||||||||
Total Revenue, net of interest expense | $25.8 | $25.8 | $26.3 | ($0.4) | (2) % | ($0.4) | (2) % | ||||||
Provision for credit losses | 1.3 | 1.3 | 0.9 | 0.4 | 42 | 0.4 | 42 | ||||||
Net charge-offs | 1.5 | 1.5 | 0.8 | 0.7 | 86 | 0.7 | 86 | ||||||
Reserve build (release)2 | (0.2) | (0.2) | 0.1 | (0.3) | N/M | (0.3) | N/M | ||||||
Noninterest expense | 17.2 | 16.5 | 16.2 | 1.0 | 6 | 0.3 | 2 | ||||||
Pretax income | 7.3 | 8.0 | 9.1 | (1.8) | (20) | (1.1) | (12) | ||||||
Pretax, pre-provision income3 | 8.6 | 9.3 | 10.0 | (1.4) | (14) | (0.7) | (7) | ||||||
Income tax | 0.6 | 0.8 | 0.9 | (0.3) | (37) | (0.2) | (19) | ||||||
Net income | $6.7 | $7.2 | $8.2 | ($1.5) | (18) | ($1.0) | (12) | ||||||
Diluted earnings per share | $0.76 | $0.83 | $0.94 | ($0.18) | (19) | ($0.11) | (12) | ||||||
Average diluted common shares (in millions) | 8,031 | 8,031 | 8,182 | (151) | (2) | (151) | (2) | ||||||
Return Metrics and Efficiency Ratio | |||||||||||||
Return on average assets | 0.83 | % | 0.89 | % | 1.07 | % | |||||||
Return on average common shareholders' equity | 9.4 | 10.2 | 12.5 | ||||||||||
Return on average tangible common shareholders' equity3 | 12.7 | 13.8 | 17.4 | ||||||||||
Efficiency ratio | 67 | 64 | 62 | ||||||||||
1Q24 results included additional FDIC special assessment accrual of $0.7B in pretax noninterest expense, which reduced earnings by $0.07 per diluted common share
Note: Amounts may not total due to rounding. N/M stands for not meaningful.
- Amounts in this column (other than total revenue, net of interest expense, provision for credit losses, and average diluted common shares) are adjusted for the FDIC special assessment accrual. Adjusted amounts
represent non-GAAP financial measures. For a reconciliation to the most directly comparable GAAP financial measures, see note A on slide 30. For important presentation information, see slide 34. | |
2 For more information on reserve build (release), see note B on slide 31. | 2 |
3 Represent non-GAAP financial measures. For more information on pretax, pre-provision income and a reconciliation to the most directly comparable GAAP financial measure, see note C on slide 31. For important |
presentation information about these measures, see slide 34.
Continued Organic Growth in 1Q24
Consumer Banking
Added ~245,000 net new checking accounts; 21 consecutive quarters of growth
Added over 1MM credit card accounts1
Record 3.9MM consumer investment accounts, with $44B net client flows since 1Q23
Global Wealth & Investment Management
Added over 7,300 net new relationships across Merrill and Private Bank
Opened ~29,000 new bank accounts
Record client balances of nearly $4T, up 13% YoY
$5.6T total deposits, loans, and investments balances $60B total net wealth spectrum flows since 1Q232
Global Banking | Global Markets |
#3 investment banking fee ranking; grew market share | 8 consecutive quarters of YoY sales and trading |
115 bps vs. 1Q233 | revenue growth |
Grew investment banking fees 35% YoY to $1.6B | Highest 1Q sales and trading revenue in over a decade |
Added 25% more Global Commercial Banking new | Record average loan balances of $134B, up 7% YoY |
clients YTD vs. 1Q234 | Zero trading loss days in 1Q24 |
Grew average deposits 7% from 1Q23, including 12% | |
growth in Corporate Bank deposits |
- Includes credit cards across Consumer Banking, Small Business, and Global Wealth & Investment Management.
2 Includes net client flows across Merrill, Private Bank, and Consumer Investments. 3 Source: Dealogic as of March 31, 2024.
4 Preliminary as of March 31, 2024.
3
1Q24 Highlights
(Comparisons to 1Q23, unless otherwise noted)
- Net income of $6.7B; diluted earnings per share (EPS) of $0.76; ROE1 9.4%, ROTCE1,2 12.7%
- Excluding FDIC special assessment, adj. net income $7.2B; adj. diluted EPS $0.83; adj. ROE 10.2%, adj. ROTCE 13.8%3
- Revenue, net of interest expense, of $25.8B ($26.0B FTE)1,2 decreased $0.4B, or 2%, including higher investment banking and asset management fees, as well as sales and trading revenue, and lower net interest income (NII)
- NII of $14.0B ($14.2B FTE)2 decreased $0.4B, or 3%, as higher deposit costs more than offset higher asset yields and modest loan growth
- Provision for credit losses of $1.3B
- Net charge-offs (NCOs) of $1.5B4 increased compared to 1Q23 and 4Q23, driven primarily by credit card and commercial real estate office
- Net charge-off ratio of 58 bps vs. 32 bps in 1Q23 and 45 bps in 4Q234
- Net reserve release of $0.2B vs. net reserve build of $0.1B in 1Q23 and net reserve release of $0.1B in 4Q23
- Noninterest expense of $17.2B increased $1.0B, or 6%, vs. 1Q23
- Excluding FDIC special assessment, adjusted noninterest expense of $16.5B increased $0.3B, or 2%3
- Balance sheet remained strong
- Average deposits of $1.91T increased $14B, or 1%, vs. 1Q23
- Average loans and leases of $1.05T were modestly higher vs. 1Q23
- Common Equity Tier 1 capital of $197B increased $2B from 4Q23
- Common Equity Tier 1 ratio of 11.8%; 184 bps above regulatory minimum
- Average Global Liquidity Sources of $909B5
- Paid $1.9B in common dividends and repurchased $2.5B of common stock, including repurchases to offset shares awarded under equity-based compensation plans
- ROE stands for return on average common shareholders' equity. ROTCE stands for return on average tangible common shareholders' equity. FTE stands for fully taxable-equivalent basis.
2 Represent non-GAAP financial measures. For important presentation information about these measures, see slide 34.
3 Represent non-GAAP financial measures. For a reconciliation to the most directly comparable GAAP financial measures, see note A on slide 30. 1Q24 adjusted noninterest expense of $16.5B is calculated as reported noninterest expense of $17.2B, less the FDIC special assessment of $0.7B. Reported noninterest expense for 1Q23 was $16.2B. For important presentation information, see slide 34.
4 Excludes loans measured at fair value. Net charge-off ratio is calculated as annualized net charge-offs divided by average outstanding loans and leases during the period. | 4 |
5 See note D on slide 31 for definition of Global Liquidity Sources. |
Balance Sheet, Liquidity, and Capital
(EOP1 basis unless noted)
Balance Sheet Metrics | 1Q24 | 4Q23 | 1Q23 | |||
Assets ($B) | ||||||
Total assets | $3,274 | $3,180 | $3,195 | |||
Total loans and leases | 1,049 | 1,054 | 1,046 | |||
Cash and cash equivalents | 313 | 333 | 376 | |||
Total debt securities | 910 | 871 | 797 | |||
Funding & Liquidity ($B) | ||||||
Total deposits | $1,946 | $1,924 | $1,910 | |||
Long-term debt | 296 | 302 | 284 | |||
Global Liquidity Sources (average)2 | 909 | 897 | 854 | |||
Equity ($B) | ||||||
Common shareholders' equity | $265 | $263 | $252 | |||
Common equity ratio | 8.1 | % | 8.3 | % | 7.9 | % |
Tangible common shareholders' equity3 | $195 | $193 | $182 | |||
Tangible common equity ratio3 | 6.1 | % | 6.2 | % | 5.8 | % |
Per Share Data | ||||||
Book value per common share | $33.71 | $33.34 | $31.58 | |||
Tangible book value per common share3 | 24.79 | 24.46 | 22.78 | |||
Common shares outstanding (in billions) | 7.87 | 7.90 | 7.97 | |||
Basel 3 Capital ($B)4 | 1Q24 | 4Q23 | 1Q23 | |||
Common equity tier 1 capital | $197 | $195 | $184 | |||
Standardized approach | ||||||
Risk-weighted assets (RWA) | $1,660 | $1,651 | $1,622 | |||
CET1 ratio | 11.8 | % | 11.8 | % | 11.4 | % |
Advanced approaches | ||||||
Risk-weighted assets | $1,470 | $1,459 | $1,427 | |||
CET1 ratio | 13.4 | % | 13.4 | % | 12.9 | % |
Supplementary leverage | ||||||
Supplementary Leverage Ratio | 6.0 | % | 6.1 | % | 6.0 | % |
- CET1 ratio of 11.8% increased 4 bps vs. 4Q234
- CET1 capital of $197B increased $2B from 4Q23, driven by net income, partially offset by capital distributions to shareholders
- Standardized RWA of $1,660B increased $9B from 4Q23
- Book value per share of $33.71 improved 7% from 1Q23; tangible book value per share of $24.79 improved 9% from 1Q233
- Average Global Liquidity Sources of $909B increased $12B, or 1%, from 4Q232
- EOP stands for end of period.
- See note D on slide 31 for definition of Global Liquidity Sources.
- Represent non-GAAP financial measures. For important presentation information, see slide 34.
- Regulatory capital ratios at March 31, 2024 are preliminary. Bank of America Corporation (the Corporation) reports regulatory capital ratios under both the Standardized and Advanced approaches. Capital adequacy is
evaluated against the lower of the Standardized or Advanced approaches compared to their respective regulatory capital ratio requirements. The Corporation's binding ratio was the Total capital ratio under the | 5 |
Standardized approach for March 31, 2024 and December 31, 2023, and the CET1 ratio under the Standardized approach for March 31, 2023. |
Average Loan and Lease Trends
Total Loans and Leases ($B)
$1,100
$1,041 | $1,047 | $1,046 | $1,051 | $1,048 | YoY |
+1% |
$1,000
$900
$800
1Q23 2Q23 3Q23 4Q23 1Q24
Loans and Leases in Business Segments ($B)
$1,250 | $1,031 | $1,037 | $1,037 | $1,041 | $1,039 | YoY | |
+1% | |||||||
$1,000 | |||||||
125 | 129 | 131 | 134 | 134 | +7% | ||
$750 | 381 | 383 | 376 | 375 | 374 | (2%) | |
$500 | 221 | 219 | 219 | 219 | 219 | (1%) | |
$250 | 304 | 307 | 311 | 313 | 313 | +3% | |
$0 | |||||||
1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | |||
Consumer Banking GWIM Global Banking Global Markets
Note: Amounts may not total due to rounding.
Total Loans and Leases by Portfolio ($B)
$750 | |||||
$588 | $593 | $589 | $592 | $591 | |
$500 | $453 | $454 | $457 | $459 | $456 |
$250
$0
1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | |
Consumer | Commercial | ||||
Total Loans and Leases in All Other ($B)
$15
$10 | $10 | $9 | $9 | $9 | YoY | ||||
$10 | |||||||||
(12%) | |||||||||
2 | 2 | 2 | 2 | 2 | |||||
$5 | |||||||||
8 | 8 | 8 | 8 | 7 | |||||
$0 | |||||||||
1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | |||||
Residential mortgage | Home equity | ||||||||
6
Average Deposit Trends
Bank of America Ranked #1 in U.S. Retail Deposit Market Share1
Total Corporation ($B) | Consumer Banking ($B) | |||||||||||||||||||||||||
$2,250 | $1,894 | $1,875 | $1,876 | $1,905 | $1,907 | QoQ | vs. 4Q19 | $1,250 | $1,026 | $1,006 | ||||||||||||||||
0% | +35% | $1,000 | $980 | $959 | $952 | QoQ | vs. 4Q19 | |||||||||||||||||||
(1%) | +32% | |||||||||||||||||||||||||
543 | 521 | |||||||||||||||||||||||||
$1,500 | $1,410 | 630 | 597 | 565 | (4%) | +27% | $720 | |||||||||||||||||||
$750 | 525 | 517 | 498 | 482 | 473 | (2%) | +38% | |||||||||||||||||||
409 | ||||||||||||||||||||||||||
$500 | 343 | |||||||||||||||||||||||||
$750 | ||||||||||||||||||||||||||
1,264 | 1,278 | 1,311 | 1,362 | 1,387 | +2% | +38% | ||||||||||||||||||||
1,002 | $250 | 501 | 490 | |||||||||||||||||||||||
377 | 482 | 478 | 480 | 0% | +27% | |||||||||||||||||||||
$0 | $0 | |||||||||||||||||||||||||
4Q19 | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 4Q19 | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | |||||||||||||||
Interest-bearing | Noninterest-bearing | Other deposits | Core operating deposits2 | |||||||||||||||||||||||
GWIM ($B) | Global Banking ($B) |
$400
$300
$200
$100
$0
$314 | $295 | $292 | $292 | $297 | QoQ | vs. 4Q19 | $600 | |
$256 | +2% | +16% | ||||||
90 | 76 | 69 | 65 | 65 | 0% | (27%) | $400 | |
88 | ||||||||
224 | 219 | 223 | 228 | 233 | +2% | +39% | $200 | |
167 | ||||||||
$0 | ||||||||
$504 | $528 | $526 | QoQ | vs. 4Q19 | |||
$493 | $498 | 0% | +39% | ||||
$379 | 208 | 189 | 177 | 164 | (7%) | (3%) | |
236 | |||||||
169 | |||||||
257 | 289 | 315 | 351 | 362 | +3% | +73% | |
209 | |||||||
4Q19 | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 4Q19 | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 |
Bank deposits3 | Sweep deposits | Interest-bearing | Noninterest-bearing | ||||||||
Note: Amounts may not total due to rounding. Total Corporation also includes Global Markets and All Other.
- Estimated U.S. retail deposits based on June 30, 2023 FDIC deposit data.
-
Core operating deposits include Consumer and Small Business checking products and exclude consumer investments, which are included in other deposits.
3 Includes Preferred Deposits, other non-sweep Merrill bank deposits, and Private Bank deposits.
7
Managing Excess Deposits
Deposits in Excess of Loans (EOP, $B) | Cash and Securities Portfolios ($B)1 | |||||||||||
$2.5T | $1,331 | $1,205$1,223 | ||||||||||
348 | 333 313 | |||||||||||
$1,085B | $897B | $634 | 308 | |||||||||
277 323 | ||||||||||||
$451B | 162 | |||||||||||
256 | 675 | 595 587 | ||||||||||
$0.5T | 216 | |||||||||||
4Q21 | ||||||||||||
4Q19 | 4Q21 | 1Q24 | 4Q19 | 1Q24 |
Deposits Loans
Deposits in excess of loans | HTM securities | AFS & other securities | Cash & cash equivalents |
Cash & Securities Yield vs. Deposit Rate Paid
- Deposits in excess of loans grew from $0.5T in 4Q19 and peaked at $1.1T in 4Q21; remained elevated at $0.9T in 1Q24
4.00% | 3.60% |
3.00%
1.93%
2.00%
1.00%
0.00% | |||||||
4Q21 | |||||||
4Q19 | 1Q24 | ||||||
Cash & securities yield 3 | Total deposit rate paid | ||||||
- Excess deposits stored in cash and investment securities
- 52% cash and AFS and 48% HTM in 1Q24
- Cash levels of $313B remained well above pre-pandemic ($162B in 4Q19)
- AFS securities mostly hedged with floating rate swaps; duration less than 0.5 years and marked through AOCI1 and regulatory capital
- HTM securities book has declined $96B since peaking at $683B in 3Q21; down $38B vs. 1Q23 and $8B vs. 4Q23
- MBS1 of $458B down $8B, and U.S. Treasuries and other securities of $129B flat vs. 4Q23
- Valuation2 declined $11B from 4Q23, driven primarily by higher mortgage interest rates
- Blended cash and securities yield continued to improve in 1Q24 and is 168 bps above deposit rate paid
Note: Amounts may not total due to rounding.
-
HTM stands for held-to-maturity. AFS stands for available-for-sale. AOCI stands for accumulated other comprehensive income. MBS stands for mortgage-backed securities.
2 HTM valuation represents pretax net unrealized gains (losses) on total held-to-maturity debt securities.
3 Yields based on average balances. Yield on cash represents yield on interest-bearing deposits with the Federal Reserve, non-U.S. central banks, and other banks.
8
Net Interest Income
Net Interest Income (FTE, $B)1
$15.0 $14.6 $14.3 $14.5 $14.1 $14.2
$10.0
$14.4 | $14.2 | $14.4 | $13.9 | $14.0 |
$5.0
$0.0
1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | |
Net interest income (GAAP) | FTE adjustment | ||||
- Net interest income of $14.0B ($14.2B FTE)1 decreased $0.4B YoY, as higher deposit costs more than offset higher asset yields, higher NII related to Global Markets (GM) activity, and modest loan growth
- Increased $0.1B from 4Q23, driven primarily by higher asset yields and NII related to GM activity, partially offset by higher deposit costs and one fewer day of interest accrual
- NII related to GM activity increased approximately $0.6B YoY and $0.1B from 4Q23
- Net interest yield of 1.99% decreased 21 bps YoY and increased 2 bps from 4Q23
- Excluding GM, net interest yield of 2.50%1
- As of March 31, 2024, a +100 bps parallel shift above the interest rate yield curve was estimated to benefit NII by $3.0B over the next 12 months; a -100bps parallel shift was estimated to decrease NII by $2.9B2
Net Interest Yield (FTE)1 | Net Interest Income excl. GM (FTE, $B)1 |
4.00% | $15.0 |
3.00% | 2.85% | 2.65% | 2.64% | $10.0 | ||||
2.47% | 2.50% | |||||||
2.00% | 2.20% | 2.06% | 2.11% | 1.97% | 1.99% | $5.0 | ||
1.00% | $0.0 | |||||||
1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | ||||
Reported net interest yield | Net interest yield excl. GM | |||||||
$14.6 $14.3 $14.5 $14.1 $14.2
$14.5 $14.0 $13.9 $13.5 $13.5
1Q23 2Q23 3Q23 4Q23 1Q24
NII excl. GM | GM NII |
Note: Amounts may not total due to rounding. FTE stands for fully taxable-equivalent basis.
- Represent non-GAAP financial measures. Net interest yield adjusted to exclude Global Markets NII of $0.7B, $0.6B, $0.7B, $0.3B, and $0.1B and average earning assets of $692.9B, $667.1B, $656.0B, $657.9B, and
$627.9B for 1Q24, 4Q23, 3Q23, 2Q23, and 1Q23, respectively. The Corporation believes the presentation of NII and net interest yield excluding Global Markets provides investors with transparency of NII and net | |
interest yield in core banking activities. For important presentation information, see slide 34. | 9 |
2 NII asset sensitivity represents banking book positions. See note E on slide 31 for information on asset sensitivity assumptions. |
Expense and Efficiency
Total Noninterest Expense ($B)
$20.0
$10.0
$0.0
$16.2 | $16.0 | $15.8 | $17.7 | $17.2 | |||||
2.1 | 0.7 | ||||||||
6.3 | 6.6 | 6.3 | 6.1 | 6.3 | |||||
$15.61 | $16.51 | ||||||||
9.9 | 9.4 | 9.6 | 9.5 | 10.2 | |||||
1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | |||||
Compensation and benefits | Other | FDIC special assessment | |||||||
Efficiency Ratio
70%
65%
60%
55%
66% | |
64% | 64% |
62% | 63% |
1Q23 | 2Q23 | 3Q23 | 4Q231 | 1Q241 |
- 1Q24 and 4Q23 noninterest expense of $17.2B and $17.7B included accruals of $0.7B and $2.1B for the estimated amount of the FDIC special assessment for uninsured deposits of certain failed banks
- Excluding the FDIC special assessment, 1Q24 adjusted noninterest expense of $16.5B increased $0.3B, or 2%,1 vs. 1Q23, driven primarily by investments in people, including revenue-related incentives
- 1Q24 adjusted noninterest expense increased $0.9B, or 6%, vs. adjusted 4Q23,1 driven by seasonally elevated payroll taxes, revenue- related expenses, and other annual awards and merit
Note: Amounts may not total due to rounding.
- Represent non-GAAP financial measures. 1Q24 adjusted noninterest expense of $16.5B is calculated as reported noninterest expense of $17.2B less the FDIC special assessment accrual of $0.7B. 4Q23 adjusted
noninterest expense of $15.6B is calculated as reported noninterest expense of $17.7B, less the FDIC special assessment accrual of $2.1B. 1Q24 efficiency ratio adjusted to exclude the FDIC special assessment accrual, which increased the reported efficiency ratio of 67% by 271 bps. 4Q23 efficiency ratio adjusted to exclude the net pretax charge of $1.6B recorded in noninterest income related to the future cessation of
the Bloomberg Short-term Bank Yield Index, as well as the $2.1B pretax noninterest expense for the FDIC special assessment accrual, resulting in a combined increase of 1,430 bps in the reported efficiency ratio of 10 81%. For more information and a reconciliation to the most directly comparable GAAP financial measures, see note A on slide 30. For important presentation information about this measure, see slide 34.
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Bank of America Corporation published this content on 16 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 16 April 2024 10:46:01 UTC.