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Bank of America: First Quarter 2022 Results Presentation

Bank of America 1Q22 financial results

April 18, 2022

1Q22 Highlights

(Comparison with 1Q21, unless otherwise stated)

  • • Net income of $7.1 billion; diluted earnings per share of $0.80; ROE 11.0%, ROTCE1 15.5%

  • • Revenue, net of interest expense, of $23.2 billion, up $0.4 billion, or 2%

    • – Net interest income (NII) of $11.6 billion ($11.7 billion FTE1) increased $1.4 billion, or 13%, driven by strong deposit growth and related investment of excess liquidity, loan growth and lower premium amortization expense, partially offset by lower Paycheck Protection Program (PPP) fees

    • – Non-interest revenue of $11.7 billion decreased $1.0 billion, or 8%, due to lower investment banking fees, which outpaced lower expense groups Of the industry2partially offset by higher asset management fees

  • • Provision for credit losses of $30 million included a net reserve release of $362 million, primarily due to improved asset quality, offset by reserve build-up related to Russia exposure and loan growth3

    – Net Charges (NCO) remained relatively stable compared to 4Q21, but decreased by 52% compared to 1Q21; the net charge-off ratio of 16 basis points remained close to all-time lows

  • • Non-interest expense of $15.3 billion decreased $0.2 billion, or 1% – Generated operating leverage4 for the third consecutive quarter (305 basis points in 1Q22)

  • • Expanded balance sheet and remains strong

    • – Deposits increased $8 billion from 4Q21

    • – Loans and leases increased $14 billion from 4Q21

    • – CET1 ratio of 10.4% (9.5% minimum); average global sources of liquidity5 increased to $1.1T

    • – Repurchase of $2.6 billion of common stock, including repurchases to offset shares awarded under stock-based compensation plans

    • – Paid $1.7 billion in ordinary dividends

  • • No significant direct exposure to Russia – Approximately $700 million in loans and counterparty exposure, substantially all of which are loans – All loans have been downgraded and flagged as subject to bookable with increased provision coverage at 1T22

Note: ETP stands for Total Tax Equivalence Basis.

  • 1 Represents a non-GAAP financial measure. For important information on the presentation of this measure, see slide 33.

  • 2 Dealogic as of April 1, 2022.

3 For more information on creating reserve (version), see no tea on the slide 30.

  • 4 Operating leverage is calculated as the year-over-year percentage change in revenue, net of interest expense, less the percentage change in non-interest expense.

  • 5 See note B on slide 30 for the definition of global sources of liquidity.

Consumer spending remained strong; 1Q22 at $980 billion, up 14% YoY

Payment expenses1 ($ volume) and % year-on-year growth

$980 billion

1Q19

1T20

1Q22 Payment Spend ($ volume)

Credit

Debit

ACH

Son

P2P/P2B4

Species

To verify

Note: Amounts may not total due to rounding.

1Q22 credit and debit spending2.3 ($ volume) Growth

vs. 1Q19

75% 50% 25% 0%

1T21

% of 1Q22 credit/debit spend

Annual change in payment transaction volume in 1Q22

% of 1Q22 totalI

  • 1 Total payments include total payments by credit card, debit card, ACH, wire transfers, billing, person-to-person (P2P), cash, and checks.

  • 2 Includes personal and small business credit card wallets in Consumer Banking and GWIM.

    Travel and entertainment

    debit credit 75%ACH/Wire 11%P2P/P2B4 8%

    cash check 6%

  • 3 Excludes credit and debit money transfers, charitable donations and miscellaneous categories with intangible volume.

  • 4 P2B stands for person-to-business.

57%

12%

vs. 1T21

48%42%

GasFood

6%

Retail

23%

32%

14%

Services

27%

(4)%

Daily trends in loan and lease balances ($B)

Total loans and leases ex. PPP1

Loans and leases in business sectors ex. PPP1

$600 $550 $500 $450 $400 $350

CommercialConsumer

31/12/19 31/03/22

Credit card2

Residential mortgage2

$100

$225

$90

$80

$70 12/31/19

$220 $215 $210 $205 $200 $195

03/31/22

31/12/19 31/03/22

  • 1 Excludes P3 related balances (recorded in Commercial) of $3.0B, $4.7B, $8.4B, $15.7B and $21.1B for 1Q22, 4Q21, 3Q21, 2Q21 and 1T21, respectively. Total loans and leases at the end of the period were $993.1 billion,

    $979.1 billion, $927.7 billion, $918.9 billion, and $903.1 billion for 1Q22, 4Q21, 3Q21, 2Q21, and 1Q21, respectively. End-of-period commercial loans and leases were $554.3 billion, $543.4 billion, $504.3 billion, $500.8 billion and $490.9 billion for 1Q22, on 4Q21,

    3T21, 2T21 and 1T21, respectively. Excluding period-end PPP loan balances, total loans and leases were $990.2 billion and $974.4 billion for 1Q22 and 4Q21, and commercial loan balances were $990.2 billion. $551.3 billion and $538.7 billion. Total loans and leases increased by $14.0 billion and, excluding PPP loan balances, increased by $15.7 billion, quarter over quarter. Total commercial loans and leases increased by $10.9 billion and, excluding PPP loan balances, increased

    $12.6 billion, quarter over quarter. Loans data exclude loans held for sale.

  • 2 Credit cards and residential mortgages include only balances recorded in Consumer Banking and GWIM, and exclude loans held for sale.

Consumer resilience

Change of BofA credit card customer1 Sales since 1Q20

BofA Credit Card 5-29 and 30+ Day Late Rates

39%

39%

30+ days5-29 days

2.50%

Postponement peak

2.00%

(8%)

(12%)

1.50%Avg. Credit card balanceAvg. To pay

Balance

Avg. Credit card balance (<680 FICO)

Avg. To pay

Balance (<680 FICO)

1.00%

4T19 1T20 2T20 3T20 4T20 1T21 2T21 3T21 4T21 1T22

U.S. Household Check and Currency Deposits ($B)2

US Household Debt Service Payments as % of Personal Disposable Income3

$4,000

$3,000

$2,000

$1,000

$0

15%

13%

ten%

8%

March- June- Sept- Dec- March- June- Sept- Dec- March- June- Sept- Dec 19 19 19 20 20 20 20 21 21 21 21

5% 1991

1996

2001

2006

2011

2016

2021

  • 1 Includes consumer customers who have a primary deposit account with the bank and who also have a BAC credit card. Consumer checking accounts are deemed to be the customer’s primary account based on several relationship factors (eg, related to their direct deposit).

  • 2 Z.1 Financial Accounts of the United States release, The Federal Reserve Board.

  • 3 Publication of Household Debt Service and Financial Obligation Ratios, The Federal Reserve Board.

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Bank of America Corporation published this content on April 18, 2022 and is solely responsible for the information contained therein. Distributed by Audienceunedited and unmodified, on Apr 18, 2022 10:53:01 AM UTC.

Public now 2022

All the latest from BANK OF AMERICA CORPORATION

BANK OF AMERICA CORPORATION Analyst Recommendations

2022 sales 94,736M

Net income 2022 26,645 million

Net debt 2022

PER 2022 ratio 11.4x
2022 return 2.39%
Capitalization 303B
303B
Cap. / Sales 2022 3.20x
Cap. / Sales 2023 2.97x
# of employees 208,000
Floating 99.8%

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Tendencies Bearish Bearish Bearish

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Medium consensus SURPASS
Number of analysts 26
Last closing price $37.57
Average target price $49.98
Average Spread / Target 33.0%

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