BAC 2020 Annual Report

Coming together
in new ways
Annual Report 2020

CONTENTS
1 A letter from Chairman and CEO 21 A message from Bernie Mensah: 29 Supporting emotional wellness
Brian Moynihan Making significant progress and mental health
internationally
10 Measuring stakeholder capitalism 30 Continuing to be a workplace where
22 Delivering innovative wealth all teammates can grow and thrive
11 A message from outgoing solutions and exceptional client
Lead Independent Director service 32 Being a great place to work —
Jack Bovender 2020 highlights
23 What sets us apart:
11 A message from incoming 33 Investing $1 billion over four years
BofA Global Research
Lead Independent Director to advance racial equality and
Lionel Nowell 24 Serving our clients and communities economic opportunity
through technology
14 Addressing a global health crisis 34 A conversation with Anne Finucane
as one company 25 Market Presidents deliver our and Karen Fang: Addressing
global company to each client, the world’s challenges through
18 Q&A with D. Steve Boland and sustainable finance
employee and community
Aron Levine: Working together to
meet clients’ changing needs in a 26 A message from Sheri Bronstein: 36 2020 ESG highlights
challenging year Being a great place for our
teammates to work 38 Financial highlights
19 Growth of digital banking, lending
and investing at Bank of America 28 Driving meaningful change when 39 Recognition
the world needs it most 40 Stakeholder Capitalism Metrics
20 Q&A with Matthew Koder:
Delivering for our clients with
defining differentiators
A letter from Chairman and CEO Brian Moynihan
To our shareholders and clients,
To my teammates,
To leaders and partners in the communities
we serve across the U.S. and around the world,
I hope this finds you safe and well.

It is my pleasure to share with you the 2020 Bank of outgoing Lead Independent Director, Jack Bovender,
America Annual Report. Our report documents how for all he has done for our company and those we
your company responded to the impacts — both serve. As we announced in September 2020, Lionel
humanitarian and financial — of the global health Nowell III takes over this important role. Lionel is an
crisis. It describes how we responded to the social experienced leader and has been a valued member
and racial justice issues that moved to the forefront of our Board for the past eight years. Jack and
in 2020. The pages also tell the story of how our Lionel share their perspectives on the past
company came together in new ways to deliver year, and what lies ahead, on page 11.
for our shareholders, our teammates, our clients,
our communities and to help address society’s Looking at our 2020 results, one thing is clear:
biggest challenges. Our decade-long focus on Responsible Growth
prepared us well for this crisis. It allowed us to be
I begin this letter by thanking my 213,000 a source of stability for our customers and clients
teammates and our senior management team. during challenging times, to continue supporting the
I thank them for their extraordinary efforts over communities in which we work and live and deliver
the past 12 months, and for everything they do to more consistent results for our shareholders through
support our clients, and each other, every day. a well-understood risk framework. You can see the
impact of Responsible Growth in the chart below.
I would also like to thank our Board of Directors for
their leadership and guidance throughout 2020. In Despite the impacts of the global health crisis,
particular, I would like to extend my gratitude to our which resulted in a historically low interest rate
2010 to 2014: Dramatic 2015 to 2020: Net income

net income volatility reflecting Responsible Growth¹
(billions) (billions)
$5.5
Quarterly net income
$3.2
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
¹ 4Q 2017 net income of $5.3B represents a non-GAAP financial measure. GAAP net income of $2.4B excludes $2.9B related to the
adoption of the Tax Cuts and Jobs Act.
BANK OF AMERICA 2020 | 1

environment and a period of market volatility, your company
earned $17.9 billion in net income, or $1.87 per share.
Moreover, we ended 2020 with more capital, more deposits,
record liquidity and improved capital ratios. We did this while
5-year stock performance
increasing support for our clients.
In March of 2020, the stock price for banks in general saw

a sharp drop as the health crisis unfolded and investors
contemplated potentially large credit losses and revenue
declines from interest rates and a paucity of economic activity.
80.1%
From those lows, bank stocks made a steady recovery as
fears moderated, ending the year modestly down from the
start of the year.
Our stock price declined 49% in March from the beginning

45.8%
of 2020 and then saw a 68% recovery, ending the year down
14%. This was in line with the broader bank index but below 34.0%
the broader market rise of 16%. Despite the 2020 decline,
our stock price has outperformed the broader bank index on a
3-year and 5-year basis. As we prepare to issue this report in
late February 2021, the price is up 14% this year, reflecting the
improved economic outlook. BAC BKX U.S. LC
Index1 Peers2
During 2020, we delivered $12 billion in capital back to
shareholders through dividends and net share repurchases. We
did this even as we halted share repurchases late in the first
quarter of 2020 in line with additional federal bank regulatory
restrictions. We have resumed share repurchases in the first
quarter of 2021 from a position of strength with $36 billion of
capital above our minimum regulatory requirements.
Our results in 2020 built onto a solid foundation established 5-year total shareholder return
by focusing on Responsible Growth for the past decade. We
have a strong balance sheet, a best-in-class suite of products
and capabilities — including our industry-leading digital
98.7%
capabilities — and a global team of dedicated professionals
that is second to none. We are well-positioned to continue
delivering for our shareholders, and all those we serve, in
2021 and beyond.
64.7%
We believe we must continue to deliver these strong results
and help make progress on important societal priorities. That is 53.1%
core to how we run our business and drive Responsible Growth.
In 2020, we also continued to make meaningful progress

on important issues that affect us all. During the year, we
accelerated our longstanding work to promote racial equality
and economic opportunity, with a $1 billion, four-year
commitment aimed at supporting jobs, healthcare, housing
and businesses. While we were pleased to see commitments BAC BKX U.S. LC
Index1 Peers2
being made by other companies and organizations, we
have moved quickly to get money moving to our priority
areas of focus. So far, we have invested in jobs and skills
training at 11 historically Black colleges and universities and
11 community colleges. We have delivered over 20 million
masks and other personal protective equipment (PPE) to 1
The BKX Index consists of 24 stocks selected from the
largest U.S. regional and nationwide banking companies.
2
Total shareholder return includes stock price appreciation and dividends
paid. U.S. Large Cap (LC) Peers include JPM, C, WFC, GS and MS.
2 | BANK OF AMERICA 2020

Brian Moynihan
Chairman and CEO
community partners, nonprofits, and other venues. We have

invested in 14 Minority Depository Institutions (MDIs) to help
Responsible Growth
There are four pillars to Responsible Growth.
them grow and serve their communities. We have increased
our overall commitment to Community Development
• We must grow in the market, no excuses.
Financial Institutions (CDFIs) to $1.7 billion — making Bank
of America the largest private sector CDFI funder. And, we • We must grow with a customer focus.
have agreed to invest in 61 minority-owned or -focused • We must grow within our risk framework.
venture capital or private equity funds in communities around • We must grow in a sustainable manner.
the U.S., which will deliver more equity into thousands of
minority-owned small businesses. You can find out more I’ll discuss each of these in turn, and the ways our team in 2020
about our commitment to racial equality and economic delivered on these pillars.
opportunity on page 33.
Grow in the market, no excuses
We also continued to support the transition to a low-carbon, What could we do in an economy to help our clients and grow?
sustainable economy, through our operations, our business
activities and our partnerships. This includes our commitment We supported our clients in lockdown with our various customer
to a goal of achieving net-zero carbon emissions by 2050. assistance programs. We supported small businesses with
Paycheck Protection Program (PPP) loans. We supported wealth
management clients with advice, expertise and execution in

volatile markets. We supported commercial clients with our All of this, and more, allowed us to continue to serve clients
strong balance sheet that provided more than $70 billion in loans relatively uninterrupted by the pandemic, even as volumes
in a few-week period, and raised $772 billion in capital over the surged. We played our part, with our industry colleagues, in
course of the year. For institutional investors, it meant having the helping ensure economies around the world, and here in the
market expertise and insights, trading capabilities and access to U.S., recover more quickly. In the end, that is the role of the
enable them to navigate through. bank. Your company executed that role well.
But we believe it was our planning and investments over the And we grew.
past decade that made this all work. We supplied needed capital
and liquidity to borrowers. Our investments in digital client In 2020, average deposits increased 18% year-over-year to
interfaces across our client groups allowed us to maintain a approximately $1.6 trillion. In Consumer Banking, we added
close relationship with our clients, as they moved seamlessly to $115 billion in average deposits during the year, cementing
digital check deposits, payments, banking and investing. On the our position as the #1 bank in the U.S. by retail deposits.
commercial side, we had invested in our CashPro application, We leveraged our leading digital capabilities to serve our
which allowed our clients to safely and securely move billions consumer clients how, when and where they chose to bank
of dollars every day. We used automated signature capabilities with us. Across all consumer sales in 2020, 42% of sales
to allow clients to complete estate plans, borrow or invest — all came through digital channels.
with the same security as doing it in person. With institutional
investors, we moved quickly to supply liquidity and a strong and During the year, we also enrolled more than one million clients
resilient platform to support their activities and help assure into our flagship loyalty program, Preferred Rewards, driving
stability of the financial system. total membership to 7.2 million. Preferred Rewards recognizes
Revenue¹,² FY2020 Net income³ FY2020

(billions) (billions)
Global Markets Consumer Global Markets Consumer

$18.8 $33.3 $5.2 $6.5
$85.5B $17.9B
Global Banking GWIM Global Banking GWIM

$19.0 $18.6 $3.5 $3.1
Note: Amounts may not total due to rounding.

¹ Business segment results are reported on a fully taxable-equivalent (FTE) basis with remaining operations recorded in All Other with revenue of ($3.6B).
² Total revenue, net of interest expense, on a GAAP basis is $85.5B and $86.0B on an FTE basis, a non-GAAP financial measure. The FTE adjustment is $499M.
³ Net Income of $17.9B includes a net loss of $407M in All Other.

and rewards clients for their entire relationship with us, and we Investor—placing as one of the top two firms for each of the
continue to see 99% retention rates from our members. past 10 years. You can read more about our award-winning
research capabilities on page 23.
We brought our top retail bank brand to new markets in
the U.S., including markets in Ohio and Utah, while building Each of our businesses contributed to our results, and the
our presence in existing markets. According to our internal diversity of our offerings served us well through a dynamic market
research, we continued to gain share in key markets. In 25 of environment. It will continue to serve us well as we look forward.
the top 30 markets across America — representing over half of
the U.S. population — we now hold the #1, #2 or #3 position. Grow by focusing on our clients
That is twice as many markets as our closest peer and includes Last year, thanks to the commitment of our teammates, the
14 markets in which we hold the #1 position. strength of our platform and our focus on Responsible Growth,
we achieved the highest client satisfaction scores in company
During the year, our wealth management team found new history. That is a credit to each and every member of our global
ways to connect with, and deliver for, our Merrill and Private team, who work hard to serve our customers and clients — and
Bank clients. On page 22, we take a closer look at how exceed their expectations — in every interaction.
our advisors continued to support clients and helped
them navigate a changing environment. We added In 2020, that included far-ranging measures to support those
roughly 22,000 Merrill and 1,800 Private Bank relationships impacted by the health crisis, through our own relief programs
in 2020, and ended the year with client balances at all-time and those provided by the federal government. We processed
highs of $3.3 trillion. approximately 2 million payment deferral requests as part
of our Client Assistance Program. We processed more than
For the companies we serve, we begin with our small business 16 million Economic Impact Payments (EIP), totaling more than
clients. Apart from the role we played as the largest lender $26 billion in the initial round of U.S. government stimulus
in the federal government’s PPP by number of loans, we also payments — and continued processing additional payments
continued as the largest small business lender in the country following subsequent relief legislation.
overall, ending the year with more than $32 billion in small
business loan balances. We also deployed our new merchant As the largest PPP lender by number of PPP loans in the first
services capabilities. three rounds of the program, in 2020 we helped more than
343,000 small business clients — in every industry, every
For our commercial clients, the year was difficult as they had market — receive PPP loans, delivering more than $25 billion
to absorb massive changes to the business cycle brought by in PPP loan funds to businesses in need. We began accepting
the health crisis. We were there for them. Early in the year, applications for PPP loans once again in January 2021, in
we supported their borrowing rush as they sought liquidity in line with a new round of federal PPP lending. Once again, we
February, March and April. As conditions stabilized, we helped are among the top lenders in the program.
with market access for them to raise needed and permanent
capital. We continued to bring digital capabilities to ensure At the same time, we remained focused on supporting the
their businesses could run smoothly, even in a work-from-home everyday financial needs of millions of clients. With additional
environment. The results for us were a surge in loans to these health and safety measures in place, our teams continued to
businesses. We peaked at $585 billion in commercial loans; by serve individuals and businesses across our nationwide network
year-end those were down to $499 billion. of approximately 4,300 financial centers and 17,000 ATMs. I’d
like to offer a special thanks to my teammates in the financial
Our investment banking team recorded $7 billion in total centers who have played an essential role for our clients and
investment banking fees and posted three of the strongest communities through this health crisis.
investment banking quarters in our history. Our performance
in this business helped us gain market share and retain the Not surprisingly, we also saw a growing number of clients
#3 market position, thanks to the efforts of our talented choose to connect with us digitally during 2020. Our ten-plus
team. Matthew Koder, President of Global Corporate years of sustained investment into technology — such as
& Investment Banking, looks back on his team’s
accomplishments on page 20.
In Global Markets, full-year sales and trading revenue for 2020

increased 18% year-over-year to $15 billion. During the year
39.3M
digital customers
we continued to push our innovative capabilities in electronic
at year-end, up 3% over 2019
trading forward to help win mindshare with some of our largest
clients. At the same time, our own research team was again
ranked as one of the top Global Research Firms by Institutional

artificial intelligence (AI) — and our award-winning digital Digital connectivity was also fundamental to our success in
platforms ensured we could continue to serve our clients when wealth management, and we saw digital engagement for
they needed us most. wealth management clients climb to record levels. By the
end of 2020, 77% of Merrill Lynch households and Private
In Consumer Banking, we ended 2020 with 39.3 million digital Bank clients were using online or mobile banking. Our
customers, up 3% over 2019. They connected with us nearly digital platforms also allowed for effective advisor-client
11 billion times. Our roughly 13 million active Zelle® users, both communications, which became a critical part of relationship
consumers and small businesses, sent approximately $141 billion building as the pandemic continued.
in transfers in 2020. To put that into perspective, that’s almost
50% of the payments made by our 38 million consumers In Global Banking, our CashPro® platform helped more CFOs
and small businesses using their credit cards. and other business leaders efficiently and securely manage
their cash flow from their offices and homes—and on their
More than 17 million of our digital banking clients use Erica®, mobile devices. Our roughly 500,000 CashPro users drove a
our AI-based virtual financial assistant, to do everything from 40% increase in platform sign-ins in 2020. Here, too, we
checking their balances to paying their bills. Erica will also applied the power of AI for our clients, digitally matching
reach out to help if, for example, a client’s balance is at risk 19 million incoming receivables in a 12-month period using
of going below $0 in the next week, or if a merchant charges our Intelligent Receivables® solution.
them twice. Erica continues to gain knowledge and evolve in
response to client needs. For example, at the beginning of Stepping back, what we saw in 2020 was the impact of years
the health crisis, Erica learned 60,000 new pandemic-related of investment in capabilities and digital access across our
intents in a matter of days. In 2020 alone, Erica completed platform and our businesses. And what was unique is that even
135 million client requests. in areas where we had heretofore experienced customers or
employees traditionally preferring to operate in a face-to-face,
In September, we launched LifePlan®, which gives clients the physical world, we saw dramatic changes. We had a record
power to select what’s most important to them and receive year in new $10 million or higher relationships in Global Wealth
personalized insights — through both high-tech and high-touch & Investment Management (GWIM), yet we were unable to
interactions — to help them achieve their financial needs and have many face-to-face meetings. We had a record year in
goals. By the end of 2020, our clients had created more than investment banking fees, yet all of our “pitch” meetings with
2 million plans, one of the fastest product rollouts in our history. clients were virtual. We saw record movement in money by our
consumer customers yet we had up to 30% of our financial
Our digital platforms also allow us to extend further into our centers closed for safety. The implications for the long term are
communities, allowing millions of clients to access services and yet to be borne out. But we are confident that the investments
connect into the broader economy. In 2020, we added Balance we have made set us on the correct course.
Assist™, a low-cost, digital-only alternative to payday-type
loans. Balance Assist, which allows clients to borrow up to I want to call out our technology and operations team, who
$500 for a $5 flat fee, joins our existing suite of safe banking showed creativity and excellence in execution by positioning all
solutions, including SafeBalance™ and Secured Card. D. Steve of our client-facing teammates to be able to operate in a work-
Boland, President of Retail, joins Aron Levine, President from-home environment. In four weeks, our tech and ops team
of Preferred and Consumer Banking & Investments, to deployed 100,000 computers and screens to those teammates. It
discuss how these products can help provide financial was no small task, and it enabled us to continue to serve clients
freedom and stability for clients on page 18. who themselves were adjusting to the pandemic conditions.
Grow within our risk framework

Growing within our established risk framework is integral to how
$1B
we drive Responsible Growth. Our principled approach to risk
management allowed us to continue supporting our customers
and clients against the backdrop of one of the worst economic
In 2020, our team generated declines in U.S. history, driven by the global pandemic.
more than 1,700 ideas to
drive operational excellence, At the onset on the health crisis, we took immediate action to
saving the company nearly strengthen our reserves for credit losses. We ended 2020 with
$1 billion. nearly $21 billion in credit reserves, more than twice what we
had at the end of 2019. Together with our existing capital, we
have substantial reserves available to manage potential losses.
Credit losses were much lower than many expected, but we
were confident our underwriting would hold up, and it did. In
fact, our actual charge-offs moved from $3.6 billion in 2019 to
$4.1 billion in 2020, a slight increase.
On the markets side, our team led by Tom Montag and Jim It’s important to note we made investments like these
DeMare navigated the markets very well and we had a strong in 2020 — and many more described throughout this
year of trading revenue. More importantly, we provided support report — while at the same time returning $12 billion in
for our institutional clients. And we had only a handful of days net capital to our shareholders. And — as you will see
with trading losses. discussed elsewhere in this report — we invested in our
team, including the fourth consecutive year of company-wide
We continue to actively monitor and assess the impacts — both supplemental bonuses, increasing our minimum hourly rate
direct and indirect — of the health crisis and other potential of pay for U.S. employees and keeping medical expenses down
risks through our risk management framework. And we continue for our lesser-paid teammates.
to drive out operational risk from the company through our
focus on operational excellence. Being a great place to work for our teammates
Attracting and retaining the best talent is key to driving
Grow in a sustainable manner Responsible Growth and one of our top priorities. It helps us
To drive Responsible Growth, we must ensure that our growth is manage our operations, provide the best service for our clients
sustainable. There are three complementary and interdependent and support our communities.
tenets to how we approach sustainable growth: driving
operational excellence, being the best place for teammates We strive to make Bank of America a great place to work
to work and sharing our success with our communities. for all teammates. And we fulfill this commitment by being
a diverse and inclusive workplace, attracting and developing
Driving operational excellence talent, recognizing and rewarding performance and supporting
While “operational excellence,” “organizational health,” teammates’ physical, emotional and financial wellness. On
“simplify and improve” and other terms we use may sound page 26, Sheri Bronstein, our Chief Human Resources
a little mechanical, they are instrumental to our success. Officer, shares her thoughts on our progress in 2020 and
In 2015, your company had $57 billion in expenses. In 2020, what it means for the future.
we had $55 billion, including roughly $1.5 billion in net
coronavirus-related costs. Compared with 2015, we have Our workforce must reflect the communities we serve. As
more customers and clients and more transactions — so more highlighted in our 2020 Human Capital Management Report, we
work. Yet costs are down and headcount is down. During have continued to make progress in our goal to ensure diverse
those six years, we invested about $18 billion in technology representation at all levels of our company. Fifty percent of our
initiatives, added 15% more sales teammates, opened 300 management team is diverse, and Bank of America is one of
financial centers and refurbished 2,000 more. All of these only five S&P 100 companies with six or more women on the
investments were made while costs came down. We continue Board. And over the past decade, the number of people of color
to apply the practice of operational excellence to enable us we hire in the U.S. from universities has increased by 50%.
to produce strong returns above our cost of capital while
investing back into our company and our capabilities. This
will provide powerful leverage as interest rates rise and the
economy continues to recover and grow.
1 of 5
Operational excellence is as much a mindset as it is a program. It
describes the ways in which we drive continuous improvement,
reduce operational risk and seek to find faster, simpler and more
efficient ways of working and serving our clients. Bank of America is one of
only five S&P 100 companies
This work is fueled by the ingenuity and creativity of our with six or more women
teammates, who continuously look for ways we can do things on the Board.
better. In total, we’ve approved nearly 8,600 of their ideas,
which commit to delivering billions in expense savings. In 2020
alone, our team generated more than 1,700 ideas that helped
$20
us define commitments to save nearly $1 billion. We reinvested
those savings back into our team, our capabilities, our client
experience, our communities and our shareholders.
In 2020, we raised our
For example, savings from operational excellence help fund minimum hourly rate of pay
the ongoing modernization of sites across our real estate for U.S. teammates to $20.
portfolio, including renovating our financial centers to deliver
a client-focused interior and exterior design and full support
for digital transactions.

We want our teammates to build long-term careers with Bank Sharing our success with our communities
of America. And that starts with a competitive starting wage One of the ways we ensure our growth is sustainable is by
and benefits. We moved to our minimum hourly rate of pay sharing our success with the communities in which we work
for U.S. teammates of $20 — roughly $42,000 per year — one and live. We invest significant time and money to help address
year earlier than planned. And we offer ongoing training and issues facing our local communities and society at large, and
development resources to help those teammates grow and commit all of our business activities and operations to the task.
thrive within our organization. We hire with a career mindset.
And we work to reskill our teammates. This begins with our $250 million in annual corporate
philanthropy. To this, we added another $100 million in 2020
For teammates earning lower salaries, we provide higher to increase access to food and medical supplies in local
company subsidies for medical premiums. Since 2012, there communities.
has been no increase in medical premiums for teammates
earning less than $50,000. Individual giving by my teammates, combined with matching
gifts from Bank of America, amounted to more than $65 million
To support our teammates during the health crisis, at work and in additional philanthropic support in 2020. To maximize
at home, we expanded many of our benefits and resources. the impact of each employee gift, we lowered the employee
This included additional support for mental health, free virtual matching gift minimum to $1 and doubled our match for
consultations and no-cost coronavirus testing. employee donations to 17 organizations through 2020.
As the pandemic hit, we knew our teammates were going to We also support our communities through our lending and
be under pressure at home. For most of them, home was their investing activities. In 2020, for example, we provided a record
workplace. For our 40,000 teammates with children, home was $5.87 billion in loans, tax credit equity investments and other
often a school or daycare. For many teammates with aging real estate development solutions, and deployed $3.62 billion
parents, home became an assisted living space. Our teammates in debt commitments and $2.25 billion in investments to help
needed help. We offered them $100 per day to hire that help. build strong, sustainable communities by financing affordable
More than 3 million days of care have been provided. This housing and economic development across the country.
helped our teammates immensely — they have told us. And it Between 2005 and 2020, we financed more than 215,000
also allowed them to serve our clients better. affordable housing units.
In 2020, we came together to support one another like never In May of 2020, we launched a $1 billion corporate social
before. It was a great reflection of the commitments, the bond, the first issued by a U.S. commercial bank to entirely
compassion and the people that make our company a great focus on fighting the pandemic. We followed that up with an
place to work. industry-first $2 billion equality progress sustainability bond
designed to advance racial equality, economic opportunity and
environmental sustainability.
$2B Our commitment to racial equality and economic opportunity

demonstrates the way in which we approach major societal
issues and align all of our resources to help drive progress
We issued a $2 billion equality locally. Our investments and partnerships in this work are
progress sustainability bond targeted at strategic areas in which we already are a leader:
designed to advance racial jobs, healthcare, housing and businesses. By providing
equality, economic opportunity and even sharper focus, we seek to make a lasting impact on
environmental sustainability. underserved minority entrepreneurs and communities. You
can read more about how we are executing on our
$1 billion commitment and a broader update on our work
$1B
in sustainable finance in the discussion between Vice
Chairman Anne Finucane and Global Sustainable Finance
Executive Karen Fang on pages 33–35.
We launched a $1 billion
corporate social bond, the first The most important way we shape our engagement in local
issued by a U.S. commercial communities is through our market president organization. Our
bank to entirely focus on fighting network of 90 presidents is responsible for leading an integrated
the pandemic. team to deliver for clients, teammates and the community,
serving as the chief executive for Bank of America in that
market. We talk more about how our presidents support
our clients and communities on page 25.

Driving profits and purpose investors a significant opportunity to build investment
portfolios for the long-term. And — through research and our
The principles of stakeholder capitalism are embedded in
own lived experience — we know that ESG commitments can
Responsible Growth. We deliver for our clients, our employees,
translate into a better brand, more client favorability and a
our communities and our shareholders and, at the same time,
better place for our teammates to work.
do our part to deliver progress against society’s biggest
challenges. This includes our work to support the health
There is an important discussion underway about the role
and safety of our teammates, the many ways we help the
capitalism plays in our society and the ways in which it must
communities we serve grow and prosper, our efforts to
evolve to ensure all participants in our economic system
promote racial equality and economic opportunity and our
are treated fairly and rewards are available equitably. Public
ongoing drive toward a clean energy future.
companies have an important role to play to help drive
that discussion. At Bank of America, we embrace our dual
Stakeholder capitalism is not a new concept, even if its recent
responsibility to drive both profits and purpose. And we work
focus makes it seem that way. As a financial institution,
with organizations and leaders around the world to champion
our success has always been tied to the success of the
these ideals and drive meaningful progress. We need a way to
communities and markets we serve. In recent years, business
measure that and in 2020 we made substantial progress on
organizations including the U.S. Business Roundtable, the
that front, too.
World Economic Forum and others have helped create broader
awareness of the ways that companies must think about
Measuring and delivering long-term value
delivering long-term value — for shareholders, of course, but for
To help society make progress toward important goals you
all of our other stakeholders, too.
need to know two things.
Helping address societal issues can stimulate the commitment
First, you need to understand what society’s priorities are.
of private sector capital to help drive even more progress.
And we do. The countries of the world identified those
And there’s growing evidence to back that up. As our Global
priorities in 2015, when nearly 200 countries agreed to the
Research team has found, companies that pay close attention
United Nations (U.N.) Sustainable Development Goals (SDGs).
to environmental, social and governance (ESG) priorities are
The SDGs reflect 17 categories of societal priorities that
much less likely to fail than companies that do not, giving
Total assets Total deposits

(trillions) (trillions)
$1.80
$1.80
$2.82
$2.82
$2.43
$2.43
$2.35
$2.35 $1.43
$1.43
$2.28
$2.28 $1.38
$1.38
$2.19
$2.19 $1.31
$1.31
$1.26
$1.26
2016 2017 2018

2018 2019 2020
2020 2016 2017
2017 2018
2018 2019
2019 2020
2020
$2.8T $1.8T
Measuring address equality of opportunity, affordable housing,
prosperity, access to clean water, renewable energy, and
stakeholder capitalism other priorities, with specific goals to be met. Leaders
in each country agreed these goals are the ones we
need to address to build a sustainable future and create
The International Business Council, with the opportunity and prosperity for all.
collaboration of the accounting firms Deloitte,
KPMG, PwC and EY, compiled a set of common ESG Second, you need to know how to measure progress. The
Stakeholder Capitalism Metrics disclosures. These International Business Council (IBC), which I am privileged
metrics are compiled from leading ESG standards- to chair, has compiled a set of Stakeholder Capitalism
setters, including the Task Force on Climate-related Metrics aligned to the SDGs. These metrics create a
Disclosures (TCFD), the Sustainability Accounting consistent way of measuring companies’ long-term value,
Standards Board (SASB), the Global Reporting across industries. This, in turn, helps direct investment
Initiative (GRI) and others. As discussed in CEO Brian toward high performers and align capital to progress on
Moynihan’s shareholder letter in this report, the goal the SDG and ultimately defines stakeholder capitalism. It
of the Stakeholder Capitalism Metrics is to provide also aligns capitalism’s innovation, its entrepreneurship
investors and other stakeholders a common set and its massive resources to the progress, which won’t be
of standards by which to evaluate the progress the made without the private sector.
company is making to address the societal priorities
agreed to in the SDGs. The metrics include In September, the IBC — working with the accounting
non-financial disclosures in four categories: people, firms Deloitte, EY, KPMG and PwC — released a set of
planet, prosperity and principles of governance. 21 core metrics, and 34 expanded metrics, aligned to
the themes of people, planet, prosperity and principles
Nearly 70 global companies have agreed to begin of governance. As of January 2021, Bank of America
using the Stakeholder Capitalism Metrics, and many and nearly 70 other global corporations have agreed
more are evaluating them for their own use. Bank of to implement reporting on the Stakeholder Capitalism
America is a founding member of His Royal Highness Metrics, and the coalition continues to grow. Later in
the Prince of Wales’ Sustainable Markets Initiative this Annual Report you can see our initial set of
(SMI), which seeks to harness the creativity, the Stakeholder Capitalism Metrics disclosures.
innovation and the balance sheets of businesses
around the world to help drive long-term growth in At Bank of America, we drive progress on the SDGs
a globally sustainable fashion. In December 2020, through all of our efforts and activities. We do so
under the guidance of His Holiness Pope Francis through our operations, our philanthropy, our human
and His Eminence Cardinal Peter Turkson, Bank resources practices, our client financing capabilities
of America joined an alliance of business leaders and the guidance we provide to investor clients. We
and companies around the world as part of the bring our $2.8 trillion balance sheet, our $55 billion
Vatican’s Council for Inclusive Capitalism (VCIC). expense base and the trillions of dollars we raise
Comprising companies that collectively have more each year for our clients to the task. And, critically,
than 200 million employees from over 163 countries, we commit the considerable ingenuity, innovation and
the VCIC illustrates how capitalism can take the lead passion of our team.
in creating economic growth that is fair, responsible,
trusted, dynamic and sustainable. The SMI, the VCIC, For over a decade, we have focused on driving
and similar organizations recognize the Stakeholder Responsible Growth so that we can create value for
Capitalism Metrics as an important step toward every stakeholder and for society — through every
providing the disclosures needed to measure the economic environment. Our focus on Responsible Growth
progress that private sector capitalism can help deliver positioned us well as we faced the unforeseen challenges
in addressing important societal priorities. of 2020, and positions us well as we look to the future.
We remain committed to delivering for our shareholders,
Given the cross-industry application of this set of our teammates, our clients, our communities and to
common metrics, not each standard will apply to making a positive impact on the world for years to come.
each company that is disclosing. Where a disclosure
is not provided or not linked to another Bank of On behalf of my 213,000 teammates, our management
America disclosure, we provide a brief explanation. team and the Board of Directors, I thank you for your
We share the long-term objective of other companies, support of Bank of America.
asset owners and asset managers, key government
regulators and the standards-setters themselves that
eventually there will be a single set of non-financial
ESG disclosure standards to help stakeholders
evaluate companies in the same fashion that standard
financial disclosures now permit.
Brian Moynihan
March 1, 2021
A message from outgoing
Lead Independent Director Jack Bovender
the execution of the strategy through As many of you know, I will be retiring
regular, systematic interaction with from our board at the time of the
company management. In performing annual meeting. Since becoming
our duties, we are mindful of the Lead Independent Director of
developments in the markets, the Bank of America, I have had the privilege
economy and geopolitical issues of meeting annually with many of our
that may impact the execution of shareholders. The feedback from these
the strategy. meetings has been invaluable and I
have routinely shared it with the
Our responsibility is to assess board. It has significantly shaped our
opportunities and risks and determine approach to fulfilling our governance
Dear shareholders: how well the company is adhering to responsibilities. For more detailed
the tenets of Responsible Growth that information, please review this
Thank you for investing in Bank of drive the company’s strategy. CEO Brian 2020 Annual Report, our 2021 Proxy
America. The directors bring Moynihan discusses this in greater Statement and our Human Capital
independent and diverse perspectives detail in his nearby letter and you will Management Report.
to our task of helping create long-term see it brought to life in the articles
value for you. We represent a range and disclosures throughout this report. At the annual meeting, Lionel Nowell
of expertise, backgrounds and skills, The tenets of Responsible Growth will assume the role of Lead
including chief executives and others include the company’s ESG practices. Independent Director. Lionel is totally
who have served in senior risk, Our Corporate Governance, ESG and committed to his new role and
operations, finance, technology and Sustainability Committee reviews and will continue our practice of meeting
human resources positions. reports to the board on the company’s regularly with our shareholders.
activities in these areas. This includes,
This mix of expertise and experience is for instance, the company’s recently It has been both an honor and pleasure
beneficial throughout the year, including announced commitment to net-zero to serve as Lead Independent Director.
in the fall when the management team greenhouse gas emissions by 2050. On behalf of Brian, Lionel and the
presents the company strategy for the other directors, thank you for investing
board to review and approve. We oversee in Bank of America.
A message from incoming

Lead Independent Director Lionel Nowell
director in January 2013, and I have Capital Management Report and other
appreciated the opportunity to oversee non-financial disclosures we make
the development and execution of to give you as clear a piCture of our
the company’s strategy for long-term company as we can.
Responsible Growth. Fifteen of the
company’s 16 directors are independent I also value the insights I receive when
and we bring our unique perspectives I speak with shareholders; I intend to
to each of our board and committee maintain a consistent rhythm of
meetings. engagement in the same fashion as my
predecessor, Jack Bovender. I want to
Our discussions among ourselves thank Jack for his impressive leadership as
To my fellow shareholders: and with the company’s management our Lead Independent Director, and I look
are grounded in facts and data. I forward to assuming those responsibilities
I join Brian Moynihan, Jack Bovender and am particularly pleased with the level after the 2021 annual meeting.
the other directors in thanking you for of detail we regularly disclose to our
choosing to invest in Bank of America. investors, including in the 2020 Human Thank you again for your investment in
I began my service as a Bank of America our company.

Bank of America
Board of Directors
Brian T. Moynihan Sharon L. Allen Susan S. Bies Jack O. Bovender, Jr. Frank P. Bramble, Sr.
Chairman of the Board and
Chief Executive Officer
Pierre J.P. de Weck Arnold W. Donald Linda P. Hudson Monica C. Lozano Thomas J. May
Lionel L. Nowell III Denise L. Ramos Clayton S. Rose Michael D. White Thomas D. Woods
R. David Yost Maria T. Zuber
We set the tone at the top through oversight by our Board

of Directors, who oversee our corporate strategy. In addition,
the heads of our eight lines of business as well as key
leadership for International and our institutional client base
make up our Executive Management Team.

Bank of America
Executive Management Team
Brian T. Moynihan Raul A. Anaya Dean C. Athanasia Catherine P. Bessant D. Steve Boland
Chairman of the Board and President, Business Banking President, Retail and Preferred Chief Operations and President, Retail
Chief Executive Officer & Small Business Banking Technology Officer
Alastair M. Borthwick Sheri B. Bronstein James P. DeMare Paul M. Donofrio Anne M. Finucane
President, Global Chief Human Resources President, Global Markets Chief Financial Officer Vice Chairman,
Commercial Banking Officer Bank of America
Geoffrey S. Greener Christine P. Katziff Kathleen A. Knox Matthew M. Koder David G. Leitch
Chief Risk Officer Chief Audit Executive President, Private Bank President, Global Corporate Global General Counsel
& Investment Banking
Aron D. Levine Bernard A. Mensah Thomas K. Montag Thong M. Nguyen Andrew M. Sieg
President, Preferred and President, International Chief Operating Officer Vice Chairman, President, Merrill Lynch
Consumer Banking & Bank of America Wealth Management
Investments
Andrea B. Smith Bruce R. Thompson Sanaz Zaimi

Chief Administrative Officer Vice Chairman, Head of Global Fixed Income,
Bank of America Currencies and Commodities
Sales; CEO of BofA Securities
Europe SA, and Country
Executive for France

Addressing a global health
crisis as one company
We’re united in helping our teammates, clients and communities — when and
where they need us most.
In 2020, our company rallied as we never have before — across every business and in
cities and towns around the world — to respond to the health and humanitarian crisis
affecting individuals, families and business owners in the communities where we live
and work. Our services are essential to our clients and to the economy. Through our
global presence and longstanding focus on addressing critical social issues, we’ve taken
care of our teammates and their families, delivered for our clients when and where
they needed it most and supported relief efforts around the world. And, together, we
ended 2020 stronger and more committed to the people and causes we care about.

Supporting the health and safety
of our teammates
Our teammates’ health and safety is always our top priority. to teammates impacted by the coronavirus, and we continue
Since the coronavirus was first identified, we have taken many to offer 24/7 confidential counseling through our Employee
broad-ranging steps to protect all of our teammates and to Assistance Program (EAP) for teammates and their
support their families. immediate family members.
• We seamlessly transitioned about 85% of our employees Additionally, we have taken specific actions to support
to work from home, including any teammate who identified the health of our thousands of teammates working in the
as high-risk. For employees who identify as high-risk, many office — in our financial centers, operations centers and
have been redeployed to roles they can perform remotely. trading floors — and to recognize all our employees are doing
in support of our clients, including:
• To ensure our employees maintain access to critical
medical resources, we have provided no-cost telehealth • Temperature checks, daily health screenings and
resources with 24/7 virtual access to general medicine onsite nurses at many of our sites. We will continue to
doctors and mental health specialists, home delivery service expand these measures prior to additional employees
of preventative prescription medications with a temporarily returning to the office.
waived refill waiting period and no-cost coronavirus testing.
• Onsite coronavirus testing introduced for employees
• To help address the personal impacts the environment has working in our financial centers and administrative
had on teammates and their families, we have expanded buildings with more than 100 employees working in
our back-up childcare for employees in the U.S., the office
including providing nearly three million days of back-up child
• Enhanced deep cleanings of our facilities, installing
and adult care and an investment of nearly $300 million
thousands of wellness barriers and putting physical
in child and adult care reimbursements in 2020 to help offset
distancing markings in place for our employees and clients
costs for our teammates. We have continued that support
in 2021. • Special compensation programs, including supplemental
pay, enhanced overtime pay and other special incentives
• Additionally, we have provided a variety of resources to help
for employees working in our offices and buildings to
parents and caregivers as their children return to
serve clients
school (whether in-person or virtually), including a dedicated
back-to-school website with webinars, articles, weekly tips • Transportation and meal subsidies, delivering more than
and discounts on computers, devices and school supplies. three million meals to employees to-date
• We also have added new physical and mental health
These are just some examples of how we have supported our
resources, such as training for stress management,
teammates and their families during this critical time. For
resiliency and mindfulness — and provided additional
more information on these and other programs and benefits
vacation and personal day flexibility.
we provide, read about our response to the coronavirus in
• We have expanded our dedicated team of Life Event our 2020 Human Capital Management Report.
Services (LES) specialists to provide personalized support

Delivering for our clients
When our clients needed us most, our teammates redoubled Specifically, we helped 343,000 small business clients receive
efforts to help clients navigate the changes and challenges loans through the Small Business Administration’s Paycheck
of 2020 in new and creative ways: transitioning from in-person Protection Program — extending more than $25 billion — and
to virtual interactions, using new technologies and launching processed more than $26 billion of EIP for clients in 2020. We
client relief efforts. also processed nearly two million payment deferral requests.
Employees around the world continued to provide advice,

guidance and access to all our capabilities to help clients
meet their financial needs. In particular, teammates have
been proactively reaching out to clients across all businesses,
including by sending millions of emails and placing outbound
calls to Consumer & Small Business clients, holding thousands
of calls, meetings and broadcasts to actively advise and
343,000
connect with Merrill Lynch Wealth Management and Private We have helped 343,000 small
Bank clients, and issuing proactive guidance and market business clients receive loans
insight from our BofA Global Research and Investment Insights through the Small Business
teams through multiple channels, including virtual investor Administration’s PPP.
conferences.
Our employees have also delivered critical financial relief for

clients through our programs as well as efforts launched by the
federal government.

Investing in our communities
Additionally, to help address the impact of the coronavirus in our
communities, we donated important PPE to communities
across the U.S., including more than 22 million face coverings,
nearly 3 million gloves and more than 17,000 cases of sanitizer
through early February 2021.
We pledged $100 million toward medical supplies, food

security and other vital support, and an additional $250 million
to community development financial institutions (CDFIs)
to provide more companies and not-for-profits access to
important capital.
And, in recognition of the broad and deep impact the

humanitarian crisis is having on communities and people of
color, we have made a $1 billion, four-year commitment to
accelerate work underway to help advance racial equality
and economic opportunity — specifically focused on workforce
development, healthcare, housing and small-business
assistance.
Donating PPE in our communities
22M+ 3M 17,000+
face coverings gloves cases of hand sanitizer
Investing in our communities
$100M $250M $1B

toward medical supplies, to CDFIs to provide more 4-year commitment to
food security and other companies and not-for-profits accelerate work underway
vital support access to important capital to help advance racial equality
and economic opportunity
Looking ahead to 2021

While we made a tremendous impact in supporting our
teammates, clients and communities in 2020, our work isn’t
finished. The health crisis continues to affect the global
economy as well as individuals and communities around the
world. Our focus now is what else we can do — and how we
can do it better. Throughout 2021 and beyond, we remain
resolute in how we meet our clients’ changing needs, how we
take care of our teammates and how we help our communities
move forward in meaningful ways.

Working together to meet clients’
changing needs in a challenging year
Q&A with D. Steve Boland, President, Retail and
Aron Levine, President, Preferred and Consumer Banking & Investments
In 2020, Steve and Aron worked together to deliver exceptional service and a full suite of
products and platforms to help make our clients’ financial lives better.
in our financial centers, we believe we can quickly adapt

and respond to clients’ evolving needs. In 2020, we used
our Client Assistance Program to help clients experiencing
hardships related to the impact of the coronavirus and
provided financial relief through the Coronavirus Aid, Relief
and Economic Security Act and the PPP, as well as by
processing EIP.
Q. How is Bank of America meeting the needs of today’s

mass affluent clients?
Aron: Mass affluent clients have more diverse needs than
ever before and are looking for advice and education to help
them meet their banking, lending and investing goals. Our
Preferred business is designed to provide these clients with
streamlined ways to manage their finances and obtain advice
and guidance when and wherever they want. We provide
extensive rewards and benefits across their entire relationship
with us — the more they do with us, the more their benefits
grow. Throughout 2020, our high-tech digital capabilities
together with our personalized high-touch approach allowed us
to deliver a more intuitive and efficient banking experience for
our clients across all of our channels, providing the expertise
of financial professionals in our financial centers, Merrill
offices, digitally and over the phone.
Q. Bank of America launched Balance Assist last year.

What is it, and why was it the right thing to do?
Steve: Balance Assist provides a unique low-cost, digital way
for our clients to manage their short-term liquidity needs,
borrowing only the amount they need, up to $500. We believe
people want the power to achieve financial freedom and
stability, and are seeking simple, clear solutions and advice
Q. What did you learn from clients last year, and how did
you respond to their changing needs?
Steve: Our clients needed to know that we would stand by “We’re in an advantageous
them and help provide safe and reliable ways to help them position to provide the solutions
manage their finances any time and any way they choose.
We found that the best way to do this — and what our and advice our clients need
clients are most comfortable with — is through our award- while helping them build their
winning digital capabilities. Our high-tech and high-touch
approach means that between our full-featured mobile and
financial acumen.”
online platforms and the expert, personal service we offer

to help them along the way. Balance Assist is the latest in
a set of transparent, easy-to-use solutions to help our clients
budget, save, spend and borrow carefully and confidently. Growth in Zelle and Erica users
With solutions like SafeBalance Banking®, the Keep the Change® (millions)
savings program, our secured credit cards and our affordable
homeownership options, we’re in an advantageous position to
provide the solutions and advice our clients need while helping 17.2
them build their financial acumen.
Q. Clients often begin a financial relationship with Bank

12.9
of America as young adults then progress to Retail,
Preferred and beyond. How is Bank of America equipped
10.3
to help clients at every stage of life? 9.7
Aron: We are committed to meeting the full range of our

clients’ needs, at every stage of their financial lives. To do so, 6.7
we strive to develop strong partnerships across our Retail and 4.8
Preferred businesses, as well as with Merrill and the Private
Bank, to serve the needs of our clients along the full wealth
spectrum. We introduced Bank of America Life Plan® to help
clients set and track progress on their short- and long-term 2018 2019 2020
financial goals based on their life priorities and relationship
with us. We’ve also invested heavily in providing quality Zelle Erica
financial education and developing industry-leading tools and
resources, like Better Money Habits® and our new Idea Builder
to help ensure clients are banking and investing with their
financial goals in mind. Together, we offer a comprehensive
relationship, and provide a streamlined way for clients to
manage their finances with advice and guidance that grows
along with them. “We are committed to meeting the
full range of our clients’ needs, at every
stage of their financial lives.”
Growth of digital banking, lending

and investing at Bank of America
In 2020, our clients depended on our digital capabilities more assistant Erica®, Zelle® and Mobile Check Deposit, among
than ever before, with 69% of our Consumer, Small many others, as well as our virtual (phone, video and chat)
Business and Wealth Management households generating channels. The number of Erica users grew 67% over the course
nine billion logins. of the year, and Erica has helped clients with over 200 million
requests since launch in 2018. Notably, Zelle transaction
To better serve our clients, we invested in new technologies volume grew 71% year-over-year. Our automated channels
and enhanced our industry-leading digital capabilities, (mobile, online and ATMs) accounted for 84% of deposits
developed and deployed by Head of Digital David Tyrie and in 2020, up from 78% in 2019.
his team, in partnership with Chief Information Officer
and Head of Consumer, Small Business & Wealth Management We deliver a wealth of services through our mobile and online
Technology Aditya Bhasin and his organization in Global banking, ATM and Erica platforms, and are constantly exploring
Technology & Operations. ways to expand, interconnect and perfect these tools to
deliver a more seamless, personalized experience for each client
Digital accounted for 42% of consumer sales, and our that spans and supports their entire relationship with us.
Consumer & Small Business households were reliant on
our core digital capabilities, such as our digital financial

Delivering for our clients
with defining differentiators
Q&A with Matthew Koder
President, Global Corporate & Investment Banking
For our Global Corporate & Investment Banking While 2020 may have physically separated us from our clients,
it didn’t dampen the opportunity to stay connected, deepen
teammates and operational specialists, close relationships and drive enhanced value. We significantly
coordination and enhanced communication increased the level of our communications with our clients
was key to providing optimal financing and and expanded our client base by leveraging local coverage
strategic solutions for clients while winning teams and cross-business integration opportunities. We
believe the more clients do with us, the more value we can
their confidence in 2020. offer them from our integrated resources and expertise.
In addition, despite the complexities of the environment, we
Q. How did your business stand out in 2020? continued to enhance our client-facing platforms at a record
Matthew: Despite last year’s unprecedented uncertain market pace to drive connectivity and efficiency and deliver smarter,
environment, we were relentless in helping our clients and faster and more secure digital experiences for clients.
distinguishing our business with many leading, innovative
solutions. We provided support by advising across the entire Q. What were some of your key accomplishments
capital structure and executing transactions across loans, in 2020?
bonds, convertibles, follow-ons, IPOs, private capital markets, Matthew: When our clients needed a strong financial partner
mergers and acquisitions and more. Through it all, we believe through the crisis, we were committed to be there — approving
the high volume of deals and transactions we completed on over $100 billion in credit across approximately 500 requests.
behalf of our clients repeatedly showed we had their trust In addition, our team’s resilience and the seamless strength
and that our integrated corporate banking, investment banking of our connections positioned us as the industry leader in
and capital market services — along with the bank’s strong re-opening the capital markets after the initial market
balance sheet, highly developed global platform and innovative dislocation resulting from the pandemic. By the end of 2020,
solutions — were our defining differentiators. we helped raise approximately $772 billion of capital in the

global capital markets. This leadership and experience
further provided us with critical insight into investor
receptivity, which allowed us to advise our clients on
optimal financing solutions across products, markets and
geographies throughout the year.
We believe all of these efforts resonated with our clients

and translated into our ability to increase our investment
banking fees by 27% in 2020. This resulted in a total
of $7.2 billion in fees, which was a record for a full-year
and also included three of the strongest quarters in
our company’s history. In addition, we increased our
investment banking industry ranking to #3 and grew our
Making significant
market share by 70 bps — including our highest ever
share in equity capital markets and mergers and
progress internationally
acquisitions. We see all of these as valuable indicators A message from Bernie Mensah
of our clients’ confidence in our people and capabilities.
President, International
Q. What impact did your business make on
sustainable finance in 2020? Our international presence, which spans approximately
35 countries and territories, is vital to the thousands
Matthew: Leadership in ESG and sustainable finance
of corporate and institutional clients that we serve. We
are valuable competitive differentiators for Bank of
strive to provide rapid, on-the-ground access to our
America. We’re always looking for innovative solutions
expansive platform and capabilities, exceptional market
for investors to support social and environmental
insight and a talented, diverse and dedicated employee
change. The past year was particularly meaningful to
base. Never has this been more important than in
us because our bankers and operations teams drove a
2020, a year of significant progress for our company
number of industry-leading achievements.
internationally, notwithstanding the challenges of the
health crisis.
For example, we were the #1 global underwriter of
corporate ESG-related bonds. In addition, we helped
In Asia Pacific, we generated record revenues
launch the world’s first sustainability-linked bond and
participating in the rapid growth of capital markets
led the first green convertible bond in the U.S. with
in the region and connecting investment capital to
a designated green use of proceeds. This particular
significant opportunities presented in many of the
accomplishment represented an important, innovative
world’s fastest growing large economies. From China
landmark, as it was the first time sustainable finance
to Australia, and India to Japan, we provided critical
tools crossed over into the equity-linked market.
advice on multiple transactions, helping clients to
We also underwrote nearly $50 billion in coronavirus-
access primary capital and market liquidity as needed.
related social bonds, helping a broad audience from
corporations to national governments finance their
In Europe, Africa and the Middle East, despite the
pandemic responses.
backdrop of more challenging economic conditions and
political uncertainties, we continued to see our franchise
Strong interest from our clients in these bonds shows
advance with important new client gains in many
that companies can do good and do well. There is a
product areas. In addition, after nearly four years of
growing desire around the globe to support investments
preparation, we successfully completed our thorough
that have a positive societal impact. And, we’re proud to
Brexit planning, making the necessary adjustments
be at the forefront in delivering these solutions.
to ensure we could continue to seamlessly and
efficiently service all clients in both the E.U. and the
Q. Looking to 2021 and beyond, what do you want
U.K. from our key hubs in Dublin, Paris and London
your clients to know?
and additional local offices. With Brexit uncertainties
Matthew: That we will continue to be there for them. In behind us, we now look forward to continuing to expand
the long shadow of the health crisis and amidst so many our market share across all our lines of business in
transformational changes, we will continue to be there the region.
for our clients as their steadfast and trusted partner. We
are committed to leveraging our resources and franchise We now are focused on building on our current
to deliver for them — and grow with them — as the momentum by continuing to drive Responsible Growth
recovery takes root. globally and meeting client needs in the year ahead.

Delivering innovative wealth solutions
and exceptional client service
Our focus on supporting our clients in The bank’s digital leadership also made it easier for us
to provide more comprehensive service. With one click,
Merrill Lynch Wealth Management and clients can deposit checks, make transfers, pay their
Bank of America Private Bank is stronger mortgage and see their credit card activity. During 2020,
— and more important — than ever 77% of wealth management clients used our online or
before. To meet clients’ diverse needs and mobile platforms and opened 107,000 bank accounts.
maintain the highest level of service as we The importance of advice and guidance in a
helped them navigate the changes 2020 changing environment
presented, our advisors created new ways Throughout 2020, our clients and families expressed
to deliver innovative solutions and the a greater need for comprehensive and personalized
financial advice than at any time in the past. Our
power of Bank of America’s capabilities Chief Investment Office helped answer the call by
and technology. As a result, we forged even providing valuable insights through its rapid-response
deeper, more meaningful connections with commentaries, as well as through its industry-leading
thought leadership and investment strategies, the
our existing clients, while adding thousands latter comprising more than 100 managed investment
of new relationships — and improving platforms.
client satisfaction across the board.
Building wealth management for the future
Running a relationship business when people In 2020, we continued to carry out our vision to be our
can’t come together clients’ trusted partners — providing support, helping
As the environment changed, our wealth management them meet their needs and achieve their goals by
businesses quickly transitioned to connecting with clients providing helpful advice and service at every stage of
in new ways, including meeting virtually. Through rapid their financial lives. We are led by advisor teams with a
deployment of Webex video conferencing, 25,000 wealth passion to serve and excel. Our exceptional colleagues
teammates held approximately 375,000 virtual client are winning more top rankings than any other firm
meetings — five times more than the year before — and multiple awards for their customer service and
engaging clients in wealth, estate and philanthropic philanthropy expertise. And we are becoming more
planning conversations. Our teams also stayed connected diverse, better reflecting the families, enterprises,
virtually, setting strategy, sharing peer-to-peer learning institutions and communities we serve.
and insights and recognizing success in new ways.
We believe Bank of America’s wealth management
Expanding digital capabilities to meet clients’ needs businesses are strongly positioned for the future, ready
Throughout the year, we added a steady stream of digital to answer the next set of challenging questions that
enhancements to transform how we deliver advice and comes. We will continue to strive to be an industry leader,
service. Working closely with our clients, we empowered and we will judge our performance on our success in
them to embrace our digital innovations so they could helping our clients achieve their goals.
access information, execute transactions and seamlessly
collaborate with their advisors.
For example, clients now use Mobile Easy Sign digital

signatures for more than 80% of account opening and
maintenance tasks. Through the Client Engagement
Work Station, advisors can view all critical information
regarding clients’ accounts which helps deliver a great
experience. Another innovation, the Personal Wealth
Analysis, is a single tool connecting clients’ goals to
investment solutions.

What sets us apart:
BofA Global Research
Candace Browning
Head of Global Research
Under the leadership of Candace Browning, BofA Global Research is constantly evolving
with a singular focus — to best serve the needs of our clients. The division was named
Top Global Research Firm by Institutional Investor magazine from 2011-2016 and in 2019,
and the No. 2 firm in 2017, 2018 and 2020. More information about these awards can be
found at https://go.bofa.com/awards.
A team of more than 675 analysts located in 20 countries “Through strategic innovation and collaboration across regions,
provides recommendations on 3,300 stocks and 1,350 sectors and disciplines, our mission is to transform information
corporate bond issuers globally across 24 sectors, as well as into actionable investment insight,” said Browning.
forecasts for 56 economies, forecasts for 26 commodities
and recommendations on 47 currencies. The goal is to create From major world events to deep-dives into sectors and
innovative, collaborative and forward-looking research and industry-leading research on ESG impacts, the team leverages
deliver it in a variety of ways that suit our clients. its knowledge, relationships and cutting-edge technology to
uncover insights and trends.
In 2020, during a year of unprecedented market volatility,
44,000+ BofA Global Research demonstrated its commitment to our

clients by delivering more than 44,000 research reports and
hosting nearly 3,000 conference calls.
Delivered more than 44,000
research reports

Serving our clients and
communities through technology
Through our Global Technology & invest approximately $3 billion annually in technology
growth — especially in digital, mobile and online platforms.
Operations team, we’re providing industry-
leading capabilities to drive client service Further driving the digital transformation is our culture
and deepen relationships, faster and better. of innovation. Last year, the bank ranked 108th on the
Intellectual Property Owners Association’s list of the top
There is no question that the events of the past year 300 U.S. organizations receiving patents, our highest
accelerated the use of digital capabilities by our clients ranking ever. That ranking reflects our company’s
across every line of business, with nine billion online and record-high 443 patents for innovations related to
mobile logins in our consumer and wealth management money transfers, bill payments, ATM transactions, check
businesses alone. We saw record-setting levels of use verification using augmented reality and authentication
of our digital and electronic channels to conduct every technology. The bank’s patent portfolio consists of more
element of our clients’ business — investing, savings, all than 4,600 patents and applications, resulting from the
the way up to our large institutional customers. work of more than 5,700 inventors from 12 countries.
People are interested in virtual connectivity and its “Innovating is essential to making life easier for our
ability to augment and, in some cases, replace physical clients,” said Cathy Bessant, chief operations and
connectivity. Add in the fact that we had no choice but technology officer. “We do not have an innovation lab or
to connect virtually, and our digital capabilities really an innovation team, because it’s everyone’s job. These
worked to our advantage. 2020 has shown us that digital numbers demonstrate our unmatched commitment to
adoption will continue to grow. making sure innovation is part of our DNA.”
Our clients’ rapid adoption of digital capabilities was During the world health crisis this past year, we realized
made possible by work we began a decade ago. Back the importance of connectivity, bandwidth and technical
then, we started to simplify and modernize our tools. We are using technology to bridge divides by
technology and infrastructure, an intensive transformation helping to make sure connectivity is universal and equally
that would support our businesses, help reduce risk and available to all. We believe equity of access and service
improve our competitive cost position. Through that will drive economic mobility and equality going forward,
work, we removed $2 billion annually from our operating and Bank of America will strive to be at the forefront
expenses while replacing core platforms to create of that change.
modern operations.
“Merrill benefits tremendously from the technology

investments made by Bank of America over the past
several years,” said Andy Sieg, president of Merrill
Lynch Wealth Management. “Our best-in-industry
digital capabilities continue to set Merrill apart from
the competition, enabling clients to work with us
when they want, how they want, while providing the
seamless experience they demand.”
Shared platforms and a common infrastructure across

the enterprise brought together company data and
emerging technology to improve service, drive speed
to market and increase data accuracy, while decreasing
risk and improving cost to serve our clients. Our modern
infrastructure and simplified operations underscore
the importance of smart investments. We continue to

Market Presidents deliver our global company
to each client, employee and community
Hong Ogle For example, last year, Houston teammates in Business
President, Bank of America Houston Banking and the Private Bank came together to help a
20-year, Houston-based client sell their company to another
In cities and towns across the U.S., Bank of client in Ohio. The Houston-based client manager connected
America’s more than 90 market presidents and the Texas client to a local Private Bank advisor, ultimately
their teams lead the local work of the company helping them entrust the proceeds of the sale, along with
other assets, to the Private Bank. This interaction highlights
to serve clients, support teammates and the value and importance of integration across our businesses
strengthen communities. In 2020, the efforts in markets across the country.
of our market presidents were more critical
than ever, particularly in cities like Houston, Integrating our capabilities and expertise influences how
market presidents and their teams address challenges
Texas, that faced challenges on multiple fronts. facing their communities. After our four-year, $1 billion
commitment to drive racial equality and economic
“2020 will be a year to remember,” said Hong Ogle, opportunity was announced, the Houston team went to
president of Bank of America Houston, who also leads work, partnering with local elected officials and
the Central South Division for the Private Bank region, community leaders to help ensure the collective resources
overseeing offices in Texas, Kansas, Oklahoma, Arkansas were spent wisely.
and the surrounding states. “In addition to the health
crisis, oil and gas price volatility added extra stress on Hong also feels a personal connection to the commitment
Houston, the energy capital of the world. And, being the the company has made to driving equality and helps further
hometown to George Floyd pushed our city to the front these efforts locally in the Houston community. She came
lines of the racial justice movement.” to the U.S. from China when she was 24, and is a leader
in several company diversity groups as well as the city’s
Through it all, Hong says, the team remained undeterred, Greater Houston Partnership Racial Equity Committee. “I feel
rising to the challenge to support teammates, serve a strong responsibility to help make sure dollars are spent
clients and help the Houston community. Hong is especially where it makes a difference,” she said. “It’s not just about
complimentary of the financial center teammates who giving money — it’s helping people and communities. And it’s
expertly cared for clients who needed our support and helping not just those individuals who benefit directly from
services throughout the health crisis and of commercial these programs; it’s also helping their families and future
banking client managers, financial advisors and personal generations.”
bankers who rallied to help their clients manage through
changing conditions. This focus on clients and community led Bank of America
to be named Large Corporation of the Year by the Association
Integrating our full capabilities for the benefit of each of Fundraising Professionals Greater Houston and Hong
client is among the chief responsibilities of our market to be recognized as a Houston Business Journal Most Admired
presidents, who help to ensure all lines of business are CEO in 2019, accolades that reflect the team’s work carrying
working together seamlessly. forward the bank’s mission while making an impact locally.

Being a great place
for our teammates to work
A message from Sheri Bronstein As a company, we have a long history of supporting our
Chief Human Resources Officer teammates and their families by investing in their physical,
emotional and financial well-being. In response to the global
health crisis, we took significant steps to provide enhanced
We know 2020 will be remembered for many resources and benefits to help our teammates stay healthy
reasons, including the global health crisis and and balance the competing priorities of work and home. Those
the social and racial inequalities that were benefits include access to virtual medical and behavioral
exacerbated by it. At Bank of America, it consultations, robust emotional wellness training through
our partnership with Thrive Global and child and adult care
was a year that strengthened our resolve to resources designed to help our teammates ensure their loved
identify additional opportunities to support ones were cared for. You can read more about our support for
our teammates and address societal issues. teammates on page 15.
Together, we continued driving progress, and
We also felt the urgency to address the ongoing impacts of
we have much to be hopeful for as we look racial inequality in the communities where we live and work.
ahead. And importantly, in 2020 we were While diversity and inclusion is and has been core to our values
reminded how critical it is that we take care as a company for multiple decades, it was a year in which
we needed to bring together our efforts with our teammates
of ourselves, our families, our clients, our and marry those with the work we do with our communities
communities and each other. and clients. Our courageous conversations series served as a
foundation for dialogue amongst our leaders, our teammates,
visiting speakers and authors, and gave a platform for our
$25 million charitable donation to the Smithsonian so they
could facilitate conversations on race across our country
through the eyes of one of our most important educational

museums and institutions. Our longstanding efforts to Our deep appreciation for our teammates, their dedication to
drive economic opportunity and upward mobility provided living our purpose and their support for each other remained
the foundation for us to quickly accelerate efforts we had at the core of every decision we made in 2020. And from last
underway to create greater opportunities for people and year, we learned incredible lessons: thanks to our teammates,
communities of color. While we have much more to do, I am our ability to remain resilient and the importance of our
proud of the initiatives we’re advancing in connection to our decade-long commitment to Responsible Growth, we were
$1 billion, four-year initiative focused on addressing systemic able to serve our clients and communities when they needed
gaps in education, healthcare, workforce development, housing us most. As we begin a new year, our focus on supporting our
and other important areas. You can learn more about these teammates, their families and the clients and communities we
efforts on page 33. serve will continue to guide everything we do.
I also encourage you to read about our efforts to support

the health and safety of our teammates as well as the
work we’re doing to advance racial equality and economic
opportunity in our 2020 Human Capital Management Report.
We initially launched this report in 2019 as a means to provide
200,000+
We support our more than
transparency into our employee practices, our workforce 200,000 global teammates
diversity metrics and all that we do for our teammates to be a and their families through
great place to work. It was the first-of-its-kind in the industry comprehensive benefits,
and has been met with overwhelmingly positive responses programs and resources.
from our shareholders, our teammates and our clients.
2020 Human Capital Management Report

In November, we released our 2020 Human Capital
Management Report, which continues our efforts to
provide clarity and transparency around all we do
to be a great place to work and to support our more
than 200,000 teammates and their families. Building
on our inaugural Human Capital Management Report
from 2019, our 2020 report shares the many programs
and resources, as well as supporting data, in our
primary focus areas: being a diverse and inclusive
workplace; attracting and retaining exceptional talent;
providing holistic benefits supporting our teammates’
physical, emotional and financial wellness; and
recognizing and rewarding performance.
New in this year’s report is information on the many

unprecedented steps we have taken during the ongoing
health crisis and to advance work underway to drive
racial equality and economic opportunity. In addition,
we continue to share metrics on diverse representation
across our company, a practice we have had in place for
many years. We will continue to report on these items
and the progress we’re making as part of our ongoing
focus on driving Responsible Growth and making this
the best place for our teammates to work.

Driving meaningful change
when the world needs it most
Our ongoing work to foster a diverse and inclusive at all levels of our company,” says our Chief Diversity &
environment took on greater meaning for our more than Inclusion and Talent Acquisition Officer Cynthia Bowman.
200,000 global teammates during a year that brought issues
of racial inequality and social injustice to the forefront. The We also look to address societal priorities that impact
global health crisis has exposed longstanding disparities in communities around the world. In 2020, building on
our society and inspired one of the greatest social justice longstanding work underway, we made a $1 billion, four-year
movements in modern history. commitment to help drive racial equality and economic
opportunity for people and communities of color with a focus
These realities strengthened our resolve and inspired our work on healthcare, jobs, small businesses and housing. We’ve also
to right the injustices we’ve witnessed. We have a greater continued to deploy capital to businesses and communities
clarity of purpose for where we want to go as a company and in need of economic revitalization through CDFIs and issuing
in the communities where we live and work — as well as the social bonds.
work we need to do to get there.
Another way we actively promote these principles is by
This starts with being a great place for our teammates to engaging each other through courageous conversations —
work, which is foundational to continuing to drive Responsible sharing perspectives on our differences and establishing
Growth. We know we must reflect the diversity of the clients connections to create greater empathy and understanding.
and communities we serve and continue to take meaningful Last year, we held courageous conversations, reaching
steps to ensure diverse representation at all levels of our more than 165,000 employees with civil rights, social
company. Attracting diverse talent is a priority, and we achieve justice and inclusion leaders focused on racial, social and
this through a variety of recruiting efforts, including through economic injustices.
internships and campus programs, targeted partnerships with
diverse organizations, support for military and veterans, and As we look to the work and road ahead, investing in our
hiring and reskilling individuals from low-and-moderate income teammates, our clients and communities will always be core
(LMI) communities. “We know that just because you have to who we are and how we drive Responsible Growth. By first
diversity in representation does not mean you have inclusion. looking inward and holding ourselves accountable to increasing
That’s why we continue to work to ensure we have a culture diversity across our teams, we will continue taking steps
where our teammates feel comfortable bringing who they are forward to help drive inclusion and meaningful progress in the
to work each day and why we offer equal access to opportunity communities we serve.

Supporting emotional wellness
and mental health
Supporting our teammates’ emotional wellness and mental Our ongoing work to care for our teammates’ emotional
health has always been a critical focus for us. In 2020, people’s wellness and mental health includes confidential counseling
daily lives and routines were impacted in many ways, bringing and unlimited telephone consultations, available 24/7, through
the conversation of emotional wellness and mental health our Employee Assistance Programs for both teammates
to the forefront. Given the new stressors and demands our and members of their household. And, for support for
teammates faced over the year, it was important employees major life events, our internal, highly specialized Life Event
understood the range of resources available to support their Services team connects employees to resources, benefits
emotional wellness and mental health. We enhanced our and counseling.
ongoing offerings to include innovative, industry-leading and
flexible programs and resources to help our teammates and
their families. “The last year taught us that prioritizing our
In 2020, we provided no-cost consultations with Teladoc’s® emotional wellness and mental health
behavioral health specialists for employees on a national U.S. was incredibly important. It was critical to
bank medical plan. We also expanded training and education ensure that our employees knew they,
to help teammates build key skills to enhance their well-being.
Additionally, through our partnership with Thrive Global, a and their loved ones, were supported. As
corporate and consumer well-being firm, we launched we move into 2021, our focus will stay
emotional wellness and resiliency training for employees.
These virtual courses address stress management as well as
the same — offering benefits, programs
ways to build resiliency and avoid burnout. Our mindfulness and resources to meet their diverse needs.”
daily practice sessions and introductory courses hosted by
internal specialists help teammates create and maintain peace
— Chris Fabro, Global Head of Compensation,
of mind. In addition, ongoing mental health tips from experts, Benefits and Executive Development
mindfulness apps and open conversations about mental health
helped teammates prioritize their own wellness.

Continuing to be a workplace where
all teammates can grow and thrive
In a year unlike any before, the diversity and broad perspectives of our teammates enabled us
to make a positive impact for our clients and communities. We continue to invest heavily
in our people — bringing diverse talent to our company, supporting their well-being and giving
opportunities to grow and develop. Meet four exceptional women who bring their diversity
of thought and experiences to life across our company.
Helping teammates Hiring the next

care for their families generation of leaders
Jessica Cullen Reena Shukla
Global Banking & Markets Global Technology & Operations
Global Commercial Banking Relationship Manager EMEA Operations Executive
Jessica Cullen, a relationship manager in Global Commercial London-based Reena Shukla believes exceptional talent can
Banking, and her husband started working from home in be found at all levels. After completing Merrill’s graduate
early 2020 due to the health crisis, while also caring for their recruitment program, she has grown her career and is now
two young daughters. With daycare centers closed, Jessica a managing director, leading the EMEA Client Services team
needed care for her children while working from home, for Global Markets. Reena is passionate about recruiting
so she looked into Bank of America’s expanded childcare others early in their careers whose contributions can
benefits after hearing about them from her manager. Eligible challenge the status quo and inspire new ways of thinking to
teammates can take advantage of the bank’s expanded strengthen our teams and client relationships — something
back-up care benefits, which include reimbursement of up she can relate to given her own experience with the
to $100 a day when securing their own care provider. “It bank’s recruiting efforts. Reena is focused on hiring
was super easy to sign up for the childcare benefit, and the teammates who demonstrate a natural curiosity to learn
reimbursement process is quick,” explains Jessica. She took and challenge themselves. “Recruiting fresh talent pushes
advantage of the opportunity to hire someone from her boundaries within our teams and enables new ideas for
personal network, and was thrilled to be able to help one of the ways we serve our clients,” explains Reena. Through
the teachers at her daughters’ daycare center who had lost Bank of America’s Africa recruitment initiative and the U.K.
income due to the coronavirus-related closures. “It’s good government apprenticeship program, Reena has built a
for her and good for us,” Jessica said. “The best part is my balanced team with both experienced and new talent, with
entire management team has been extremely supportive. each providing significant contributions for future success.
The resources and empathy toward working parents make “Hiring talent early in their careers helps develop our
me really proud to work for Bank of America.” future leaders, something that I have experienced firsthand
at our company.”

Leading the way to a Helping teammates grow and
more inclusive environment develop fulfilling careers
Adrienne Hughes Evelyn Castillo
Merrill Consumer & Small Business
Client Experience Executive Consumer Banking Region Executive
As Merrill’s client experience executive, Adrienne Hughes After joining Bank of America in 2009, Evelyn Castillo, a
recognizes the power of strong, authentic connections. She Consumer Banking region executive, never imagined she
is personally committed to creating an inclusive culture would still be working at the same company nearly a decade
that values, encourages and leverages the strength of our later. Motivated by support from mentors as well as the
diversity. “Inclusion comes from celebrating our uniqueness many development opportunities she’s discovered, Evelyn
and creating an environment where people are valued and has grown her career at Bank of America in a way that
encouraged to bring who they are to the workplace — takes advantage of her strengths and builds new skills. “I
creatively collaborating to strengthen our business,” says have been blessed to have great leaders and mentors who
Adrienne. Involved in several Bank of America Employee invested in me and my abilities. I see the impact this has
Networks, which help teammates be heard, develop had on my career, and I want to give that same opportunity
leadership skills, build ties with peers and local communities to others,” says Evelyn. Inspired by her experiences at the
and advance diversity recruitment, Adrienne has embraced bank, she has made it her mission to mentor her teammates
her advocacy for inclusion in the workplace by using her and develop their leadership skills. By taking advantage of
voice and encouraging others to do the same. She has taken the bank’s many career development resources, Evelyn has
advantage of Bank of America’s passion for open and honest been able to help develop and promote the next generation
discussions and hosted several courageous conversations of leaders. Additionally, as a market president lead for
around race, equality and economic opportunity in the Consumer & Small Business and member of the Hispanic/
Chicago market. As a member of our Women’s Leadership Latino Organization for Leadership and Advancement
Council and the Multicultural Women Ready to Lead Employee Network, Evelyn is able to interact with
Initiative, Adrienne also continues to be a leader for women’s diverse employees and connect them to areas of interest.
equality in the workplace. “I am proud to work for a company “Making connections enables career mobility, which helps
that invests in creating a culture where every individual retain our talent. I’m proof you can have a lifelong career
is valued. I’m inspired to lead by example and drive that at Bank of America.”
commitment forward.”
Representation of people of color across our company
18% 20% 48% 54%
of our management team of our management levels of our U.S. workforce of our full-time campus
are people of color 1–3 are people of color are people of color hires are people of color

Being a great place to work —2020 highlights
A critical component of how we drive Responsible Growth is making Bank of America a great place
to work. See how we fulfill that commitment to our employees.
Hired 10K+ Equal pay for

military veterans equal work
We surpassed our goal of hiring over For teammates in comparable
10,000 military veterans, achieving positions, compensation received by
our five-year commitment, with plans women, on average, was greater than
to maintain hiring momentum for 99% of that received by men; and
the future. compensation received by people of
$20 minimum color was, on average, greater than
99% of that received by teammates
hourly rate who are not people of color.
In the first quarter of 2020, we raised
our minimum hourly rate of pay for
U.S. employees to $20, one year earlier
than planned.
Medical premiums
Supporting career for employees
development Since 2012, there has been no increase
We provide an extensive portfolio of
learning and leadership development
in medical premiums for employees
earning less than $50,000.
$500 wellness
opportunities to our more than 200,000 credit
employees, including foundational and We provide a $500 credit toward
skills-based training and an enterprise- medical plan premiums following
wide focus on manager development. completion of a wellness screening and
questionnaire (or $1,000 if a covered
Hiring 10K+ from spouse or partner also completes).
LMI communities
We hired more than 10,000 employees
from LMI communities since 2018 —
ahead of our commitment to do so
Sharing
by 2023. our success
For the fourth time since 2017, we
Up to $7,500 recognized teammates with a special
award in cash or restricted stock. In the
in tuition first quarter of 2021, approximately Employee
reimbursement 97% of teammates received a
Delivering Together award, in addition Relief Fund
Through our tuition reimbursement to any regular annual incentives. Employees can receive up to $2,500
program, we provide up to $7,500 (up in financial assistance through our
to $5,250 tax-free) annually for eligible Employee Relief Fund for a qualified
undergraduate or graduate courses. disaster and up to $5,000 for an
emergency hardship.

Investing $1 billion over
four years to advance racial equality
and economic opportunity
In 2020, we saw intensified passion to address the obstacles to true racial equality in the U.S. In
response, we accelerated work already underway to announce a $1 billion, four-year initiative to
help advance racial equality and economic opportunity with a focus on four areas:
• Jobs and reskilling the workforce
• Supporting minority small business owners
• Making home ownership and rental housing more affordable
• Addressing inequities in health services
This work is being led by Vice Chairman Anne Finucane and developed by a cross-functional team led by Global Head of ESG
Andrew Plepler with the expertise and perspective of the company’s Black and Hispanic Leadership councils, our local market teams
and other business leaders. It recognizes that issues of racial equality and economic opportunity are deeply connected, and that
understanding the past is critical to charting a path forward. Our objective is to address systemic barriers where they exist and help
drive more opportunity and sustained progress.
Already, we’ve allocated more than $300 million (or one-third) across 91 markets and globally, including:
Investments in 61 private Partnerships with more Launched Smithsonian’s

equity funds across the U.S. than 20 higher education “Race, Community and Our
$150 million in funds focused institutions and major Shared Future”
on minority entrepreneurs and employers Program to deliver thought leadership
predominantly led by diverse fund on civil rights, social justice and
Jobs initiatives with community
managers economic mobility to communities
colleges, historically Black colleges
and universities and Hispanic-serving across the country
institutions to connect students
to career success
Expanding opportunities Capital investments in Partnerships with CVS

for 50,000 women 14 MDIs and CDFI banks Health and local nonprofits
Bank of America Institute for Women’s Toward lending, housing, neighborhood Flu vaccine vouchers in under-
Entrepreneurship at Cornell, with a revitalization and other banking resourced communities and donations
focus on women of color services of PPE to community partners across
the country
“We must not let the current intense demand for action die down. And we will not. Our
management team, our market presidents and market executives, leaders of our company
at every level, all of us can and will do more.” — CEO Brian Moynihan
Addressing the world’s challenges
through sustainable finance
A conversation with Anne Finucane, Vice Chairman and

Karen Fang, Global Head of Sustainable Finance
At Bank of America, sustainability is embedded in our operating model. This extends to how we
support our clients through core lending and investments; equity and debt capital markets
activities; the advisory services we offer; how we manage our supply chain and how we conduct
our own operations. In 2020, after meeting our goal to be carbon-neutral a year early, we finalized
our commitment to achieve net-zero greenhouse gas (GHG) emissions before 2050 across
all scopes of emissions including those from our operations, financing activities and supply chain.
Central to our purpose as a financial services company, we with approximately $55 billion allocated to climate finance. In
will need to assist our clients in their own carbon reduction addition, approximately $45 billion was allocated to Inclusive
journey. To accelerate our sustainable finance work and help Development. This includes our significant lending and
create a consistent perspective across all of our capabilities investing in affordable housing, healthcare, education and
and product offerings, in January 2020, we established the other social infrastructure as a part of our support for local
Sustainable Markets Committee, which I co-chair along with communities across the U.S. Also included are the deposits
Chief Operating Officer Tom Montag. To lead this effort, we and equity capital we provided to CDFIs and MDIs, and equity
named Karen Fang as the Global Head of Sustainable Finance. and fund investments into minority-owned businesses as a
Karen and I sat down recently to talk about our progress, the part of our $1 billion racial equality and economic opportunity
business, and our goals for 2021. initiative. And the global health crisis and associated
challenges did offer the opportunity for some unique offerings
Anne: Karen, we have developed a leadership position in by our company. Can you discuss that a little bit?
clean energy finance, and we will discuss that later. This
year, though, we saw particular interest in other aspects of Karen: Yes, we are particularly proud of two innovative
sustainable finance, against a backdrop of economic and social transactions we completed in 2020 for Bank of America that
challenges during the global health crisis. We mobilized and demonstrate the creativity and strength of collaboration
deployed approximately $100 billion of sustainable finance across many of our lines of business in an effort to deliver for
capital aligned with the United Nations (U.N.) SDGs in 2020, a our clients. In May 2020, we issued a $1 billion corporate social
significant increase from 2019 despite the global challenges, bond focused on the coronavirus response, the first such

“The Sustainable Markets Committee platinum Leadership in Energy and Environmental Design
(LEED) skyscraper and continue to make progress in our own
gathers our capabilities across every line real estate footprint. So our own track record means we are
of business and puts them to work for our well positioned to (i) have a comprehensive discussion with
clients who are innovating and investing our clients about carbon neutrality and net-zero as a business
imperative; (ii) encourage clients to establish a concrete and
in the low carbon, sustainable economy.” credible glide path plan to reduce their own carbon footprints;
and (iii) offer clients advisory services and financial tools to
— Tom Montag, Chief Operating Officer
support their decarbonization efforts toward net-zero.
Karen: Exactly. In 2020, we developed the “4 R’s” approach

offering by a U.S. bank. This bond was designed to provide to decarbonization for our corporate clients: Reduce,
targeted lending to healthcare institutions that are on the Renew, Retire, and Realign. We financed energy efficiency
front lines of combatting the health crisis, and it paved the projects that helped clients reduce their energy usage; we
way for Bank of America to underwrite and distribute more helped shift clients’ electricity footprints from fossil fuels
than $50 billion of social bonds for numerous governments, to renewable energy by providing debt financing, tax equity
agencies and public companies. This speaks to our ability and leasing capital for wind and solar power generation; we
to scale capital deployment for important societal needs. mobilized capital for more EV production and leasing; and
we financed LEED-certified construction of office facilities
In September 2020, we issued a $2 billion equality progress and manufacturing sites. We are also helping develop a more
sustainability bond to advance racial equality, economic robust, voluntary carbon-offset market.
opportunity and environmental sustainability. The social side
of the proceeds were exclusively allocated to make new and Anne: Whether it is Environmental Transition or Inclusive
impactful investments and lending in affordable housing, Development, our business focus has been to expand
healthcare, and small businesses in Black and Hispanic-Latino current activities and innovate to help advance emerging
communities. This first-of-its-kind transaction again inspired technologies. New domains and possibilities seem to be
other issuers to follow similar approaches, scaling capital emerging at an ever faster pace. In the area of Environmental
for wealth creation and socioeconomic empowerment of Transition, we are looking at solutions for the next frontier
these communities. beyond wind, solar, and EVs including (i) clean hydrogen,
fuel cells, sustainable aviation fuels and waste-to-energy;
Some highlights on the environmental transition side include (ii) EV charging and battery infrastructure; (iii) nature and
underwriting and distributing green and sustainability bonds, engineered solutions for carbon capture and offsets; and
completing some of the largest asset finance transactions (iv) sustainable agriculture and better water infrastructure.
for renewable energy generation and providing financing and Let’s talk about what we’re focused on in the Inclusive
leasing solutions for energy efficiency projects and electric Development side of things.
vehicles (EVs).
Karen: We’ll continue to help advance racial and gender
Bank of America’s commitment to sustainable finance runs equality, support healthcare as we focus on continued
deeper than just doing transactions. Thanks to the commitment coronavirus response and vaccine delivery, and investing in
and leadership from you, our whole Management Team and job training and reskilling. Certain projects that we are
all of our teammates, we are at the forefront of climate pursuing include working with developers to create affordable
change thought leadership. We are key members of various housing projects that incorporate more environmental and
global alliances focused on sustainable development, such social sustainability features and materials. Also, we are
as the U.N. Global Investors for Sustainable Development, expanding our supply chain financing and banking services
the World Economic Forum Net-Zero Transition Finance to more minority-owned and operated businesses.
Committee, His Royal Highness the Prince of Wales’
Sustainable Markets Initiative, the Rocky Mountain Institute
Center for Climate Aligned Finance and the 1t.org U.S.
Steering Council, among others.
Anne: Let’s talk a little more about “traditional” sustainable

finance, if I can use that term since we’ve been at it now
for so many years. We reached carbon neutrality in our own
footprint and are on a path toward net-zero before 2050. We
have reduced our energy use by 40% and our location-based
GHG emissions by 50%, sourced renewable energy to power
our facilities, and purchased and retired carbon offsets for
those final amounts of unavoidable emissions. In keeping
with our focus on the environment, we even erected the first

2020 ESG highlights*
Our strong focus on environmental, social and governance (ESG) is key to how we drive
Responsible Growth. We’re addressing society’s greatest challenges through our investments,
philanthropy and responsible business operations. This helps us to serve clients, deliver
returns for our shareholders and contribute to a more sustainable future.
Sustainable finance Small business lending

We mobilized and deployed
Affordable homeownership
Having surpassed our initial We provide dedicated support to meet
approximately $100 billion in capital the needs of our 13 million small
commitment, we tripled our Bank of
to support the environmental transition business owners and are a top lender
America Community Homeownership
to a low-carbon economy, as well as in the SBA’s 504 and 7(a) programs,
Commitment® to $15 billion through
inclusive development focusing on according to the FDIC. More than half
2025, aiming to help more than
affordable housing, healthcare, education (54%) of all small business loans booked
60,000 LMI individuals and families
and racial/gender equality. in 2020 were made to LMI borrowers.
purchase a home. Since 2019, the
initiative has helped nearly
21,000 individuals and families purchase
a home and over $180 million in
Environmental business down payment and closing cost grants. Sustainable client balances
commitment We have $36.8 billion in assets in our
Our Environmental Business Initiative wealth management business with
will direct at least $445 billion to a clearly defined ESG investment
low-carbon, sustainable business Community approach.
activities by 2030. Since 2007 when
it was launched, we have mobilized
Development Banking
We provided a record $5.87 billion in
more than $200 billion to these efforts
loans, tax credit equity investments
across the globe.
and other real estate development Green, social and
solutions through $3.62 billion in sustainability bonds
debt commitments and $2.25 billion We issued a $1 billion corporate social
in investments to help build strong, bond to support those on the front
Tax equity for renewables sustainable communities by financing lines of the health crisis; and a first-
We have been the top tax equity investor affordable housing and economic of-its kind $2 billion equality progress
in the U.S. since 2015. Our Tax Equity development across the country. sustainability bond to help advance
renewable energy portfolio at the end of Between 2005 and 2020, we financed racial equality, economic opportunity
2020 was approximately $10.1 billion. more than 215,000 affordable and environmental sustainability. Since
Our investments have contributed to housing units. 2013, Bank of America has issued
the development of approximately 17% $9.85 billion in eight corporate Green,
(33GW) of total installed renewable wind Social and Sustainability Bonds. We
and solar energy capacity in the U.S. have also been a leader in ESG-themed
Community development bond underwriting globally since
2007, having underwritten more than
financial institutions (CDFI) $75 billion on behalf of more than
Blended Finance lending 225 clients, supported more than
Catalyst Pool We originated over $394 million in loans 400 deals and provided critical funding
Our Blended Finance Catalyst Pool will and investments as part of our more to environmental and social projects.
provide $60 million from Bank of America than $1.8 billion portfolio in 256 CDFIs
to leverage additional private capital to to finance affordable housing, economic
help address the U.N. SDGs. We finalized development projects, small businesses,
commitments totaling $15 million in four healthcare centers, charter schools, and
different blended finance vehicles that other community facilities and services.
will help mobilize more than $500 million
in total investor funds.
*Data and metrics are as of year-end 2020 unless otherwise noted.

17 organizations focused on racial
equality and economic opportunity.
Net-zero commitment Last year, despite shifting to a
We are carbon neutral and purchase Women’s economic virtual environment, our employees
100% renewable electricity. We have empowerment volunteered over 1.1 million hours and
committed to achieving net-zero We expanded opportunities for 50,000 directed $65 million to communities
greenhouse gas emissions in our women entrepreneurs, with a focus on through individual giving and the bank’s
financing activities, operations and women of color, to participate in the matching gifts program.
supply chain before 2050. Bank of America Institute for Women’s
Entrepreneurship at Cornell, the only
online Ivy League certificate program for
women business owners in the world.
More than 20,000 women are currently
Pathways
Climate risk and Since 2018, Bank of America’s
enrolled, representing over 85 countries,
ESG disclosure including the U.S..
Pathways program has fueled our
We disclose our risk and governance enterprise-wide talent pipeline, hiring
practices under several frameworks. On more than 10,000 employees from
page 40, we have reported under new LMI neighborhoods — well ahead of
ESG Stakeholder Capitalism Metrics our commitment to do so by 2023.
developed by the World Economic Philanthropic giving We do this through partnerships with
Forum’s International Business Council. We increased our philanthropy to more community colleges and long-time
We issued our first report under the than $350 million, including $100 million partners such as Year Up, UnidosUS
recommendations of the TCFD, and our to support communities impacted by and the National Urban League.
first SASB report. This is in addition to the health and humanitarian crisis and
publicly disclosed information about $250 million to drive economic mobility
how we manage climate risk in the and social progress in the communities
Management Discussion & Analysis we serve. We continue to advance
section of our Annual Report on Form economic mobility and nonprofit
Better Money Habits®
Through our Better Money Habits
10-K and reporting through the GRI leadership through our Neighborhood
platform, we continue to connect people
and CDP (formerly known as Carbon Builders and Neighborhood Champions
to relevant advice, tools and guidance
Disclosure Project) global disclosure programs, investing $256 million to
that empowers them to take control of
system. We also disclose our ESG support more than 1,000 nonprofits and
their finances. Content on the Better
strategy, policies and practices in 2,000 nonprofit executives since 2004.
Money Habits website was accessed for
our Environmental and Social Risk Last year, through local partnerships
free over 6 million times, and consumers
Policy Framework and Human Capital and our own Student Leaders program,
clicked through to make an appointment
Management Report. we connected more than 4,000 young
more than 23,000 times. Mejores Habitos
people to early employment.
Financieros, our Spanish site, was
accessed more than 1 million times. To
further extend these resources in LMI
Arts and culture communities, more than 4,300 employee
We remain steadfast in our support
of arts and culture, providing more than
Employee giving volunteers serve as Better Money Habits
and volunteering Volunteer Champions, delivering financial
$50 million in support to arts and culture know-how in partnership with local
nonprofits around the world last year. In response to the health and
humanitarian crisis and the need to nonprofits across the U.S.
We fulfilled all commitments in 2020,
whether or not partners were open and/ advance racial equality, we lowered
or their programming had been digitized, our matching gift minimum to $1 and
postponed or canceled. doubled our match for donations to

Bank of America Corporation — Financial highlights
Bank of America Corporation (NYSE: BAC) is headquartered in Charlotte, North Carolina. As of December 31, 2020, we
operated across the United States, its territories and more than 35 countries. Through our banking and various nonbank
subsidiaries throughout the United States and in international markets, we provide a diversified range of banking
and nonbank financial services and products through four business segments: Consumer Banking, Global Wealth and
Investment Management, Global Banking and Global Markets.
Financial highlights ($ in millions, except per share information)

For the year 2020 2019 2018
Revenue, net of interest expense $ 85,528 $ 91,244 $ 91,020
Net income 17,894 27,430 28,147
Earnings per common share 1.88 2.77 2.64
Diluted earnings per common share 1.87 2.75 2.61
Dividends paid per common share 0.72 0.66 0.54
Return on average assets 0.67% 1.14% 1.21%
Return on average common equity 6.76% 10.62% 11.04%
Return on average tangible common shareholders’ equity1 9.48 14.86 15.55
Efficiency ratio 64.55 60.17 58.40
Average diluted common shares issued and outstanding 8,797 9,443 10,237
At year-end 2020 2019 2018

Total loans and leases $ 927,861 $ 983,426 $ 946,895
Total assets 2,819,627 2,434,079 2,354,507
Total deposits 1,795,480 1,434,803 1,381,476
Total shareholders’ equity 272,924 264,810 265,325
Book value per common share 28.72 27.32 25.13
Tangible book value per common share1 20.60 19.41 17.91
Market capitalization 262,206 311,209 238,251
Market price per common share 30.31 35.22 24.64
Common shares issued and outstanding 8,651 8,836 9,669
Tangible common equity ratio1 6.5 7.3 7.6
Total Cumulative Shareholder Return² BAC Five-Year Stock Performance

$250 $40
KBW
$30
$200 S&P
$20
$150
B of A
$10
$100
$0
2016 2017 2018 2019 2020
$50
HIGH $23.16 $29.88 $32.84 $35.52 $35.64
LOW 11.16 22.05 22.73 24.56 18.08
$0
CLOSE 22.10 29.52 24.64 35.22 30.31
2015 2016 2017 2018 2019 2020
December 31 2015 2016 2017 2018 2019 2020 Book Value Per Share/
Bank of America Corporation $100 $133 $181 $154 $225 $199 Tangible Book Value Per Share¹
S&P 500 100 112 136 130 171 203
$28.72
$27.32
153
$25.13
KBW Bank Sector Index 100 129 152 125 171

$23.97
$23.80
$20.60
$19.41
$17.91
$16.96
$16.89
2016 2017 2018 2019 2020

Book Value Per Share Tangible Book Value Per Share
1 Represents a non-GAAP financial measure. For more information on these measures and ratios, and a corresponding reconciliation to GAAP financial measures, see Supplemental
Financial Data on page 54 and Non-GAAP Reconciliations on page 111 of the 2020 Financial Review section.
²This graph compares the yearly change in the Corporation’s total cumulative shareholder return on its common stock with (i) the Standard & Poor’s 500 Index and (ii) the KBW Bank Index
for the years ended December 31, 2015 through 2020. The graph assumes an initial investment of $100 at the end of 2015 and the reinvestment of all dividends during the years indicated.

Recognition
We are honored to be recognized by organizations and media around the world for our work in driving Responsible Growth, including
our ESG commitments and initiatives and our efforts to be a great place to work.
In 2020, we were recognized by Fortune as one of their 100 Best Companies to Work For, Working Mother as the number-one best
company for Dads and Euromoney as the World’s Best Bank for Corporate Responsibility, among several others. Below are some
of our most recent awards.
Fortune The Banker Equileap

100 Best Companies to Work For (2020, 2019) Most Innovative Investment Bank of the Year for U.S. and Global Gender Equality Reports (2019)
Best Big Companies to Work For (2020, 2019) Corporate Social Responsibility (2019) named the leading company in U.S. for gender
only financial services company recognized two Climate Leadership Awards equality
years in a row Innovative Partnership Certificate (2019) Black Enterprise
Best Workplaces for Women (2020, 2019) Investing in Women Initiative 50 Best Companies for Diversity (2018)
Best Workplaces in Financial Services & Catalyst Award Winner (2019) Dave Thomas Foundation for Adoption
Insurance (2020, 2019) Forbes 100 Best Adoption-Friendly Workplace
Corporate Responders (2020) (2020, 2019)
Best Workplaces for Diversity (2019)
Top Women Advisors (2020) Disability:IN and the American Association
Best Workplaces for Parents (2020, 2019) of People with Disabilities
240 Merrill advisors recognized
Best Workplaces for Giving Back (2018) Disability Equality Index (2020) scored 100%
World’s Best Employers (2019)
Change the World (2020, 2019) Global Employer of the Year (2019)
named the top global bank two years in a row Bloomberg
Gender-Equality Index (2019) National Association of Asian American
Euromoney Professionals
World’s Best Bank for Corporate Responsibility Financial Services Gender-Equality Index (2017) Milestone Honor Award (Asian Leadership
(2020) Brandon Hall Network, 2016)
Excellence in Leadership—North America (2020) 25 Human Capital Management Excellence Global Finance Magazine
Awards (2020) Best Bank in the United States (2020)
Best Digital Bank—North America (2020)
RateMyPlacement Best Bank in North America (2020)
Best Bank for Transaction Services—North 100 Undergraduate Employers (2019-2020)
America and Latin America (2020) Best Consumer Digital Bank in the United States
PEOPLE Magazine (2020)
Best Bank for Small and Medium-Sized Companies that Care (2020, 2019)
Enterprises—North America (2020) Best Bank in the World (2019)
AnitaB.org
World’s Best Bank for Diversity and Inclusion Top Companies for Women Technologists (2019) LATINA Style
(2019) Company of the Year (2020)
Diversity MBA Magazine
World’s Best Bank (2018) 50 Out Front: Best Places for Women & Diverse Top 50 Best Companies for Latinas to Work for
Managers to Work (2020, 2019) in the U.S. (21 consecutive years)
World’s Best Bank for Corporate Social
Responsibility (2017) JUST Capital Top 12 Companies of the Year (2019)
Asia’s Best Bank for Corporate Social America’s Most JUST Companies (2020, 2019) Top 12 Employee Resource Groups of the Year
Responsibility (2019) JUST 100 (2020) (Hispanic-Latino Organization for Leadership &
Advancement, 2019)
Barron’s Military Times
100 Most Sustainable Companies (2020) Best for Vets: Employers (2020, 2019) National Association for Female Executives
(NAFE)
Top Women Advisors (2020) Stonewall UK Workplace Top Companies for Executive Women (12 years)
recognized for the 15th consecutive year Equality Index (2020, 2019)
PR News
LinkedIn Fatherly CSR Award for Employee Relations (2019)
50 Top Companies in the U.S. (2019) Certified Best Place to Work for Dads (2019)
top ranking financial institution CDP
American Council on Renewable Energy A list named for the ninth year (2019)
Working Mother (ACORE)
Top Wealth Advisor Moms (2020) Renewable Energy Leadership Award (2019) Supplier Engagement Leaderboard (2019)
125 Merrill advisors recognized Center for Political Accountability
Dow Jones Sustainability Index
100 Best Companies (32 consecutive years) World Index (top 10% of banks) (2019) Trendsetter on CPA-Zicklin Index of Corporate
Political Disclosure and Accountability
Best Companies for Multicultural Women North America Index (top 20% of banks) (2019) (2016-2019)
(2020, 2019)
UK Armed Forces Covenant
Best Companies for Dads (2020, 2019) Employer Recognition Scheme Gold Award
Diversity Best Practices Inclusion Index (2020) (2016-2020)
U.S. Environmental Protection Agency U.S. Veterans Magazine
EPA Green Power Leadership Award for Top Veteran-Friendly Company (2020)
Excellence in Green Power (2019)

STAKEHOLDER CAPITALISM METRICS
The index reflects our report in alignment with the Stakeholder Capitalism Metrics (the Metrics) published by the International
Business Council of the World Economic Forum. We believe these Metrics help to demonstrate how our sustainable business model
drives progress towards inclusive capitalism and the U.N.’s Sustainable Development Goals. In this index, we either reference
existing disclosures or respond directly. We currently do not report on all of the Metrics but will continue to evaluate both core
and expanded metrics for potential future additional disclosure. Our commitment is to provide investors with useful, relevant and
meaningful sustainability information and we expect our disclosures to evolve over time. All reported data is as of and for year
end December 31, 2020, unless otherwise noted.
INDICATES CORE METRIC
Principles of Governance
THEME METRIC RESPONSE
Governing Purpose Setting Purpose: The company’s stated purpose, as the Our Responsible Growth strategy referenced in this 2020 Annual
expression of the means by which a business proposes Report and our 2021 Proxy Statement articulates how our purpose
solutions to economic, environmental, and social issues. and environmental, social and governance leadership creates
Corporate purpose should create value for all stakeholders, stakeholder value.
including shareholders.
Purpose-led management: How the company’s stated purpose

is embedded in company strategies, policies, and goals.
Quality of Governing Body Composition: Composition of the highest Refer to the section entitled “Proposal 1: Electing directors” in our
Governing Body governance body and its committees by: competencies relating 2021 Proxy Statement available on the Bank of America Investor
to economic, environmental, and social topics; executive or Relations website at www.bankofamerica.com/investor.
non-executive; independence; tenure on the governance body;
number of each individual’s other significant positions and
commitments, and the nature of the commitments; gender;
membership of under-represented social groups; stakeholder
representation.
Progress against strategic milestones: Disclosure of Refer to our 2019 ESG Performance Data Summary available at
the material strategic economic, environmental, and social www.bankofamerica.com/ESGData.
milestones expected to be achieved in the following year,
such milestones achieved from the previous year, and how
those milestones are expected to or have contributed to
long-term value.
Remuneration: Refer to the section entitled “Compensation discussion and analysis”

1. How performance criteria in the remuneration policies in our 2021 Proxy Statement available on the Bank of America Investor
relate to the highest governance body’s and senior executives’ Relations website at www.bankofamerica.com/investor.
objectives for economic, environmental and social topics, as
connected to the company’s stated purpose, strategy, and
long-term value.
2. Remuneration policies for the highest governance body
and senior executives for the following types of remuneration:
Fixed pay and variable pay, including performance-based pay,
equity-based pay, bonuses, and deferred or vested shares,
Sign-on bonuses or recruitment incentive payments,
termination payments, clawback and retirement benefits.
Ethical Behavior Anti-corruption: 1. 100% of Bank of America employees are required to take training
1. Total percentage of governance body members, employees on anti-bribery and anti-corruption policies as part of Bank of
and business partners who have received training on the America’s Code of Conduct training.
organization’s anti-corruption policies and procedures, broken 2. For disclosure of significant litigation and regulatory matters, see
down by region. Note 12 — Commitments and Contingencies on page 161 of the 2020
2. (a) Total number and nature of incidents of corruption Financial Review section.
confirmed during the current year but related to previous 3. Refer to our Code of Conduct on the Bank of America Investor
years and Relations website available at www.bankofamerica.com/investor.
(b) Total number and nature of incidents of corruption
confirmed during the current year, related to this year.
3. Discussion of initiatives and stakeholder engagement to
improve the broader operating environment and culture, in
order to combat corruption.
Protected ethics advice and reporting mechanisms: A Refer to page 13 in our Code of Conduct on the Bank of America
description of internal and external mechanisms for: Investor Relations website available at www.bankofamerica.com/
1. Seeking advice about ethical and lawful behaviour and investor.
organizational integrity
2. Reporting concerns about unethical or unlawful behaviour
and organizational integrity
Monetary losses from unethical behaviour: Total amount For disclosure of significant litigation and regulatory matters, see
of monetary losses as a result of legal proceedings associated Note 12 — Commitments and Contingencies on page 161 of the 2020
with: fraud, insider trading, anti-trust, anti-competitive Financial Review section.
behaviour, market manipulation, malpractice, or violations of
other related industry laws or regulations.

Ethical Behavior Alignment of strategy and policies to lobbying: The Refer to our Political Activities disclosure available on the Bank of
(continued) significant issues that are the focus of the company’s America Investor Relations website at www.bankofamerica.com/
participation in public policy development and lobbying; the investor.
company’s strategy relevant to these areas of focus; and any
differences between its lobbying positions, purpose, and any
stated policies, goals, or other public positions.
Risk and Opportunity Integrating risk and opportunity into business process: Refer to our Environmental and Social Risk Policy Framework available
Oversight Company risk factor and opportunity disclosures that clearly at www.bankofamerica.com/ESRPF.
identify the principal material risks and opportunities facing
the company specifically (as opposed to generic sector risks),
the company appetite in respect of these risks, how these risks
and opportunities have moved over time and the response to
those changes. These opportunities and risks should integrate
material economic, environmental, and social issues, including
climate change and data stewardship.
Stakeholder Material issues impacting stakeholders: A list of the topics Refer to our ESG Materiality disclosure available at
Engagement that are material to key stakeholders and the company, how the www.bankofamerica.com/ESGMateriality.
topics were identified, and how the stakeholders were engaged.
Planet*
Climate Change Greenhouse Gas (GHG) emissions: For all relevant Bank of America’s 2019 greenhouse gas emissions (tCO₂e) are as
greenhouse gases (e.g. carbon dioxide, methane, nitrous follows. Since 2010, we have reduced location-based emissions 56%
oxide, F-gases etc.), report in metric tonnes of carbon globally. For more information, refer to our ESG Performance Data
dioxide equivalent (tCO₂e) GHG Protocol Scope 1 and Summary (2019) available at www.bankofamerica.com/ESGData.
Scope 2 emissions. Estimate and report material upstream • Scope 1: 62,639
and downstream (GHG Protocol Scope 3) emissions where
• Location-based Scope 2: 728,771
appropriate.
• Market-Based Scope 2: 17,523
• Total net Scope 1 and Market-Based Scope 2: 0
• Scope 3 Purchased Goods and Services: 2,329,208
• Scope 3 Capital Goods: 251,336
• Scope 3 Fuel- and Energy-Related Activities: 161,151
• Scope 3 Upstream Transportation and Distribution: 140,215
• Scope 3 Waste (Traditional Disposal): 22,386
• Scope 3 Business Travel: 162,457
• Scope 3 Employee Commuting: 378,088
• Scope 3 Downstream Transportation and Distribution: 1,400,000
• Scope 3 Use of Sold Products: 4,000
• Scope 3 End of Life Treatment of Sold Products: 19,000
TCFD implementation: Fully implement the recommendations In 2020, Bank of America released its Task Force on
of the Task Force on Climate-related Financial Disclosures Climate-related Financial Disclosures (TCFD) Report available
(TCFD). If necessary, disclose a timeline of at most three years at www.bankofamerica.com/TCFD.
for full implementation. Disclose whether you have set, or have In early 2021, Bank of America took the next step in our climate
committed to set GHG emissions targets that are in line with journey by publicly committing to achieve net zero greenhouse
the goals of the Paris Agreement — to limit global warming to gas emissions before 2050 across our operations, supply chain,
well-below 2°C above pre-industrial levels and pursue efforts and financing activities. For more information, refer to
to limit warming to 1.5°C — and to achieve net-zero emissions www.bankofamerica.com/NetZero.
before 2050.
Paris-aligned GHG emissions targets: Define and To reach the goals of the Paris Agreement, we are developing a
report progress against time-bound science-based GHG strategy across our entire value chain which includes setting interim
emissions targets that are in line with the goals of the Paris emission reduction targets based on science, engaging with clients
Agreement — to limit global warming to well-below 2°C above on climate goals and supporting climate innovation. Our net zero goal
pre-industrial levels and pursue efforts to limit warming to includes operations (Scope 1 and 2), supply chain (Scope 3 upstream
1.5°C. This should include defining a date before 2050 by which emissions) and all material emissions attributed to our loans and
you will achieve net-zero greenhouse gas emissions and interim investments (Scope 3 investments). For more information, refer to
reduction targets based on the methodologies provided by the www.bankofamerica.com/NetZero.
Science Based Targets initiative if applicable.
Impact of Greenhouse gas emissions: Report wherever The societal impact of Bank of America’s Scope 1, Scope 2 (location-
material along the value chain (GHG protocol Scopes 1, 2 & 3), based), and Scope 3 (Categories 1–7, 9, 11–12) emissions in 2019
the valued societal impact of greenhouse gas emissions. was estimated to be $238 million. This figure was calculated using the
Disclose the estimate of the social/societal cost of carbon used EPA’s 2020 social cost of carbon of $42/metric ton CO₂ (3% discount
and the source or basis for this estimate. rate, reported in 2007 USD).
Fresh water Water consumption and withdrawal in water-stressed In 2019, Bank of America withdrew 7,550 and consumed 1,630 mega
availability areas: Report for operations where material, mega litres of liters of water from our global operations. Of this, 38% of withdrawals
water withdrawn, mega litres of water consumed and the and 41% of consumption were from regions with high or extremely
percentage of each in regions with high or extremely high high baseline water stress according to the WRI Aqueduct water risk
baseline water stress according to WRI Aqueduct water risk atlas tool.
atlas tool. Estimate and report the same information for the
full value chain (upstream and downstream) where appropriate.

Nature Loss Land use and ecological sensitivity: Report the number In 2019, Bank of America had 8 active U.S. sites that intersected
and area (in hectares) of sites owned, leased or managed in or with areas protected for biodiversity. The area of these buildings is
adjacent to protected areas and/or key biodiversity areas (KBA). 6,900 square meters. Only U.S. sites are included in this analysis; U.S.
sites make up over 90% of Bank of America’s real estate footprint.
Sites were overlaid on the U.S. Geological Survey’s Protected Areas
Database (PADUS) to understand intersection with protected areas.
Air pollution Air pollution: Report wherever material along the value chain: Bank of America’s 2019 air pollution emissions (metric tons) are
Nitrogen oxides (NOx), sulphur oxides (SOx), particulate matter as follows. These air pollution emissions are from all of our sites
and other significant air emissions. Wherever possible, estimate globally and are not specific to urban/densely populated areas. For
the proportion of specified emissions that occur in or adjacent more information, refer to our 2019 ESG Performance Data Summary
to urban/densely populated areas. available at www.bankofamerica.com/ESGData.
• SOx: 1
• NOx: 20
• CO: 32
• VOC: 2
• Particulate Matter: 3
Impact of air pollution: Report wherever material along The valued impact of Bank of America’s air pollution (SOx, NOx, CO,
the value chain, the valued impact of air pollution, including VOCs, and PM) in 2019 was estimated to be $146,000. This figure was
nitrogen oxides (NOx), sulfur oxides (SOx), particulate matter calculated using the social cost factors of each pollutant as reported
and other significant air emissions. in the World Resources Institute’s Transport Emissions & Social Cost
Assessment (TESCA) Tool v1.0. These social cost factors are weighted
averages based on a meta-analysis of international academic studies.
*2020 Environmental Data will be published in Q2 2021.
Prosperity
Employment and wealth Absolute number and rate of employment: External Hires
generation 1. Total number and rate of new employee hires during the
reporting period, by age group, gender, other indicators of Diversity Region
diversity and region. Female 51% U.S. 84%
2. Total number and rate of employee turnover during the POC 59% APAC 12%
reporting period, by age group, gender, other indicators of Black/ EMEA 3%
diversity and region.
African American 17% LATAM 0%
Hispanic/Latino 27% Canada 0%
Turnover
Diversity Region
Total 7% U.S. 7%
Female 6% APAC 5%
POC 7% EMEA 5%
Black/ LATAM 4%
African American 7% Canada 4%
Hispanic/Latino 7%
In 2020, turnover was at extremely low levels given the pandemic,

however we would not assume these levels to remain in the future.
While external research has found that women are dropping out
of the workforce at a higher rate than men, we have not experienced
this turnover at Bank of America.
Economic Contribution: 1a–d. Refer to Financial Statements and Notes beginning on page 116
1. Direct economic value generated and distributed (EVG&D) — of the 2020 Financial Review section.
on an accrual basis, covering the basic components for the 1e. Refer to Total tax paid metric.
organization’s global operations, ideally split out by:
a. Revenue 1f. 2020 Total philanthropic giving was $350 million.
b. Operating Costs 2. See the company’s response for the Total Tax Paid metric for more
c. Employee wages and benefits information about certain income tax credits that the company does
d. Payments to providers of capital not consider to be nor includes in the response as financial assistance
e. Payments to government received from a government.
f. Community Investment.
2. Financial assistance received from the government —
Total monetary value of financial assistance received by the
organization from any government during the reporting period.

Wealth creation and Financial investment contribution disclosure: 1. We made $2.74 billion in fixed asset capital investments
Employment 1. Total capital expenditures (CapEx) minus depreciation ($0.83 billion net of depreciation) primarily related to our real estate
supported by narrative to describe the company’s investment portfolio and technology expenditures. Our real estate investments
strategy. focused on items that will allow us to bring teammates together to
2. Share buybacks plus dividend payments supported by drive greater collaboration and efficiencies in support of our effort to
narrative to describe the company’s strategy for returns of deliver one company to our clients. We invested in modernizing sites
capital to shareholders. across the portfolio while also providing health and safety resources to
all locations to support our teammates. We also continue to invest
in the expansion and modernization of our financial center network.
Additionally, our technology purchases represent hardware and
software to support ongoing investments in the Bank of America
technology infrastructure and represent efforts to continue to support
customers, clients, and employees.
2. For more information outlining our return of capital to shareholders,
see Note 13 — Shareholders’ Equity on page 166 of the 2020 Financial
Review section.
Community and Total tax paid: The total global tax borne by the company, The following table reflects the approximate amount of each category
social vitality including corporate income taxes, property taxes, non- of tax borne by the company globally. U.S. income tax law provides
creditable VAT and other sales taxes, employer-paid payroll investors in affordable housing projects, renewable energy projects
taxes and other taxes that constitute costs to the company, by and other activities that further ESG principles with credits that can
category of taxes. reduce income taxes otherwise owed. These investments generally
involve substantial pre-tax losses. The amount shown in the table for
Corporate Income Taxes paid would have been approximately $3 billion
higher were it not for these credits.
Global Tax Paid in 2020

($ in billions)
Corporate Income Taxes 2.9
Property Taxes 0.2
Non-creditable VAT and Other Sales Taxes 0.6
Employer-paid Payroll Taxes 1.7
Other Taxes 0.8
Total 6.2
Innovation in better Total R&D expenses ($): Total costs related to research and While R&D expenses are indicative of a company’s investment in
products and services development. innovation and producing better products and services for their clients,
it is not the only way to measure a company’s efforts to innovate new
products and services and to be fit for the future.
For example, Bank of America is in the midst of a 10-year $300B
commitment to finance the transition to a low-carbon economy
including the adoption of low-carbon technologies such as resource-
efficient building construction, renewable energy generation,
sustainable transportation such as electric vehicles and charging
infrastructure, and resource-efficient agriculture. We are also
dedicating significant financial, intellectual, philanthropic and catalytic
capital to support the advancement of developing technologies,
such as carbon finance, sustainable agriculture and biofuels, water
infrastructure, clean hydrogen, waste-to-energy, and carbon capture
sequestration.
In addition to our financing commitment referenced above, we
invest heavily in technology development to meet the needs of
the Corporation in support of LRR (Laws, Rules, Regulations), Data
Remediation, Resiliency and Stability, clients / new products and
efficiencies. We spent $3.5B on these items during 2020.
Bank of America is also granted patents by the U.S. Patent Office. In
2020, we filed 722 patent applications and separately received 444
patents for the products and services we bring to our clients including
innovations in information security, ATM technology, data integrity and
monitoring using artificial intelligence (AI) or machine learning, fully
functioning payment instruments, network management and network
traffic analysis. The bank is one of the top 15 holders of U.S. banking-
related patents and applications.

People
Dignity and equality Diversity and inclusion (%): Percentage of employees per Refer to pages 11 & 27 in our 2020 Human Capital Management
employee category, per age group, gender and other indicators Report available on the Bank of America Investor Relations website
of diversity (e.g. ethnicity). at www.bankofamerica.com/investor.
Pay equality: Ratio of the basic salary and remuneration for Refer to the Equal Pay for Equal Work Section in our 2021 Proxy
each employee category by significant locations of operation Statement available on the Bank of America Investor Relations website
for priority areas of equality: women to men; minor to major at www.bankofamerica.com/investor.
ethnic groups; and other relevant equality areas. We conduct rigorous analysis with outside experts to examine individual
employee pay before year-end compensation decisions are finalized
adjusting compensation where appropriate. The results of our equal pay
for equal work review are disclosed in the Proxy Statement. Our analysis
focuses on total compensation and includes geographies where we have
significant operations for women and covers the U.S. for people of color.
Wage level (%): 1. We are an industry leader in establishing an internal minimum rate
1. Ratios of standard entry-level wage by gender compared to of pay above all mandated minimums for our U.S. hourly teammates,
local minimum wage and have made regular increases over the past several years. Our
2. Ratio of CEO’s total annual compensation to median total minimum hourly wage for U.S. teammates was raised to $20 in the
annual compensation of all employees (excluding the CEO) first quarter of 2020, more than one year earlier than planned.
We compare our average U.S. hourly pay and benefits to living wage
standards utilizing MIT’s Living Wage Calculator. The Living Wage
calculator is a market based approach that measures the basic needs
of a family including items such as food, childcare, health insurance
and housing costs. We are above the living wage for a family of four in
all of our U.S. markets when we consider our average hourly pay plus
benefits in alignment with the living wage definition.
2. Refer to the section entitled “CEO pay ratio” in our 2021 Proxy
Statement on the Bank of America Investor Relations website available
at www.bankofamerica.com/investor.
Risk for incidents of child, forced or compulsory labor: An Refer to our 2019 Modern Slavery Act Statement available at
explanation of the operations and suppliers considered to have www.bankofamerica.com/ModernSlaveryAct.
significant risk for incidents of child labor, forced or compulsory
labor. Such risks could emerge in relation to type of operation
(such as manufacturing plant) and type of supplier; or countries or
geographic areas with operations and suppliers considered at risk.
Discrimination and Harassment Incidents (#) and For disclosure of significant litigation and regulatory matters, see
the Total Amount of Monetary Losses ($): Number Note 12 — Commitments and Contingencies on page 161 of the 2020
of discrimination and harassment incidents, status of the Financial Review section.
incidents and actions taken and the total amount of monetary
losses as a result of legal proceedings associated with (1) law
violations and (2) employment discrimination.
Freedom of Association and Collective Bargaining 1. No U.S.-based employees are subject to collective bargaining
at Risk (%): agreements.
1. Percentage of active workforce covered under collective 2. We do not currently conduct this assessment.
bargaining agreements
2. An explanation of the assessment performed on suppliers
for which the right to freedom of association and collective
bargaining is at risk including measures taken by the
organization to address these risks.
Health and well being Health and Safety (%): 1. This metric is not material for the banking industry.
1. The number and rate of fatalities as a result of work-related 2. Refer to pages 20–23 of our 2020 Human Capital Management
injury; high-consequence work-related injuries (excluding Report on the Bank of America Investor Relations website available at
fatalities); recordable work-related injuries, main types of work- www.bankofamerica.com/investor.
related injury; and the number of hours worked.
2. An explanation of how the organization facilitates workers’
access to non-occupational medical and healthcare services
and the scope of access provided for employees and workers.
Skills for the future Training provided (#, $): 1. Training Hours Per Person
1. Average hours of training per person that the organization’s Total 42
employees have undertaken during the reporting period, by Female 47
gender and employee category (total number of trainings
provided to employees divided by the number of employees). POC 54
Black/
2. Average training and development expenditure per full time
employee. African American 53
Hispanic/Latino 66
2. $1,600 per employee
Number of unfilled “Skilled” positions (#, %): Bank of America is committed to creating opportunities for our current
1. Number of unfilled “Skilled” positions (#) and prospective employees to grow and develop, including creating
avenues for reskilling for specialized jobs. For example, we have hired
2. Percentage of unfilled “Skilled” positions for which the more than 10,000 individuals from low- to moderate-income commu-
company will hire unskilled candidates and train them. (%). nities through our Pathways career program. For more information on
how we attract and develop talent, refer to pages 15–18 of our Human
Capital Management report available on the Bank of America Investor
Relations website at www.bankofamerica.com/investor.

2020 Financial Review

46
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Financial Review
Table of Contents
Page
Executive Summary 47
Recent Developments 48
Financial Highlights 50
Balance Sheet Overview 52
Supplemental Financial Data 54
Business Segment Operations 59
Consumer Banking 60
Global Wealth & Investment Management 63
Global Banking 65
Global Markets 67
All Other 68
Off-Balance Sheet Arrangements and Contractual Obligations 69
Managing Risk 70
Strategic Risk Management 73
Capital Management 73
Liquidity Risk 80
Credit Risk Management 84
Consumer Portfolio Credit Risk Management 85
Commercial Portfolio Credit Risk Management 91
Non-U.S. Portfolio 97
Allowance for Credit Losses 99
Market Risk Management 101
Trading Risk Management 102
Interest Rate Risk Management for the Banking Book 105
Mortgage Banking Risk Management 107
Compliance and Operational Risk Management 107
Reputational Risk Management 108
Climate Risk Management 108
Complex Accounting Estimates 108
Non-GAAP Reconciliations 111
Statistical Tables 112
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Management’s Discussion and Analysis of Financial Condition and Results of Operations

Bank of America Corporation (the “Corporation”) and its and liabilities; the estimated or actual impact of changes in
management may make certain statements that constitute accounting standards or assumptions in applying those
“forward-looking statements” within the meaning of the Private standards; uncertainty regarding the content, timing and impact
Securities Litigation Reform Act of 1995. These statements can of regulatory capital and liquidity requirements; the impact of
be identified by the fact that they do not relate strictly to adverse changes to total loss-absorbing capacity requirements,
historical or current facts. Forward-looking statements often use stress capital buffer requirements and/or global systemically
words such as “anticipates,” “targets,” “expects,” “hopes,” important bank surcharges; the potential impact of actions of the
“estimates,” “intends,” “plans,” “goals,” “believes,” “continue” and Board of Governors of the Federal Reserve System on the
other similar expressions or future or conditional verbs such as Corporation’s capital plans; the effect of regulations, other
“will,” “may,” “might,” “should,” “would” and “could.” Forward- guidance or additional information on the impact from the Tax
looking statements represent the Corporation’s current Cuts and Jobs Act; the impact of implementation and compliance
expectations, plans or forecasts of its future results, revenues, with U.S. and international laws, regulations and regulatory
provision for credit losses, expenses, efficiency ratio, capital interpretations, including, but not limited to, recovery and
measures, strategy and future business and economic conditions resolution planning requirements, Federal Deposit Insurance
more generally, and other future matters. These statements are Corporation assessments, the Volcker Rule, fiduciary standards,
not guarantees of future results or performance and involve derivatives regulations and the Coronavirus Aid, Relief, and
certain known and unknown risks, uncertainties and assumptions Economic Security Act and any similar or related rules and
that are difficult to predict and are often beyond the Corporation’s regulations; a failure or disruption in or breach of the
control. Actual outcomes and results may differ materially from Corporation’s operational or security systems or infrastructure, or
those expressed in, or implied by, any of these forward-looking those of third parties, including as a result of cyber attacks or
statements. campaigns; the impact on the Corporation’s business, financial
You should not place undue reliance on any forward-looking condition and results of operations from the United Kingdom's
statement and should consider the following uncertainties and exit from the European Union; the impact of climate change; the
risks, as well as the risks and uncertainties more fully discussed impact of any future federal government shutdown and
under Item 1A. Risk Factors of our 2020 Annual Report on Form uncertainty regarding the federal government’s debt limit or
10-K: the Corporation’s potential judgments, damages, penalties, changes to the U.S. presidential administration and Congress; the
fines and reputational damage resulting from pending or future emergence of widespread health emergencies or pandemics,
litigation, regulatory proceedings and enforcement actions; the including the magnitude and duration of the COVID-19 pandemic
possibility that the Corporation's future liabilities may be in and its impact on the U.S. and/or global, financial market
excess of its recorded liability and estimated range of possible conditions and our business, results of operations, financial
loss for litigation, and regulatory and government actions, condition and prospects; the impact of natural disasters, extreme
including as a result of our participation in and execution of weather events, military conflict, terrorism or other geopolitical
government programs related to the Coronavirus Disease 2019 events; and other matters.
(COVID-19) pandemic; the possibility that the Corporation could Forward-looking statements speak only as of the date they are
face increased claims from one or more parties involved in made, and the Corporation undertakes no obligation to update
mortgage securitizations; the Corporation’s ability to resolve any forward-looking statement to reflect the impact of
representations and warranties repurchase and related claims; circumstances or events that arise after the date the forward-
the risks related to the discontinuation of the London Interbank looking statement was made.
Offered Rate and other reference rates, including increased Notes to the Consolidated Financial Statements referred to
expenses and litigation and the effectiveness of hedging in the Management’s Discussion and Analysis of Financial
strategies; uncertainties about the financial stability and growth Condition and Results of Operations (MD&A) are incorporated by
rates of non-U.S. jurisdictions, the risk that those jurisdictions reference into the MD&A. Certain prior-year amounts have been
may face difficulties servicing their sovereign debt, and related reclassified to conform to current-year presentation. Throughout
stresses on financial markets, currencies and trade, and the the MD&A, the Corporation uses certain acronyms and
Corporation’s exposures to such risks, including direct, indirect abbreviations which are defined in the Glossary.
and operational; the impact of U.S. and global interest rates,
inflation, currency exchange rates, economic conditions, trade Executive Summary
policies and tensions, including tariffs, and potential geopolitical
instability; the impact of the interest rate environment on the Business Overview
Corporation’s business, financial condition and results of The Corporation is a Delaware corporation, a bank holding
operations; the possibility that future credit losses may be higher company (BHC) and a financial holding company. When used in
than currently expected due to changes in economic this report, “the Corporation,” “we,” “us” and “our” may refer to
assumptions, customer behavior, adverse developments with Bank of America Corporation individually, Bank of America
respect to U.S. or global economic conditions and other Corporation and its subsidiaries, or certain of Bank of America
uncertainties; the Corporation's concentration of credit risk; the Corporation’s subsidiaries or affiliates. Our principal executive
Corporation’s ability to achieve its expense targets and offices are located in Charlotte, North Carolina. Through our
expectations regarding revenue, net interest income, provision for various bank and nonbank subsidiaries throughout the U.S. and
in international markets, we provide a diversified range of
62539 financials
credit losses, net charge-offs, effective tax rate, loan growth or

other projections; adverse changes to the Corporation’s credit banking and nonbank financial services and products through
ratings from the major credit rating agencies; an inability to four business segments: Consumer Banking, Global Wealth &
access capital markets or maintain deposits or borrowing costs; Investment Management (GWIM), Global Banking and Global
estimates of the fair value and other accounting values, subject Markets, with the remaining operations recorded in All Other. We
to impairment assessments, of certain of the Corporation’s assets operate our banking activities primarily under the Bank of
Bank of America 2020 47
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America, National Association (Bank of America, N.A. or BANA) resulted in, among other things, higher rates of unemployment
charter. At December 31, 2020, the Corporation had $2.8 and underemployment and caused volatility and disruptions in
trillion in assets and a headcount of approximately 213,000 the global financial markets, including the energy and
employees. commodity markets. Although vaccines have been approved for
As of December 31, 2020, we served clients through immunization against COVID-19 in certain countries and
operations across the U.S., its territories and approximately 35 restrictive measures have been eased in certain areas,
countries. Our retail banking footprint covers all major markets COVID-19 cases have significantly increased in recent months in
in the U.S., and we serve approximately 66 million consumer the U.S. and many regions of the world compared to earlier
and small business clients with approximately 4,300 retail levels. Businesses, market participants, our counterparties and
financial centers, approximately 17,000 ATMs, and leading clients, and the U.S. and global economies have been
digital banking platforms (www.bankofamerica.com) with more negatively impacted and are likely to be so for an extended
period of time, as there remains significant uncertainty about
than 39 million active users, including approximately 31 million
the timing and strength of an economic recovery.
active mobile users. We offer industry-leading support to
To address the economic impact in the U.S., in March and
approximately three million small business households. Our
April 2020, four economic stimulus packages were enacted to
GWIM businesses, with client balances of $3.3 trillion, provide provide relief to businesses and individuals, including the
tailored solutions to meet client needs through a full set of Coronavirus Aid, Relief, and Economic Security Act (CARES Act).
investment management, brokerage, banking, trust and Among other measures, the CARES Act established the Small
retirement products. We are a global leader in corporate and Business Administration (SBA) Paycheck Protection Program
investment banking and trading across a broad range of asset (PPP), which provides loans to small businesses to keep their
classes serving corporations, governments, institutions and employees on payroll and make other eligible payments. The
individuals around the world. original funding for the PPP under the CARES Act was fully
allocated by mid-April 2020, with additional funding made
Recent Developments available on April 24, 2020 under the Paycheck Protection
Program and Health Care Enhancement Act. In December 2020,
Capital Management an additional economic stimulus package was included as part
In June 2020, the Board of Governors of the Federal Reserve of the Consolidated Appropriations Act of 2021 (the
System (Federal Reserve) notified BHCs of their 2020 Consolidated Appropriations Act), which provides relief to
Comprehensive Capital Analysis and Review (CCAR) supervisory individuals and businesses. This relief included additional
stress test results. Due to economic uncertainty resulting from funding for the PPP under the Economic Aid to Hard-Hit Small
the Coronavirus Disease 2019 (COVID-19) pandemic (the Businesses, Nonprofits, and Venues Act (the Economic Aid Act).
pandemic), the Federal Reserve required all large banks to In response to the pandemic, the Corporation has
update and resubmit their capital plans in November 2020 implemented protocols and processes to execute its business
based on the Federal Reserve’s updated supervisory stress test continuity plans and help protect its employees and support its
scenarios. The results of the additional supervisory stress tests clients. The Corporation is managing its response to the
were published in December 2020. pandemic according to its Enterprise Response Framework,
The Federal Reserve also required large banks to suspend which invokes centralized management of the crisis event and
share repurchase programs during the second half of 2020, the integration of its response. The CEO and key members of
except for repurchases to offset shares awarded under equity- the Corporation’s management team meet regularly with co-
based compensation plans, and to limit common stock leaders of the Executive Response Team, which is composed of
dividends to existing rates that did not exceed the average of senior executives across the Corporation, to help drive
the last four quarters’ net income. In December 2020, the decisions, communications and consistency of response across
Federal Reserve announced that beginning in the first quarter of all businesses and functions. We are also coordinating with
2021, large banks would be permitted to pay common stock global, regional and local authorities and health experts,
dividends at existing rates and to repurchase shares in an including the U.S. Centers for Disease Control and Prevention
amount that, when combined with dividends paid, does not (CDC) and the World Health Organization.
exceed the average of net income over the last four quarters. Additionally, we have implemented a number of measures
On January 19, 2021, we announced that the Board of to assist our employees, clients and the communities we serve
Directors (the Board) declared a quarterly common stock as discussed below.
dividend of $0.18 per share, payable on March 26, 2021 to
shareholders of record as of March 5, 2021. We also Employees
announced that the Board authorized the repurchase of $2.9 We are providing support to our teammates to help promote the
billion in common stock through March 31, 2021, plus health and safety of our employees and help to ensure our
repurchases to offset shares awarded under equity-based protocols remain aligned to current guidance by monitoring
compensation plans during the same period, estimated to be guidance from the CDC, medical boards and health authorities
approximately $300 million. This authorization equals the and sharing such guidance with our employees. We are also
maximum amount allowed by the Federal Reserve for the period. operating our businesses from remote locations and leveraging
For more information, see Capital Management on page 73. our business continuity plans and capabilities.
The Corporation has globally implemented a work-from-home
COVID-19 Pandemic posture, which has resulted in the substantial majority of our
In the first quarter of 2020, the World Health Organization employees working from home, and pre-planned contingency
declared the outbreak of COVID-19 a pandemic. In an attempt to
strategies for site-based operations for our remaining
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contain the spread and impact of the pandemic, travel bans and
employees. We continue to evaluate our continuity plans and
restrictions, quarantines, shelter-in-place orders and other
work-from-home strategy in an effort to best protect the health
limitations on business activity were implemented. Additionally,
and safety of our employees.
there has been a decline in global economic activity, reduced
U.S. and global economic output and a deterioration in
macroeconomic conditions in the U.S. and globally. This has
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Clients 1 – Summary of Significant Accounting Principles and Note 5 –

We continue to leverage our business continuity plans and Outstanding Loans and Leases and Allowance for Credit Losses
capabilities to service our clients and meet our clients’ financial to the Consolidated Financial Statements.
needs by offering assistance to clients affected by the We have provided borrowers with relief from the economic
pandemic, including providing access to credit and the impacts of COVID-19 through payment deferral and forbearance
important financial services on which our clients rely. We are programs. A significant portion of deferrals expired during the
also participating in the programs created by the CARES Act and second half of 2020, reflecting a decline in customer requests
Federal Reserve lending programs for businesses, including for assistance. As of February 17, 2021, deferred consumer
originating PPP loans. We have also participated in the Main and small business loans recorded on the Consolidated Balance
Street Lending Program, which ended on January 8, 2021. While Sheet totaled $6.8 billion, predominantly consisting of $6.4
most of our deferral programs expired in the third quarter of billion of residential mortgage and home equity loans, including
2020, we continue to offer assistance on a case-by-case basis loans serviced by others, that are well-collateralized.
when requested by clients affected by the pandemic. Other Related Matters
As of December 31, 2020, we had approximately 332,000 Although the macroeconomic outlook improved modestly during
PPP loans outstanding with a carrying value of $22.7 billion,
the second half of 2020, the future direct and indirect impact of
which were recorded in the Consumer, GWIM and Global Banking
COVID-19 on our businesses, results of operations and financial
segments. Since the PPP's inception through February 17,
condition of the Corporation remains highly uncertain. Should
2021, borrowers have submitted applications for forgiveness to
us for approximately 113,000 PPP loans with balances totaling current economic conditions persist or deteriorate, this
$10.9 billion. We have submitted approximately 72,000 PPP macroeconomic environment will have a continued adverse
loans with balances totaling $8.5 billion to the SBA for effect on our businesses and results of operations and could
repayment, of which we have received to date $5.4 billion in have an adverse effect on our financial condition. For more
repayment from the SBA. Additionally, as of February 17, 2021, information on how the risks related to the pandemic may
we have originated $4.1 billion in PPP loans under the Economic adversely affect our businesses, results of operations and
Aid Act. For more information on PPP loans, see Credit Risk financial condition, see Item 1A. Risk Factors of our 2020
Management on page 84, and for more information on Annual Report on Form 10-K.
accounting for PPP loans and loan modifications under the
CARES Act, see Note 1 – Summary of Significant Accounting
LIBOR and Other Benchmark Rates
Principles to the Consolidated Financial Statements. Following the 2017 announcement by the U.K.’s Financial
Conduct Authority (FCA) that it would no longer compel
Community Partners participating banks to submit rates for the London Interbank
We continue to support the communities where we live and work Offered Rate (LIBOR) after 2021, regulators, trade associations
by engaging in various initiatives to help those affected by and financial industry working groups have identified
COVID-19. These initiatives include committing resources to recommended replacement rates for LIBOR, as well as other
provide medical supplies, food and other necessities for those Interbank Offered Rates (IBORs), and have published
in need. We are also supporting racial equality, economic recommended conventions to allow new and existing products
opportunity and environmental sustainability through direct to incorporate fallbacks or that reference these Alternative
equity investments in minority-owned depository institutions, Reference Rates (ARRs). The continuation of all British Pound
equity investments in minority entrepreneurs, businesses and Sterling, Euro, Swiss Franc and Japanese Yen LIBOR settings
funds, as well as other initiatives. and one-week and two-month U.S. dollar LIBOR settings on the
current basis are expected to terminate at the end of December
Risk Management 2021, and the remaining U.S. dollar LIBOR settings (i.e.,
We continue to manage the increased operational risk related to overnight, one month, three month, six month and 12 month)
the execution of our business continuity plans in accordance are expected to terminate at the end of June 2023.
with our Enterprise Response Framework, Risk Framework and As a result of this and other announcements, financial
Operational Risk Management Program. For more information, benchmark reforms, regulatory guidance and changes in short-
see Managing Risk on page 70. term interbank lending markets more generally, a major
transition is in progress in global financial markets with respect
Loan Modifications
to the replacement of IBORs and certain benchmarks. The
The Corporation has implemented various consumer and
transition of IBORs to ARRs is a complex process impacting a
commercial loan modification programs to provide its borrowers
variety of global financial markets and our business and
relief from the economic impacts of COVID-19. Based on
guidance in the CARES Act that the Corporation adopted, operations.
COVID-19 related modifications to consumer and commercial IBORs are used in many of the Corporation’s products and
loans that were current as of December 31, 2019 are exempt contracts, including derivatives, consumer and commercial
from troubled debt restructuring (TDR) classification under loans, mortgages, floating-rate notes and other adjustable-rate
accounting principles generally accepted in the United States of products and financial instruments. The discontinuation of
America (GAAP). In addition, the bank regulatory agencies IBORs requires us to transition a significant number of IBOR-
issued interagency guidance stating that COVID-19 related based products and contracts, including related hedging
short-term modifications (i.e., six months or less) granted to arrangements. In response, the Corporation established an
consumer or commercial loans that were current as of the loan enterprise-wide IBOR transition program led by senior
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modification program implementation date are not TDRs. In management in early 2018. This program, which is led by the
December 2020, the Consolidated Appropriations Act amended Corporation's Chief Operating Officer, includes active
the CARES Act by extending the exemption from TDR involvement of senior management and regular reports to the
classification for COVID-19 related modifications from December Enterprise Risk Committee (ERC). The program is intended to
31, 2020 to the earlier of January 1, 2022 or 60 days after the address the Corporation's industry and regulatory engagement,
national emergency has ended. For more information, see Note client and financial contract changes, internal and external
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communications, technology and operations modifications, an effective transition to ARRs. For more information on the
introduction of new products, migration of existing clients, and expected replacement of LIBOR and other benchmark rates, see
program strategy and governance. In addition, the program is Item 1A. Risk Factors of our 2020 Annual Report on Form 10-K.
designed to monitor a variety of scenarios, including operational
risks associated with insufficient preparation by individual
U.K. Exit from the EU
market participants or the overall market ecosystem, volatility On January 31, 2020, the U.K. formally exited the European
along the Secured Overnight Financing Rate (SOFR) curve, Union (EU), and a transition period began during which time the
development and adoption of credit-sensitive and other rates, U.K. and the EU negotiated a trade agreement and other terms
associated with their future relationship. The transition period
regulatory and legal uncertainty with respect to various matters
ended on December 31, 2020.
including contract continuity, access by market participants to
We conduct business in Europe, the Middle East and Africa
liquidity in certain products, and IBOR continuity beyond
primarily through our subsidiaries in the U.K., Ireland and France
December 2021. and implemented changes to enable us to continue to operate
As of February 1, 2021, a significant majority of the in the region, including establishing a bank and broker-dealer in
aggregate notional amount of our LIBOR-based products and the EU, as well as minimize the potential for any operational
contracts maturing after 2021 include or have been updated to disruption. As the global economic impact of the U.K.’s
include fallbacks to ARRs based on market driven protocols, withdrawal from the EU remains uncertain and could result in
regulatory guidance and industry-recommended fallback regional and global financial market disruptions, we continue to
provisions and related mechanisms. For certain of the remaining assess potential operational, regulatory and legal risks. For
products and contracts, the transition will be more complex, more information, see Item 1A. Risk Factors of our 2020 Annual
particularly where there is no industry-wide protocol or similar Report on Form 10-K.
mechanism. The Corporation is executing transition plans that
are intended to be in line with applicable major industry-wide Financial Highlights
IBOR product cessation and launch milestones recommended Effective January 1, 2020, we adopted the new accounting
by the Alternative Reference Rates Committee, a group of standard on current expected credit losses (CECL), under which
private market participants and official sector entities convened the allowance is measured based on management’s best
by the Federal Reserve and the Federal Reserve Bank of New estimate of lifetime expected credit losses (ECL). Prior-year
York, and the Bank of England Sterling Risk Free Rate Working periods presented reflect measurement of the allowance based
Group, other than the cessation of LIBOR-based adjustable-rate on management’s estimate of probable incurred credit losses.
consumer mortgages. The Corporation plans to no longer offer For more information, see Note 1 – Summary of Significant
these mortgages and launch SOFR-based adjustable-rate Accounting Principles to the Consolidated Financial Statements.
consumer mortgages by the end of the first quarter of 2021.
The Corporation is executing product and client roadmaps
that it believes align with industry-recommended and regulatory Table 1 Summary Income Statement and Selected
milestones, and the Corporation has developed employee Financial Data
training programs as well as other internal and external sources (Dollars in millions, except per share information) 2020 2019
of information on the various challenges and opportunities that Income statement
the replacement of IBORs presents. As the transition to ARRs Net interest income $ 43,360 $ 48,891
evolves, the Corporation continues to monitor and participate in Noninterest income 42,168 42,353
the development and usage of certain ARRs, including SOFR, Total revenue, net of interest expense 85,528 91,244
Provision for credit losses 11,320 3,590
the Euro Short Term Rate and the Sterling Overnight Index
Noninterest expense 55,213 54,900
Average (SONIA). The Corporation’s key transition efforts to date Income before income taxes 18,995 32,754
include issuances of debt and deposits linked to SOFR and Income tax expense 1,101 5,324
SONIA by the Corporation, facilitating debt issuances linked to Net income 17,894 27,430
ARRs by clients and secondary market liquidity for products Preferred stock dividends 1,421 1,432
linked to ARRs, originating and arranging loans linked to ARRs, Net income applicable to common
shareholders $ 16,473 $ 25,998
including hedging arrangements, executing, trading, market
making and clearing ARR-based derivatives, and launching
Per common share information
capabilities and services to support the issuance and trading in Earnings $ 1.88 $ 2.77
products indexed to certain ARRs. The Corporation updated its Diluted earnings 1.87 2.75
operational models, systems, procedures and internal Dividends paid 0.72 0.66
infrastructure in connection with the transition to ARRs by the Performance ratios
Return on average assets (1) 0.67 % 1.14 %
central clearing counterparties. In October 2020, the
Return on average common shareholders’
Corporation and certain of its subsidiaries adhered to the equity (1) 6.76 10.62
International Swaps and Derivatives Association, Inc. 2020 Return on average tangible common
IBOR Fallbacks Protocol, effective January 25, 2021, which shareholders’ equity (2) 9.48 14.86
provides a mechanism to enable market participants to Efficiency ratio (1) 64.55 60.17
incorporate fallbacks for certain legacy non-cleared derivatives Balance sheet at year end
Total loans and leases $ 927,861 $ 983,426
linked to certain IBORs. 2,819,627 2,434,079
Total assets
Additionally, the Corporation is continuing to evaluate Total deposits 1,795,480 1,434,803
potential regulatory, tax and accounting impacts of the
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Total liabilities 2,546,703 2,169,269

transition, including guidance published and/or proposed by the Total common shareholders’ equity 248,414 241,409
Total shareholders’ equity 272,924 264,810
Internal Revenue Service and Financial Accounting Standards (1)
For definitions, see Key Metrics on page 196.
Board, engage impacted clients in connection with the transition (2)
Return on average tangible common shareholders’ equity is a non-GAAP financial measure.
to ARRs and work actively with global regulators, industry For more information and a corresponding reconciliation to the most closely related financial
measures defined by accounting principles generally accepted in the United States of
working groups and trade associations to develop strategies for America, see Non-GAAP Reconciliations on page 111.

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Net income was $17.9 billion or $1.87 per diluted share in • Investment banking fees increased $1.5 billion primarily
2020 compared to $27.4 billion or $2.75 per diluted share in driven by higher equity issuance fees.
2019. The decline in net income was primarily due to higher • Market making and similar activities decreased $679 million
provision for credit losses driven by the weaker economic primarily due to the impact of lower U.S. interest rates on
outlook related to COVID-19 and lower net interest income. certain risk management derivatives, partially offset by
For discussion and analysis of our consolidated and increased client activity and strong trading performance in
business segment results of operations for 2019 compared to fixed income, currencies and commodities (FICC).
2018, see the Financial Highlights and Business Segment • Other income decreased $1.0 billion primarily due to lower
Operations sections in the MD&A of the Corporation's 2019 equity investment income, higher partnership losses on tax
Annual Report on Form 10-K. credit investments, primarily affordable housing and
renewable energy, partially offset by higher gains on loan
Net Interest Income sales and sales of debt securities.
Net interest income decreased $5.5 billion to $43.4 billion in
2020 compared to 2019. Net interest yield on a fully taxable- Provision for Credit Losses
equivalent (FTE) basis decreased 53 basis points (bps) to 1.90 The provision for credit losses increased $7.7 billion to $11.3
percent for 2020. The decrease in net interest income was billion in 2020 compared to 2019 primarily driven by higher ECL
primarily driven by lower interest rates, partially offset by due to a weaker economic outlook related to COVID-19. For
reduced deposit and funding costs, the deployment of excess more information on the provision for credit losses, see
deposits into securities and an additional day of interest Allowance for Credit Losses on page 99.
accrual. Assuming continued economic improvement and based
on the forward interest rate curve as of January 19, 2021, when Noninterest Expense
we announced quarterly and annual results for the periods
ended December 31, 2020, we expect net interest income to be
higher in the second half of 2021 as compared to both the Table 3 Noninterest Expense
second half of 2020 and the first half of 2021. For more
information on net interest yield and the FTE basis, see (Dollars in millions) 2020 2019
Supplemental Financial Data on page 54, and for more Compensation and benefits $ 32,725 $ 31,977
information on interest rate risk management, see Interest Rate Occupancy and equipment 7,141 6,588
Information processing and communications 5,222 4,646
Risk Management for the Banking Book on page 105.
Product delivery and transaction related 3,433 2,762
Noninterest Income Marketing 1,701 1,934
Professional fees 1,694 1,597
Other general operating 3,297 5,396
Total noninterest expense $ 55,213 $ 54,900
Table 2 Noninterest Income
Noninterest expense increased $313 million to $55.2 billion in
(Dollars in millions) 2020 2019
2020 compared to 2019. The increase was primarily due to
Fees and commissions:
Card income $ 5,656 $ 5,797
higher operating costs related to COVID-19, merchant services
Service charges 7,141 7,674 expenses, which were previously recorded in other income as
Investment and brokerage services 14,574 13,902 part of joint venture net earnings, and higher activity-based
Investment banking fees 7,180 5,642 expenses due to increased client activity, partially offset by a
Total fees and commissions 34,551 33,015 $2.1 billion pretax impairment charge related to the notice of
Market making and similar activities 8,355 9,034 termination of the merchant services joint venture in 2019.
Other income (738) 304
Total noninterest income $ 42,168 $ 42,353 Income Tax Expense
Noninterest income decreased $185 million to $42.2 billion in
2020 compared to 2019. The following highlights the significant Table 4 Income Tax Expense
changes.
• Card income decreased $141 million primarily due to lower (Dollars in millions) 2020 2019
levels of consumer spending driven by the impact of Income before income taxes $ 18,995 $ 32,754
COVID-19, partially offset by higher income related to the Income tax expense 1,101 5,324
Effective tax rate 5.8 % 16.3 %
processing of unemployment insurance.
• Service charges decreased $533 million primarily due to
Income tax expense was $1.1 billion for 2020 compared to
higher deposit balances and lower client activity due to the
$5.3 billion in 2019, resulting in an effective tax rate of 5.8
impact of COVID-19.
percent compared to 16.3 percent.
• Investment and brokerage services income increased $672
million primarily due to higher client transactional activity,
higher market valuations and assets under management
(AUM) flows, partially offset by declines in AUM pricing.
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The change in the effective tax rate for 2020 was driven by earnings, and requires a reversal of the adjustment to the U.K.
the impact of our recurring tax preference benefits on lower net deferred tax assets recognized at the time the tax rate
levels of pretax income. These benefits primarily consist of tax decreases were originally enacted. Accordingly, during the third
credits from environmental, social and governance (ESG) quarter of 2020, the Corporation recorded an income tax benefit
investments in affordable housing and renewable energy, of approximately $700 million along with a corresponding
aligning with our responsible growth strategy to address global increase to the U.K. net deferred tax assets.
sustainability challenges. Excluding tax credits related to our The effective tax rate for 2019 included net tax benefits
ESG investment activity, the effective tax rate for 2020 would primarily related to the resolution of various tax controversy
have been 21 percent. matters.
The 2020 rate also included the impact of the U.K. tax law Absent unusual items, we expect the effective tax rate for
change, whereby on July 22, 2020, the U.K. enacted a repeal of 2021 to be in the range of 10 – 12 percent, reflecting tax
the final two percent of scheduled decreases in the U.K. credits related to our ESG investment activity.
corporation tax rate, which had been previously enacted. This
change will unfavorably affect income tax expense on future U.K.
Balance Sheet Overview
Table 5 Selected Balance Sheet Data

December 31
(Dollars in millions) 2020 2019 % Change
Assets
Cash and cash equivalents $ 380,463 $ 161,560 135 %
Federal funds sold and securities borrowed or purchased under agreements to resell 304,058 274,597 11
Trading account assets 198,854 229,826 (13)
Debt securities 684,850 472,197 45
Loans and leases 927,861 983,426 (6)
Allowance for loan and lease losses (18,802) (9,416) 100
All other assets 342,343 321,889 6
Total assets $ 2,819,627 $ 2,434,079 16
Liabilities
Deposits $ 1,795,480 $ 1,434,803 25
Federal funds purchased and securities loaned or sold under agreements to repurchase 170,323 165,109 3
Trading account liabilities 71,320 83,270 (14)
Short-term borrowings 19,321 24,204 (20)
Long-term debt 262,934 240,856 9
All other liabilities 227,325 221,027 3
Total liabilities 2,546,703 2,169,269 17
Shareholders’ equity 272,924 264,810 3
Total liabilities and shareholders’ equity $ 2,819,627 $ 2,434,079 16
Assets Trading Account Assets

At December 31, 2020, total assets were approximately $2.8 Trading account assets consist primarily of long positions in
trillion, up $385.5 billion from December 31, 2019. The equity and fixed-income securities including U.S. government
increase in assets was primarily due to higher cash held at and agency securities, corporate securities and non-U.S.
central banks that was primarily funded by deposit growth and sovereign debt. Trading account assets decreased $31.0 billion
debt securities, partially offset by a decline in loans and leases. due to a decline in inventory within Global Markets.
Cash and Cash Equivalents Debt Securities

Cash and cash equivalents increased $218.9 billion driven by Debt securities primarily include U.S. Treasury and agency
deposit growth. securities, mortgage-backed securities (MBS), principally agency
MBS, non-U.S. bonds, corporate bonds and municipal debt. We
Federal Funds Sold and Securities Borrowed or Purchased use the debt securities portfolio primarily to manage interest
Under Agreements to Resell rate and liquidity risk and to take advantage of market
Federal funds transactions involve lending reserve balances on conditions that create economically attractive returns on these
a short-term basis. Securities borrowed or purchased under investments. Debt securities increased $212.7 billion primarily
agreements to resell are collateralized lending transactions driven by the deployment of deposit inflows. For more
utilized to accommodate customer transactions, earn interest information on debt securities, see Note 4 – Securities to the
rate spreads, and obtain securities for settlement and for Consolidated Financial Statements.
collateral. Federal funds sold and securities borrowed or
purchased under agreements to resell increased $29.5 billion
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Loans and Leases Short-term Borrowings

Loans and leases decreased $55.6 billion primarily driven by Short-term borrowings provide an additional funding source and
commercial loan paydowns, lower credit card spending and primarily consist of Federal Home Loan Bank (FHLB) short-term
lower residential mortgages due to higher paydowns and a borrowings, notes payable and various other borrowings that
decline in originations. For more information on the loan generally have maturities of one year or less. Short-term
portfolio, see Credit Risk Management on page 84. borrowings decreased $4.9 billion due to higher deposit levels.
For more information on short-term borrowings, see Note 10 –
Allowance for Loan and Lease Losses Federal Funds Sold or Purchased, Securities Financing
The allowance for loan and lease losses increased $9.4 billion Agreements, Short-term Borrowings and Restricted Cash to the
primarily due to the weaker economic outlook related to Consolidated Financial Statements.
COVID-19 and the impact of the adoption of the new credit loss
accounting standard. For more information, see Allowance for Long-term Debt
Credit Losses on page 99. Long-term debt increased $22.1 billion primarily due to debt
issuances and valuation adjustments, partially offset by
Liabilities maturities and redemptions. For more information on long-term
At December 31, 2020, total liabilities were approximately $2.5 debt, see Note 11 – Long-term Debt to the Consolidated
trillion, up $377.4 billion from December 31, 2019, primarily Financial Statements.
due to deposit growth.
Shareholders’ Equity
Deposits Shareholders’ equity increased $8.1 billion driven by net
Deposits increased $360.7 billion primarily due to an increase income, market value increases on debt securities and
in retail and wholesale deposits. issuances of preferred and common stock, partially offset by the
Federal Funds Purchased and Securities Loaned or Sold return of capital to shareholders totaling $14.7 billion through
share repurchases and common and preferred stock dividends,
Under Agreements to Repurchase
as well as the impact of the adoption of the new credit loss
Federal funds transactions involve borrowing reserve balances
accounting standard and the redemption of preferred stock.
on a short-term basis. Securities loaned or sold under
agreements to repurchase are collateralized borrowing Cash Flows Overview
transactions utilized to accommodate customer transactions,
The Corporation’s operating assets and liabilities support our
earn interest rate spreads and finance assets on the balance
global markets and lending activities. We believe that cash
sheet. Federal funds purchased and securities loaned or sold
under agreements to repurchase increased $5.2 billion primarily flows from operations, available cash balances and our ability to
driven by client activity within Global Markets. generate cash through short- and long-term debt are sufficient to
fund our operating liquidity needs. Our investing activities
Trading Account Liabilities primarily include the debt securities portfolio and loans and
Trading account liabilities consist primarily of short positions in leases. Our financing activities reflect cash flows primarily
equity and fixed-income securities including U.S. Treasury and related to customer deposits, securities financing agreements
agency securities, corporate securities and non-U.S. sovereign and long-term debt. For more information on liquidity, see
debt. Trading account liabilities decreased $12.0 billion Liquidity Risk on page 80.
primarily due to lower levels of short positions within Global
Markets.
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Supplemental Financial Data shareholders’ equity as key measures to support our overall
growth objectives. These ratios are as follows:
Non-GAAP Financial Measures
• Return on average tangible common shareholders’ equity
In this Form 10-K, we present certain non-GAAP financial
measures our net income applicable to common
measures. Non-GAAP financial measures exclude certain items
shareholders as a percentage of adjusted average common
or otherwise include components that differ from the most
shareholders’ equity. The tangible common equity ratio
directly comparable measures calculated in accordance with
represents adjusted ending common shareholders’ equity
GAAP. Non-GAAP financial measures are provided as additional
divided by total tangible assets.
useful information to assess our financial condition, results of
• Return on average tangible shareholders' equity measures
operations (including period-to-period operating performance) or
our net income as a percentage of adjusted average total
compliance with prospective regulatory requirements. These
shareholders’ equity. The tangible equity ratio represents
non-GAAP financial measures are not intended as a substitute
adjusted ending shareholders’ equity divided by total
for GAAP financial measures and may not be defined or
tangible assets.
calculated the same way as non-GAAP financial measures used
• Tangible book value per common share represents adjusted
by other companies.
ending common shareholders’ equity divided by ending
We view net interest income and related ratios and analyses
common shares outstanding.
on an FTE basis, which when presented on a consolidated basis
are non-GAAP financial measures. To derive the FTE basis, net We believe ratios utilizing tangible equity provide additional
interest income is adjusted to reflect tax-exempt income on an useful information because they present measures of those
equivalent before-tax basis with a corresponding increase in assets that can generate income. Tangible book value per
income tax expense. For purposes of this calculation, we use common share provides additional useful information about the
the federal statutory tax rate of 21 percent and a representative level of tangible assets in relation to outstanding shares of
state tax rate. Net interest yield, which measures the basis common stock.
points we earn over the cost of funds, utilizes net interest The aforementioned supplemental data and performance
income on an FTE basis. We believe that presentation of these measures are presented in Tables 6 and 7.
items on an FTE basis allows for comparison of amounts from For more information on the reconciliation of these non-GAAP
both taxable and tax-exempt sources and is consistent with financial measures to the corresponding GAAP financial
industry practices. measures, see Non-GAAP Reconciliations on page 111.
We may present certain key performance indicators and
ratios excluding certain items (e.g., debit valuation adjustment Key Performance Indicators
(DVA) gains (losses)) which result in non-GAAP financial We present certain key financial and nonfinancial performance
measures. We believe that the presentation of measures that indicators (key performance indicators) that management uses
exclude these items is useful because such measures provide when assessing our consolidated and/or segment results. We
additional information to assess the underlying operational believe they are useful to investors because they provide
performance and trends of our businesses and to allow better additional information about our underlying operational
comparison of period-to-period operating performance. performance and trends. These key performance indicators
We also evaluate our business based on certain ratios that (KPIs) may not be defined or calculated in the same way as
utilize tangible equity, a non-GAAP financial measure. Tangible similar KPIs used by other companies. For information on how
equity represents shareholders’ equity or common these metrics are defined, see Key Metrics on page 196.
shareholders’ equity reduced by goodwill and intangible assets Our consolidated key performance indicators, which include
(excluding mortgage servicing rights (MSRs)), net of related various equity and credit metrics, are presented in Table 1 on
deferred tax liabilities ("adjusted" shareholders' equity or page 50 and/or Tables 6 and 7 on pages 55 and 56.
common shareholders' equity). These measures are used to For information on key segment performance metrics, see
evaluate our use of equity. In addition, profitability, relationship Business Segment Operations on page 59.
and investment models use both return on average tangible
common shareholders’ equity and return on average tangible
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Table 6 Five-year Summary of Selected Financial Data

(In millions, except per share information) 2020 2019 2018 2017 2016
Income statement
Net interest income $ 43,360 $ 48,891 $ 48,162 $ 45,239 $ 41,486
Noninterest income 42,168 42,353 42,858 41,887 42,012
Total revenue, net of interest expense 85,528 91,244 91,020 87,126 83,498
Provision for credit losses 11,320 3,590 3,282 3,396 3,597
Noninterest expense 55,213 54,900 53,154 54,517 54,880
Income before income taxes 18,995 32,754 34,584 29,213 25,021
Income tax expense 1,101 5,324 6,437 10,981 7,199
Net income 17,894 27,430 28,147 18,232 17,822
Net income applicable to common shareholders 16,473 25,998 26,696 16,618 16,140
Average common shares issued and outstanding 8,753.2 9,390.5 10,096.5 10,195.6 10,248.1
Average diluted common shares issued and outstanding 8,796.9 9,442.9 10,236.9 10,778.4 11,046.8
Performance ratios
Return on average assets (1) 0.67 % 1.14 % 1.21 % 0.80 % 0.81 %
Return on average common shareholders’ equity (1) 6.76 10.62 11.04 6.72 6.69
Return on average tangible common shareholders’ equity (2) 9.48 14.86 15.55 9.41 9.51
Return on average shareholders’ equity (1) 6.69 10.24 10.63 6.72 6.70
Return on average tangible shareholders’ equity (2) 9.07 13.85 14.46 9.08 9.17
Total ending equity to total ending assets 9.68 10.88 11.27 11.71 12.17
Total average equity to total average assets 9.96 11.14 11.39 11.96 12.14
Dividend payout 38.18 23.65 20.31 24.24 15.94
Per common share data
Earnings $ 1.88 $ 2.77 $ 2.64 $ 1.63 $ 1.57
Diluted earnings 1.87 2.75 2.61 1.56 1.49
Dividends paid 0.72 0.66 0.54 0.39 0.25
Book value (1) 28.72 27.32 25.13 23.80 23.97
Tangible book value (2) 20.60 19.41 17.91 16.96 16.89
Market capitalization $ 262,206 $ 311,209 $ 238,251 $ 303,681 $ 222,163
Average balance sheet
Total loans and leases $ 982,467 $ 958,416 $ 933,049 $ 918,731 $ 900,433
Total assets 2,683,122 2,405,830 2,325,246 2,268,633 2,190,218
Total deposits 1,632,998 1,380,326 1,314,941 1,269,796 1,222,561
Long-term debt 220,440 201,623 200,399 194,882 204,826
Common shareholders’ equity 243,685 244,853 241,799 247,101 241,187
Total shareholders’ equity 267,309 267,889 264,748 271,289 265,843
Asset quality (3)
Allowance for credit losses (4) $ 20,680 $ 10,229 $ 10,398 $ 11,170 $ 11,999
Nonperforming loans, leases and foreclosed properties (5) 5,116 3,837 5,244 6,758 8,084
Allowance for loan and lease losses as a percentage of total loans and leases
outstanding (5) 2.04 % 0.97 % 1.02 % 1.12 % 1.26 %
Allowance for loan and lease losses as a percentage of total nonperforming loans
and leases (5) 380 265 194 161 149
Net charge-offs $ 4,121 $ 3,648 $ 3,763 $ 3,979 $ 3,821
Net charge-offs as a percentage of average loans and leases outstanding (5) 0.42 % 0.38 % 0.41 % 0.44 % 0.43 %
Capital ratios at year end (6)
Common equity tier 1 capital 11.9 % 11.2 % 11.6 % 11.5 % 10.8 %
Tier 1 capital 13.5 12.6 13.2 13.0 12.4
Total capital 16.1 14.7 15.1 14.8 14.2
Tier 1 leverage 7.4 7.9 8.4 8.6 8.8
Supplementary leverage ratio 7.2 6.4 6.8 n/a n/a
Tangible equity (2) 7.4 8.2 8.6 8.9 9.2
Tangible common equity (2) 6.5 7.3 7.6 7.9 8.0
(1)
For definitions, see Key Metrics on page 196
(2)
Tangible equity ratios and tangible book value per share of common stock are non-GAAP financial measures. For more information on these ratios and corresponding reconciliations to GAAP
financial measures, see Supplemental Financial Data on page 54 and Non-GAAP Reconciliations on page 111.
(3)
Asset quality metrics include $75 million of non-U.S. consumer credit card net charge-offs in 2017 and $243 million of non-U.S. consumer credit card allowance for loan and lease losses, $9.2
billion of non-U.S. consumer credit card loans and $175 million of non-U.S. consumer credit card net charge-offs in 2016. The Corporation sold its non-U.S. consumer credit card business in
2017.
(4)
Includes the allowance for loan and leases losses and the reserve for unfunded lending commitments.
(5)
Balances and ratios do not include loans accounted for under the fair value option. For additional exclusions from nonperforming loans, leases and foreclosed properties, see Consumer Portfolio
Credit Risk Management – Nonperforming Consumer Loans, Leases and Foreclosed Properties Activity on page 90 and corresponding Table 28 and Commercial Portfolio Credit Risk Management
– Nonperforming Commercial Loans, Leases and Foreclosed Properties Activity on page 94 and corresponding Table 35.
(6)
Basel 3 transition provisions for regulatory capital adjustments and deductions were fully phased-in as of January 1, 2018. Prior periods are presented on a fully phased-in basis. For additional
information, including which approach is used to assess capital adequacy, see Capital Management on page 73.
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Table 7 Selected Quarterly Financial Data

2020 Quarters 2019 Quarters
(In millions, except per share information) Fourth Third Second First Fourth Third Second First
Income statement
Net interest income $ 10,253 $ 10,129 $ 10,848 $ 12,130 $ 12,140 $ 12,187 $ 12,189 $ 12,375
Noninterest income 9,846 10,207 11,478 10,637 10,209 10,620 10,895 10,629
Total revenue, net of interest expense 20,099 20,336 22,326 22,767 22,349 22,807 23,084 23,004
Provision for credit losses 53 1,389 5,117 4,761 941 779 857 1,013
Noninterest expense 13,927 14,401 13,410 13,475 13,239 15,169 13,268 13,224
Income before income taxes 6,119 4,546 3,799 4,531 8,169 6,859 8,959 8,767
Income tax expense 649 (335) 266 521 1,175 1,082 1,611 1,456
Net income 5,470 4,881 3,533 4,010 6,994 5,777 7,348 7,311
Net income applicable to common shareholders 5,208 4,440 3,284 3,541 6,748 5,272 7,109 6,869
Average common shares issued and outstanding 8,724.9 8,732.9 8,739.9 8,815.6 9,017.1 9,303.6 9,523.2 9,725.9
Average diluted common shares issued and outstanding 8,785.0 8,777.5 8,768.1 8,862.7 9,079.5 9,353.0 9,559.6 9,787.3
Performance ratios
Return on average assets (1) 0.78 % 0.71 % 0.53 % 0.65 % 1.13 % 0.95 % 1.23 % 1.26 %
Four-quarter trailing return on average assets (2) 0.67 0.75 0.81 0.99 1.14 1.17 1.24 1.22
Return on average common shareholders’ equity (1) 8.39 7.24 5.44 5.91 11.00 8.48 11.62 11.42
Return on average tangible common shareholders’ equity (3) 11.73 10.16 7.63 8.32 15.43 11.84 16.24 16.01
Return on average shareholders’ equity (1) 8.03 7.26 5.34 6.10 10.40 8.48 11.00 11.14
Return on average tangible shareholders’ equity (3) 10.84 9.84 7.23 8.29 14.09 11.43 14.88 15.10
Total ending equity to total ending assets 9.68 9.82 9.69 10.11 10.88 11.06 11.33 11.23
Total average equity to total average assets 9.71 9.76 9.85 10.60 10.89 11.21 11.17 11.28
Dividend payout 30.11 35.36 47.87 44.57 23.90 31.48 19.95 21.20
Per common share data
Earnings $ 0.60 $ 0.51 $ 0.38 $ 0.40 $ 0.75 $ 0.57 $ 0.75 $ 0.71
Diluted earnings 0.59 0.51 0.37 0.40 0.74 0.56 0.74 0.70
Dividends paid 0.18 0.18 0.18 0.18 0.18 0.18 0.15 0.15
Book value (1) 28.72 28.33 27.96 27.84 27.32 26.96 26.41 25.57
Tangible book value (3) 20.60 20.23 19.90 19.79 19.41 19.26 18.92 18.26
Market capitalization $ 262,206 $ 208,656 $ 205,772 $ 184,181 $ 311,209 $ 264,842 $ 270,935 $ 263,992
Average balance sheet
Total loans and leases $ 934,798 $ 974,018 $1,031,387 $ 990,283 $ 973,986 $ 964,733 $ 950,525 $ 944,020
Total assets 2,791,874 2,739,684 2,704,186 2,494,928 2,450,005 2,412,223 2,399,051 2,360,992
Total deposits 1,737,139 1,695,488 1,658,197 1,439,336 1,410,439 1,375,052 1,375,450 1,359,864
Long-term debt 225,423 224,254 221,167 210,816 206,026 202,620 201,007 196,726
Common shareholders’ equity 246,840 243,896 242,889 241,078 243,439 246,630 245,438 243,891
Total shareholders’ equity 271,020 267,323 266,316 264,534 266,900 270,430 267,975 266,217
Asset quality
Allowance for credit losses (4) $ 20,680 $ 21,506 $ 21,091 $ 17,126 $ 10,229 $ 10,242 $ 10,333 $ 10,379
Nonperforming loans, leases and foreclosed properties (5) 5,116 4,730 4,611 4,331 3,837 3,723 4,452 5,145
Allowance for loan and lease losses as a percentage of total loans
and leases outstanding (5) 2.04 % 2.07 % 1.96 % 1.51 % 0.97 % 0.98 % 1.00 % 1.02 %
Allowance for loan and lease losses as a percentage of total
nonperforming loans and leases (5) 380 431 441 389 265 271 228 197
Net charge-offs $ 881 $ 972 $ 1,146 $ 1,122 $ 959 $ 811 $ 887 $ 991
Annualized net charge-offs as a percentage of average loans and
leases outstanding (5) 0.38 % 0.40 % 0.45 % 0.46 % 0.39 % 0.34 % 0.38 % 0.43 %
Capital ratios at period end (6)
Common equity tier 1 capital 11.9 % 11.9 % 11.4 % 10.8 % 11.2 % 11.4 % 11.7 % 11.6 %
Tier 1 capital 13.5 13.5 12.9 12.3 12.6 12.9 13.3 13.1
Total capital 16.1 16.1 14.8 14.6 14.7 15.1 15.4 15.2
Tier 1 leverage 7.4 7.4 7.4 7.9 7.9 8.2 8.4 8.4
Supplementary leverage ratio 7.2 6.9 7.1 6.4 6.4 6.6 6.8 6.8
Tangible equity (3) 7.4 7.4 7.3 7.7 8.2 8.4 8.7 8.5
Tangible common equity (3) 6.5 6.6 6.5 6.7 7.3 7.4 7.6 7.6
Total loss-absorbing capacity and long-term debt metrics
Total loss-absorbing capacity to risk-weighted assets 27.4 % 26.9 % 26.0 % 24.6 % 24.6 % 24.8 % 25.5 % 24.8 %
Total loss-absorbing capacity to supplementary leverage exposure 14.5 13.7 14.2 12.8 12.5 12.7 13.0 12.8
Eligible long-term debt to risk-weighted assets 13.3 12.9 12.4 11.6 11.5 11.4 11.8 11.4
Eligible long-term debt to supplementary leverage exposure 7.1 6.6 6.7 6.1 5.8 5.8 6.0 5.9
(1)
For definitions, see Key Metrics on page 196.
(2)
Calculated as total net income for four consecutive quarters divided by annualized average assets for four consecutive quarters.
(3)
Tangible equity ratios and tangible book value per share of common stock are non-GAAP financial measures. For more information on these ratios and corresponding reconciliations to GAAP
financial measures, see Supplemental Financial Data on page 54 and Non-GAAP Reconciliations on page 111.
(4)
Includes the allowance for loan and lease losses and the reserve for unfunded lending commitments.
(5)
Balances and ratios do not include loans accounted for under the fair value option. For additional exclusions from nonperforming loans, leases and foreclosed properties, see Consumer Portfolio
Credit Risk Management – Nonperforming Consumer Loans, Leases and Foreclosed Properties Activity on page 91 and corresponding Table 28 and Commercial Portfolio Credit Risk Management
– Nonperforming Commercial Loans, Leases and Foreclosed Properties Activity on page 95 and corresponding Table 35.
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(6)
For more information, including which approach is used to assess capital adequacy, see Capital Management on page 73.

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Table 8 Average Balances and Interest Rates - FTE Basis
Interest Interest Interest

Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/
Balance Expense (1) Rate Balance Expense (1) Rate Balance Expense (1) Rate
(Dollars in millions) 2020 2019 2018
Earning assets
Interest-bearing deposits with the Federal Reserve, non-
U.S. central banks and other banks $ 253,227 $ 359 0.14 % $ 125,555 $ 1,823 1.45 % $ 139,848 $ 1,926 1.38 %
Time deposits placed and other short-term investments 8,840 29 0.33 9,427 207 2.19 9,446 216 2.29
Federal funds sold and securities borrowed or purchased
under agreements to resell 309,945 903 0.29 279,610 4,843 1.73 251,328 3,176 1.26
Trading account assets 148,076 4,185 2.83 148,076 5,269 3.56 132,724 4,901 3.69
Debt securities 532,266 9,868 1.87 450,090 11,917 2.65 437,312 11,837 2.66
Loans and leases (2)
Residential mortgage 236,719 7,338 3.10 220,552 7,651 3.47 207,523 7,294 3.51
Home equity 38,251 1,290 3.37 44,600 2,194 4.92 53,886 2,573 4.77
Credit card 85,017 8,759 10.30 94,488 10,166 10.76 94,612 9,579 10.12
Direct/Indirect and other consumer (3) 89,974 2,545 2.83 90,656 3,261 3.60 93,036 3,104 3.34
Total consumer 449,961 19,932 4.43 450,296 23,272 5.17 449,057 22,550 5.02
U.S. commercial (4) 344,095 9,712 2.82 321,467 13,161 4.09 304,387 11,937 3.92
Non-U.S. commercial (4) 106,487 2,208 2.07 103,918 3,402 3.27 97,664 3,220 3.30
(5)
Commercial real estate 63,428 1,790 2.82 62,044 2,741 4.42 60,384 2,618 4.34
Commercial lease financing 18,496 559 3.02 20,691 718 3.47 21,557 698 3.24
Total commercial 532,506 14,269 2.68 508,120 20,022 3.94 483,992 18,473 3.82
Total loans and leases 982,467 34,201 3.48 958,416 43,294 4.52 933,049 41,023 4.40
Other earning assets 83,078 2,539 3.06 69,089 4,478 6.48 76,524 4,300 5.62
Total earning assets 2,317,899 52,084 2.25 2,040,263 71,831 3.52 1,980,231 67,379 3.40
Cash and due from banks 31,885 26,193 25,830
Other assets, less allowance for loan and lease losses 333,338 339,374 319,185
Total assets $ 2,683,122 $ 2,405,830 $ 2,325,246
Interest-bearing liabilities
U.S. interest-bearing deposits
Savings $ 58,113 $ 6 0.01 % $ 52,020 $ 5 0.01 % $ 54,226 $ 6 0.01 %
Demand and money market deposit accounts 829,719 977 0.12 741,126 4,471 0.60 676,382 2,636 0.39
Consumer CDs and IRAs 47,780 405 0.85 47,577 471 0.99 39,823 157 0.39
Negotiable CDs, public funds and other deposits 64,857 323 0.50 66,866 1,407 2.11 50,593 991 1.96
Total U.S. interest-bearing deposits 1,000,469 1,711 0.17 907,589 6,354 0.70 821,024 3,790 0.46
Non-U.S. interest-bearing deposits
Banks located in non-U.S. countries 1,476 4 0.27 1,936 20 1.04 2,312 39 1.69
Governments and official institutions 184 — 0.01 181 — 0.05 810 — 0.01
Time, savings and other 75,386 228 0.30 69,351 814 1.17 65,097 666 1.02
Total non-U.S. interest-bearing deposits 77,046 232 0.30 71,468 834 1.17 68,219 705 1.03
Total interest-bearing deposits 1,077,515 1,943 0.18 979,057 7,188 0.73 889,243 4,495 0.51
Federal funds purchased, securities loaned or sold under

agreements to repurchase, short-term borrowings and
other interest-bearing liabilities 293,466 987 0.34 276,432 7,208 2.61 269,748 5,839 2.17
Trading account liabilities 41,386 974 2.35 45,449 1,249 2.75 50,928 1,358 2.67
Long-term debt 220,440 4,321 1.96 201,623 6,700 3.32 200,399 6,915 3.45
Total interest-bearing liabilities 1,632,807 8,225 0.50 1,502,561 22,345 1.49 1,410,318 18,607 1.32
Noninterest-bearing sources
Noninterest-bearing deposits 555,483 401,269 425,698
Other liabilities (6) 227,523 234,111 224,482
Shareholders’ equity 267,309 267,889 264,748
Total liabilities and shareholders’ equity $ 2,683,122 $ 2,405,830 $ 2,325,246
Net interest spread 1.75 % 2.03 % 2.08 %
Impact of noninterest-bearing sources 0.15 0.40 0.37
Net interest income/yield on earning assets (7) $ 43,859 1.90 % $ 49,486 2.43 % $ 48,772 2.45 %
(1)
Includes the impact of interest rate risk management contracts. For more information, see Interest Rate Risk Management for the Banking Book on page 105.
(2)
Nonperforming loans are included in the respective average loan balances. Income on these nonperforming loans is generally recognized on a cost recovery basis.
(3)
Includes non-U.S. consumer loans of $2.9 billion, $2.9 billion and $2.8 billion for 2020, 2019 and 2018, respectively.
(4)
Certain prior-period amounts for 2019 have been reclassified to conform to current-period presentation.
(5)
Includes U.S. commercial real estate loans of $59.8 billion, $57.3 billion and $56.4 billion, and non-U.S. commercial real estate loans of $3.6 billion, $4.7 billion and $4.0 billion for 2020, 2019
and 2018, respectively.
(6)
Includes $34.3 billion, $35.5 billion and $30.4 billion of structured notes and liabilities for 2020, 2019 and 2018, respectively.
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(7)
Net interest income includes FTE adjustments of $499 million, $595 million and $610 million for 2020, 2019 and 2018, respectively.

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Table 9 Analysis of Changes in Net Interest Income - FTE Basis

Due to Change in (1) Due to Change in (1)
Volume Rate Net Change Volume Rate Net Change
(Dollars in millions) From 2019 to 2020 From 2018 to 2019
Increase (decrease) in interest income
Interest-bearing deposits with the Federal Reserve, non-U.S. central banks and other
banks $ 1,849 $ (3,313) $ (1,464) $ (193) $ 90 $ (103)
Time deposits placed and other short-term investments (13) (165) (178) — (9) (9)
Federal funds sold and securities borrowed or purchased under agreements to resell 519 (4,459) (3,940) 347 1,320 1,667
Trading account assets 3 (1,087) (1,084) 563 (195) 368
Debt securities 2,188 (4,237) (2,049) 135 (55) 80
Loans and leases
Residential mortgage 563 (876) (313) 447 (90) 357
Home equity (312) (592) (904) (446) 67 (379)
Credit card (1,018) (389) (1,407) (17) 604 587
Direct/Indirect and other consumer (22) (694) (716) (76) 233 157
Total consumer (3,340) 722
U.S. commercial (2) 912 (4,361) (3,449) 665 559 1,224
Non-U.S. commercial (2) 80 (1,274) (1,194) 209 (27) 182
Commercial real estate 63 (1,014) (951) 75 48 123
Commercial lease financing (76) (83) (159) (28) 48 20
Total commercial (5,753) 1,549
Total loans and leases (9,093) 2,271
Other earning assets 905 (2,844) (1,939) (417) 595 178
Net increase (decrease) in interest income $ (19,747) $ 4,452
Increase (decrease) in interest expense
U.S. interest-bearing deposits
Savings $ 1 $ — $ 1 $ (1) $ — $ (1)
Demand and money market deposit accounts 507 (4,001) (3,494) 254 1,581 1,835
Consumer CDs and IRAs 2 (68) (66) 29 285 314
Negotiable CDs, public funds and other deposits (39) (1,045) (1,084) 320 96 416
Total U.S. interest-bearing deposits (4,643) 2,564
Non-U.S. interest-bearing deposits
Banks located in non-U.S. countries (5) (11) (16) (6) (13) (19)
Time, savings and other 68 (654) (586) 41 107 148
Total non-U.S. interest-bearing deposits (602) 129
Total interest-bearing deposits (5,245) 2,693
Federal funds purchased, securities loaned or sold under agreements to repurchase,
short-term borrowings and other interest-bearing liabilities 451 (6,672) (6,221) 160 1,209 1,369
Trading account liabilities (111) (164) (275) (145) 36 (109)
Long-term debt 619 (2,998) (2,379) 41 (256) (215)
Net increase (decrease) in interest expense (14,120) 3,738
Net increase (decrease) in net interest income (3) $ (5,627) $ 714
(1)
The changes for each category of interest income and expense are divided between the portion of change attributable to the variance in volume and the portion of change attributable to the
variance in rate for that category. The unallocated change in rate or volume variance is allocated between the rate and volume variances.
(2)
Certain prior-period amounts have been reclassified to conform to current-period presentation.
(3)
Includes changes in FTE basis adjustments of a $96 million decrease from 2019 to 2020 and a $15 million decrease from 2018 to 2019.
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Business Segment Operations

Segment Description and Basis of Presentation
We report our results of operations through four business segments: Consumer Banking, GWIM, Global Banking and Global Markets,
with the remaining operations recorded in All Other. We manage our segments and report their results on an FTE basis. The primary
activities, products and businesses of the business segments and All Other are shown below.
We periodically review capital allocated to our businesses For more information on our presentation of financial
and allocate capital annually during the strategic and capital information on an FTE basis, see Supplemental Financial Data
planning processes. We utilize a methodology that considers the on page 54, and for reconciliations to consolidated total
effect of regulatory capital requirements in addition to internal revenue, net income and period-end total assets, see Note 23 –
risk-based capital models. Our internal risk-based capital Business Segment Information to the Consolidated Financial
models use a risk-adjusted methodology incorporating each Statements.
segment’s credit, market, interest rate, business and
operational risk components. For more information on the Key Performance Indicators
nature of these risks, see Managing Risk on page 70. The We present certain key financial and nonfinancial performance
capital allocated to the business segments is referred to as indicators that management uses when evaluating segment
allocated capital. Allocated equity in the reporting units is results. We believe they are useful to investors because they
comprised of allocated capital plus capital for the portion of provide additional information about our segments’ operational
goodwill and intangibles specifically assigned to the reporting performance, customer trends and business growth.
unit. For more information, including the definition of a reporting
unit, see Note 7 – Goodwill and Intangible Assets to the
Consolidated Financial Statements.
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Consumer Banking
Deposits Consumer Lending Total Consumer Banking

(Dollars in millions) 2020 2019 2020 2019 2020 2019 % Change
Net interest income $ 13,739 $ 16,904 $ 10,959 $ 11,254 $ 24,698 $ 28,158 (12)%
Noninterest income:
Card income (20) (33) 4,693 5,117 4,673 5,084 (8)
Service charges 3,416 4,216 1 2 3,417 4,218 (19)
All other income 310 833 164 294 474 1,127 (58)
Total noninterest income 3,706 5,016 4,858 5,413 8,564 10,429 (18)
Total revenue, net of interest expense 17,445 21,920 15,817 16,667 33,262 38,587 (14)
Provision for credit losses 379 269 5,386 3,503 5,765 3,772 53
Noninterest expense 11,508 10,718 7,370 6,928 18,878 17,646 7
Income before income taxes 5,558 10,933 3,061 6,236 8,619 17,169 (50)
Income tax expense 1,362 2,679 750 1,528 2,112 4,207 (50)
Net income $ 4,196 $ 8,254 $ 2,311 $ 4,708 $ 6,507 $ 12,962 (50)
(1)
Net interest yield 1.69 % 2.40 % 3.53 % 3.80 % 2.88 3.81

Return on average allocated capital 35 69 9 19 17 35
Efficiency ratio 65.97 48.90 46.60 41.56 56.76 45.73
Balance Sheet
Average
Total loans and leases $ 5,144 $ 5,371 $ 310,436 $ 295,562 $ 315,580 $ 300,933 5%
Total earning assets (2) 813,779 703,481 310,862 296,051 858,724 738,807 16
Total assets (2) 849,924 735,298 314,599 306,169 898,606 780,742 15
Total deposits 816,968 702,972 6,698 5,368 823,666 708,340 16
Allocated capital 12,000 12,000 26,500 25,000 38,500 37,000 4
Year end
Total loans and leases $ 4,673 $ 5,467 $ 295,261 $ 311,942 $ 299,934 $ 317,409 (6)%
Total earning assets (2) 899,951 724,573 295,627 312,684 945,343 760,174 24
Total assets (2) 939,629 758,459 299,186 322,717 988,580 804,093 23
Total deposits 906,092 725,665 6,560 5,080 912,652 730,745 25
(1)
Estimated at the segment level only.
(2)
In segments and businesses where the total of liabilities and equity exceeds assets, we allocate assets from All Other to match the segments’ and businesses’ liabilities and allocated
shareholders’ equity. As a result, total earning assets and total assets of the businesses may not equal total Consumer Banking.
Consumer Banking, which is comprised of Deposits and primarily due to lower rates, partially offset by the benefit of
Consumer Lending, offers a diversified range of credit, banking higher deposit and loan balances. Noninterest income
and investment products and services to consumers and small decreased $1.9 billion to $8.6 billion driven by a decline in
businesses. Deposits and Consumer Lending include the net service charges primarily due to higher deposit balances and
impact of migrating customers and their related deposit, lower card income due to decreased client activity, as well as
brokerage asset and loan balances between Deposits, lower other income due to the allocation of asset and liability
Consumer Lending and GWIM, as well as other client-managed management (ALM) results.
businesses. Our customers and clients have access to a coast The provision for credit losses increased $2.0 billion to $5.8
to coast network including financial centers in 38 states and the billion primarily due to the weaker economic outlook related to
District of Columbia. Our network includes approximately 4,300 COVID-19. Noninterest expense increased $1.2 billion to $18.9
financial centers, approximately 17,000 ATMS, nationwide call billion primarily driven by incremental expense to support
centers and leading digital banking platforms with more than customers and employees during the pandemic, as well as the
39 million active users, including approximately 31 million cost of increased client activity and continued investments for
active mobile users. business growth, including the merchant services platform.
The return on average allocated capital was 17 percent,
Consumer Banking Results. down from 35 percent, driven by lower net income and, to a
Net income for Consumer Banking decreased $6.5 billion to lesser extent, an increase in allocated capital. For information
$6.5 billion in 2020 compared to 2019 primarily due to lower on capital allocated to the business segments, see Business
revenue, higher provision for credit losses and higher expenses. Segment Operations on page 59.
Net interest income decreased $3.5 billion to $24.7 billion
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Deposits The following table provides key performance indicators for

Deposits includes the results of consumer deposit activities Deposits. Management uses these metrics, and we believe they
which consist of a comprehensive range of products provided to are useful to investors because they provide additional
consumers and small businesses. Our deposit products include information to evaluate our deposit profitability and digital/
traditional savings accounts, money market savings accounts, mobile trends.
CDs and IRAs, and noninterest- and interest-bearing checking
accounts, as well as investment accounts and products. Net Key Statistics – Deposits
interest income is allocated to the deposit products using our
2020 2019
funds transfer pricing process that matches assets and
Total deposit spreads (excludes noninterest costs) (1) 1.94% 2.34%
liabilities with similar interest rate sensitivity and maturity
characteristics. Deposits generates fees such as account Year End
service fees, non-sufficient funds fees, overdraft charges and Consumer investment assets (in millions) (2) $306,104 $240,132
ATM fees, as well as investment and brokerage fees from Merrill Active digital banking users (units in thousands) (3) 39,315 38,266
Edge accounts. Merrill Edge is an integrated investing and Active mobile banking users (units in thousands) (4) 30,783 29,174
banking service targeted at customers with less than $250,000 Financial centers 4,312 4,300
in investable assets. Merrill Edge provides investment advice ATMs 16,904 16,788
and guidance, client brokerage asset services, a self-directed (1)
(2)
Includes deposits held in Consumer Lending.
Includes client brokerage assets, deposit sweep balances and AUM in Consumer Banking.
online investing platform and key banking capabilities including (3)
Active digital banking users represents mobile and/or online users at period end.
access to the Corporation’s network of financial centers and (4)
Active mobile banking users represents mobile users at period end.
ATMs. Consumer investment assets increased $66.0 billion in

Net income for Deposits decreased $4.1 billion to $4.2 2020 driven by market performance and client flows. Active
billion primarily driven by lower revenue. Net interest income mobile banking users increased approximately two million
declined $3.2 billion to $13.7 billion primarily due to lower reflecting continuing changes in our customers’ banking
interest rates, partially offset by the benefit of growth in preferences. We had a net increase of 12 financial centers as
deposits. Noninterest income decreased $1.3 billion to $3.7 we continued to optimize our consumer banking network.
billion primarily driven by lower service charges due to higher
deposit balances and lower client activity related to the impact Consumer Lending
of COVID-19, as well as lower other income due to the allocation Consumer Lending offers products to consumers and small
of ALM results. businesses across the U.S. The products offered include credit
The provision for credit losses increased $110 million to and debit cards, residential mortgages and home equity loans,
$379 million in 2020 due to the weaker economic outlook and direct and indirect loans such as automotive, recreational
related to COVID-19. Noninterest expense increased $790 vehicle and consumer personal loans. In addition to earning net
million to $11.5 billion driven by continued investments in the interest spread revenue on its lending activities, Consumer
business and incremental expense to support customers and Lending generates interchange revenue from credit and debit
employees during the pandemic. card transactions, late fees, cash advance fees, annual credit
Average deposits increased $114.0 billion to $817.0 billion card fees, mortgage banking fee income and other
in 2020 driven by strong organic growth of $79.3 billion in miscellaneous fees. Consumer Lending products are available
checking and time deposits and $34.4 billion in traditional to our customers through our retail network, direct telephone,
savings and money market savings. and online and mobile channels. Consumer Lending results also
include the impact of servicing residential mortgages and home
equity loans in the core portfolio, including loans held on the
balance sheet of Consumer Lending and loans serviced for
others.
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Net income for Consumer Lending was $2.3 billion, a During 2020, the total risk-adjusted margin increased 88
decrease of $2.4 billion, primarily due to higher provision for bps compared to 2019 driven by a lower mix of customer
credit losses. Net interest income declined $295 million to balances at promotional rates, the lower interest rate
$11.0 billion primarily due to lower interest rates, partially offset environment and lower net credit losses. Total credit card
by loan growth. Noninterest income decreased $555 million to purchase volumes declined $26.3 billion to $251.6 billion. The
$4.9 billion primarily driven by lower card income due to lower decline in credit card purchase volumes was driven by the
client activity, as well as lower other income due to the impact of COVID-19. While overall spending improved during the
allocation of ALM results. second half of 2020, spending for travel and entertainment
The provision for credit losses increased $1.9 billion to $5.4 remained lower compared to 2019. During 2020, debit card
billion primarily due to the weaker economic outlook related to purchase volumes increased $23.8 billion to $384.5 billion,
COVID-19. Noninterest expense increased $442 million to $7.4 despite COVID-19 impacts. Debit card purchase volumes
billion primarily driven by investments in the business and improved in the second half of 2020 as businesses reopened
incremental expense to support customers and employees and spending improved.
during the pandemic.
Average loans increased $14.9 billion to $310.4 billion
Key Statistics – Residential Mortgage Loan Production (1)
primarily driven by an increase in residential mortgages and PPP
loans, partially offset by a decline in credit cards. (Dollars in millions) 2020 2019
The following table provides key performance indicators for Consumer Banking:
Consumer Lending. Management uses these metrics, and we First mortgage $ 43,197 $ 49,179
believe they are useful to investors because they provide Home equity 6,930 9,755
additional information about loan growth and profitability. Total (2):
First mortgage $ 69,086 $ 72,467
Home equity 8,160 11,131
Key Statistics – Consumer Lending (1)
The loan production amounts represent the unpaid principal balance of loans and, in the
case of home equity, the principal amount of the total line of credit.
(2)
(Dollars in millions) 2020 2019 In addition to loan production in Consumer Banking, there is also first mortgage and home
equity loan production in GWIM.
Total credit card (1)
Gross interest yield (2) 10.27 % 10.76 % First mortgage loan originations in Consumer Banking and for
Risk-adjusted margin (3) 9.16 8.28
the total Corporation decreased $6.0 billion and $3.4 billion in
New accounts (in thousands) 2,505 4,320
2020 primarily driven by a decline in nonconforming
Purchase volumes $ 251,599 $ 277,852
Debit card purchase volumes $ 384,503 $ 360,672
applications.
(1)
Home equity production in Consumer Banking and for the
Includes GWIM's credit card portfolio.
(2)
Calculated as the effective annual percentage rate divided by average loans. total Corporation decreased $2.8 billion and $3.0 billion in
2020 primarily driven by a decline in applications.
(3)
Calculated as the difference between total revenue, net of interest expense, and net credit
losses divided by average loans.
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Global Wealth & Investment Management

Net interest income $ 5,468 $ 6,504 (16)%
Noninterest income:
Investment and brokerage services 12,270 11,870 3
All other income 846 1,164 (27)
Total noninterest income 13,116 13,034 1
Total revenue, net of interest expense 18,584 19,538 (5)
Provision for credit losses 357 82 n/m

Noninterest expense 14,154 13,825 2
Income before income taxes 4,073 5,631 (28)
Income tax expense 998 1,380 (28)
Net income $ 3,075 $ 4,251 (28)
Net interest yield 1.73 2.33

Return on average allocated capital 21 29
Efficiency ratio 76.16 70.76
Balance Sheet
Average
Total loans and leases $ 183,402 $ 168,910 9%
Total earning assets 316,008 279,681 13
Total assets 328,384 292,016 12
Total deposits 287,123 256,516 12
Allocated capital 15,000 14,500 3
Year end
Total assets 369,736 299,770 23
Total deposits 322,157 263,113 22
n/m = not meaningful
GWIM consists of two primary businesses: Merrill Lynch Global Noninterest income, which primarily includes investment and
Wealth Management (MLGWM) and Bank of America Private brokerage services income, increased $82 million to $13.1
Bank. billion primarily due to higher market valuations and positive
MLGWM's advisory business provides a high-touch client AUM flows, largely offset by declines in AUM pricing as well as
experience through a network of financial advisors focused on lower other income due to the allocation of ALM results.
clients with over $250,000 in total investable assets. MLGWM The provision for credit losses increased $275 million to
provides tailored solutions to meet clients' needs through a full $357 million primarily due to the weaker economic outlook
set of investment management, brokerage, banking and related to COVID-19. Noninterest expense increased $329
retirement products. million to $14.2 billion primarily driven by higher investments in
Bank of America Private Bank, together with MLGWM's primary sales professionals and revenue-related incentives.
Private Wealth Management business, provides comprehensive The return on average allocated capital was 21 percent,
wealth management solutions targeted to high net worth and down from 29 percent, due to lower net income and, to a lesser
ultra high net worth clients, as well as customized solutions to extent, a small increase in allocated capital.
meet clients' wealth structuring, investment management, trust Average loans increased $14.5 billion to $183.4 billion
and banking needs, including specialty asset management primarily driven by residential mortgage and custom lending.
services. Average deposits increased $30.6 billion to $287.1 billion
Net income for GWIM decreased $1.2 billion to $3.1 billion primarily driven by inflows resulting from client responses to
primarily due to lower net interest income, higher noninterest market volatility and lower spending.
expense and higher provision for credit losses. MLGWM revenue of $15.3 billion decreased five percent
Net interest income decreased $1.0 billion to $5.5 billion primarily driven by the impact of lower interest rates, partially
due to the impact of lower interest rates, partially offset by the offset by the benefits of higher market valuations and positive
benefit of strong deposit and loan growth. AUM flows.
Bank of America Private Bank revenue of $3.3 billion
decreased four percent primarily driven by the impact of lower
interest rates.
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Key Indicators and Metrics

(Dollars in millions, except as noted) 2020 2019
Revenue by Business
Merrill Lynch Global Wealth Management $ 15,292 $ 16,112
Bank of America Private Bank 3,292 3,426
Total revenue, net of interest expense $ 18,584 $ 19,538
Client Balances by Business, at year end

Merrill Lynch Global Wealth Management $ 2,808,340 $ 2,558,102
Bank of America Private Bank 541,464 489,690
Total client balances $ 3,349,804 $ 3,047,792
Client Balances by Type, at year end

Assets under management $ 1,408,465 $ 1,275,555
Brokerage and other assets 1,479,614 1,372,733
Deposits 322,157 263,103
Loans and leases (1) 191,124 179,296
Less: Managed deposits in assets under management (51,556) (42,895)
Total client balances $ 3,349,804 $ 3,047,792
Assets Under Management Rollforward

Assets under management, beginning of year $ 1,275,555 $ 1,072,234
Net client flows 19,596 24,865
Market valuation/other 113,314 178,456
Total assets under management, end of year $ 1,408,465 $ 1,275,555
Associates, at year end

Number of financial advisors 17,331 17,458
Total wealth advisors, including financial advisors 19,373 19,440
Total primary sales professionals, including financial advisors and wealth advisors 21,213 20,586
Merrill Lynch Global Wealth Management Metric

Financial advisor productivity (2) (in thousands) $ 1,126 $ 1,082
Bank of America Private Bank Metric, at year end

Primary sales professionals 1,759 1,766
(1)
Includes margin receivables which are classified in customer and other receivables on the Consolidated Balance Sheet.
(2)
For a definition, see Key Metrics on page 196.
Client Balances represent the net change in clients’ AUM balances over a
Client balances managed under advisory and/or discretion of specified period of time, excluding market appreciation/
GWIM are AUM and are typically held in diversified portfolios. depreciation and other adjustments.
Fees earned on AUM are calculated as a percentage of clients’ Client balances increased $302.0 billion, or 10 percent, to
AUM balances. The asset management fees charged to clients $3.3 trillion at December 31, 2020 compared to December 31,
per year depend on various factors, but are commonly driven by 2019. The increase in client balances was primarily due to
the breadth of the client’s relationship. The net client AUM flows higher market valuations and positive client flows.
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Global Banking

Net interest income $ 9,013 $ 10,675 (16)%
Noninterest income:
Service charges 3,238 3,015 7
Investment banking fees 4,010 3,137 28
All other income 2,726 3,656 (25)
Total revenue, net of interest expense 18,987 20,483 (7)
Provision for credit losses 4,897 414 n/m

Income before income taxes 4,753 11,058 (57)
Income tax expense 1,283 2,985 (57)
Net income $ 3,470 $ 8,073 (57)
Net interest yield 1.86 2.75

Balance Sheet
Average
Total assets 542,302 443,083 22
Total deposits 456,562 362,731 26
Year end
Total loans and leases $ 339,649 $ 379,268 (10)%
Total assets 580,561 464,032 25
Total deposits 493,748 383,180 29
Global Banking, which includes Global Corporate Banking, Global billion to $9.0 billion primarily driven by lower interest rates,
Commercial Banking, Business Banking and Global Investment partially offset by higher loan and deposit balances.
Banking, provides a wide range of lending-related products and Noninterest income of $10.0 billion increased $166 million
services, integrated working capital management and treasury driven by higher investment banking fees, partially offset by
solutions, and underwriting and advisory services through our lower valuation driven adjustments on the fair value loan
network of offices and client relationship teams. Our lending portfolio, debt securities and leveraged loans, as well as the
products and services include commercial loans, leases, allocation of ALM results.
commitment facilities, trade finance, commercial real estate The provision for credit losses increased $4.5 billion to $4.9
lending and asset-based lending. Our treasury solutions billion primarily due to the weaker economic outlook related to
business includes treasury management, foreign exchange, COVID-19. Noninterest expense increased $326 million primarily
short-term investing options and merchant services. We also due to continued investments in the business, partially offset by
provide investment banking products to our clients such as debt lower revenue-related incentives.
and equity underwriting and distribution, and merger-related and The return on average allocated capital was eight percent in
other advisory services. Underwriting debt and equity issuances, 2020 compared to 20 percent in 2019 due to lower net income
fixed-income and equity research, and certain market-based and, to a lesser extent, an increase in allocated capital. For
activities are executed through our global broker-dealer information on capital allocated to the business segments, see
affiliates, which are our primary dealers in several countries. Business Segment Operations on page 59.
Within Global Banking, Global Corporate Banking clients
generally include large global corporations, financial institutions Global Corporate, Global Commercial and Business
and leasing clients. Global Commercial Banking clients Banking
generally include middle-market companies, commercial real Global Corporate, Global Commercial and Business Banking
estate firms and not-for-profit companies. Business Banking each include Business Lending and Global Transaction Services
clients include mid-sized U.S.-based businesses requiring activities. Business Lending includes various lending-related
customized and integrated financial advice and solutions. products and services, and related hedging activities, including
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Net income for Global Banking decreased $4.6 billion to commercial loans, leases, commitment facilities, trade finance,
$3.5 billion primarily driven by higher provision for credit losses real estate lending and asset-based lending. Global Transaction
as well as lower revenue. Services includes deposits, treasury management, credit card,
Revenue decreased $1.5 billion to $19.0 billion driven by foreign exchange and short-term investment products.
lower net interest income. Net interest income decreased $1.7

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The table below and following discussion present a summary of the results, which exclude certain investment banking, merchant
services and PPP activities in Global Banking.
Global Corporate, Global Commercial and Business Banking

Global Corporate Banking Global Commercial Banking Business Banking Total
(Dollars in millions) 2020 2019 2020 2019 2020 2019 2020 2019
Revenue
Business Lending $ 3,552 $ 3,994 $ 3,743 $ 4,132 $ 261 $ 363 $ 7,556 $ 8,489
Global Transaction Services 2,986 3,994 3,169 3,499 893 1,064 7,048 8,557
Total revenue, net of interest expense $ 6,538 $ 7,988 $ 6,912 $ 7,631 $ 1,154 $ 1,427 $ 14,604 $ 17,046
Balance Sheet
Average
Total loans and leases $ 179,393 $ 177,713 $ 182,212 $ 181,485 $ 14,410 $ 15,058 $ 376,015 $ 374,256
Total deposits 216,371 177,924 191,813 144,620 48,214 40,196 456,398 362,740
Year end
Total loans and leases $ 153,126 $ 181,409 $ 164,641 $ 182,727 $ 13,242 $ 15,152 $ 331,009 $ 379,288
Total deposits 233,484 185,352 207,597 157,322 52,150 40,504 493,231 383,178
Business Lending revenue decreased $933 million in 2020 consolidated investment banking fees, the following table
compared to 2019. The decrease was primarily driven by lower presents total Corporation investment banking fees and the
interest rates. portion attributable to Global Banking.
Global Transaction Services revenue decreased $1.5 billion
in 2020 compared to 2019 driven by the allocation of ALM
results, partially offset by the impact of higher deposit balances. Investment Banking Fees
Average loans and leases were relatively flat in 2020
Global Banking Total Corporation
compared to 2019. Average deposits increased 26 percent 2019 2019
primarily due to client responses to market volatility, Products
government stimulus and placement of credit draws. Advisory $ 1,458 $ 1,336 $ 1,621 $ 1,460
Debt issuance 1,555 1,348 3,443 3,107
Global Investment Banking Equity issuance 997 453 2,328 1,259
Client teams and product specialists underwrite and distribute Gross investment
debt, equity and loan products, and provide advisory services banking fees 4,010 3,137 7,392 5,826
and tailored risk management solutions. The economics of Self-led deals (93) (62) (212) (184)
Total investment
certain investment banking and underwriting activities are banking fees $ 3,917 $ 3,075 $ 7,180 $ 5,642
shared primarily between Global Banking and Global Markets
under an internal revenue-sharing arrangement. Global Banking Total Corporation investment banking fees, excluding self-led
originates certain deal-related transactions with our corporate deals, of $7.2 billion, which are primarily included within Global
and commercial clients that are executed and distributed by Banking and Global Markets, increased 27 percent primarily
Global Markets. To provide a complete discussion of our driven by higher equity issuance fees.
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Global Markets

Net interest income $ 4,646 $ 3,915 19 %
Noninterest income:
Investment and brokerage services 1,973 1,738 14
Investment banking fees 2,991 2,288 31
Market making and similar activities 8,471 7,065 20
All other income 685 608 13
Total revenue, net of interest expense 18,766 15,614 20
Provision for credit losses 251 (9) n/m

Income before income taxes 7,093 4,895 45
Income tax expense 1,844 1,395 32
Net income $ 5,249 $ 3,500 50

Balance Sheet
Average
Trading-related assets:
Trading account securities $ 243,519 $ 246,336 (1)%
Reverse repurchases 104,697 116,883 (10)
Securities borrowed 87,125 83,216 5
Derivative assets 47,655 43,273 10
Total trading-related assets 482,996 489,708 (1)
Total loans and leases 73,062 71,334 2
Total assets 685,047 679,300 1
Total deposits 47,400 31,380 51
Year end
Total trading-related assets $ 421,698 $ 452,499 (7)%
Total loans and leases 78,415 72,993 7
Total earning assets 447,350 471,701 (5)
Total assets 616,609 641,809 (4)
Total deposits 53,925 34,676 56
Global Markets offers sales and trading services and research executed and distributed by Global Markets. For information on
services to institutional clients across fixed-income, credit, investment banking fees on a consolidated basis, see page 66.
currency, commodity and equity businesses. Global Markets The following explanations for year-over-year changes for
product coverage includes securities and derivative products in Global Markets, including those disclosed under Sales and
both the primary and secondary markets. Global Markets Trading Revenue, are the same for amounts including and
provides market-making, financing, securities clearing, excluding net DVA. Amounts excluding net DVA are a non-GAAP
settlement and custody services globally to our institutional financial measure. For more information on net DVA, see
investor clients in support of their investing and trading Supplemental Financial Data on page 54.
activities. We also work with our commercial and corporate Net income for Global Markets increased $1.7 billion to $5.2
clients to provide risk management products using interest rate, billion. Net DVA losses were $133 million compared to losses
equity, credit, currency and commodity derivatives, foreign of $222 million in 2019. Excluding net DVA, net income
exchange, fixed-income and mortgage-related products. As a increased $1.7 billion to $5.4 billion. These increases were
result of our market-making activities in these products, we may primarily driven by higher revenue, partially offset by higher
be required to manage risk in a broad range of financial noninterest expense and provision for credit losses.
products including government securities, equity and equity- Revenue increased $3.2 billion to $18.8 billion primarily
linked securities, high-grade and high-yield corporate debt driven by higher sales and trading revenue and investment
securities, syndicated loans, MBS, commodities and asset- banking fees. Sales and trading revenue increased $2.3 billion,
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backed securities. The economics of certain investment banking and excluding net DVA, increased $2.2 billion. These increases
and underwriting activities are shared primarily between Global were driven by higher revenue across FICC and Equities.
Markets and Global Banking under an internal revenue-sharing The provision for credit losses increased $260 million
arrangement. Global Banking originates certain deal-related primarily due to the weaker economic outlook related to
transactions with our corporate and commercial clients that are COVID-19. Noninterest expense increased $694 million to

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$11.4 billion driven by higher activity-based expenses for both excluding net DVA, which is a non-GAAP financial measure. For
card and trading. more information on net DVA, see Supplemental Financial Data
Average total assets increased $5.7 billion to $685.0 billion on page 54.
driven by higher client balances in Global Equities. Year-end
total assets decreased $25.2 billion to $616.6 billion driven by
lower levels of inventory in FICC and increased hedging of client Sales and Trading Revenue (1, 2, 3)
activity in Equities with derivative transactions relative to stock
positions. (Dollars in millions) 2020 2019
Sales and trading revenue
The return on average allocated capital was 15 percent, up
Fixed income, currencies and commodities $ 9,595 $ 8,189
from 10 percent, reflecting higher net income, partially offset by Equities 5,422 4,493
an increase in allocated capital. Total sales and trading revenue $ 15,017 $ 12,682
Sales and Trading Revenue Sales and trading revenue, excluding net DVA (4)
Sales and trading revenue includes unrealized and realized Fixed income, currencies and commodities $ 9,725 $ 8,397
gains and losses on trading and other assets which are Equities 5,425 4,507
included in market making and similar activities, net interest Total sales and trading revenue, excluding net DVA $ 15,150 $ 12,904
income, and fees primarily from commissions on equity (1)
For more information on sales and trading revenue, see Note 3 – Derivatives to the
securities. Sales and trading revenue is segregated into fixed- (2)
Includes FTE adjustments of $196 million and $187 million for 2020 and 2019.
income (government debt obligations, investment and non- (3)
Includes Global Banking sales and trading revenue of $478 million and $538 million for
2020 and 2019.
investment grade corporate debt obligations, commercial MBS, (4)
FICC and Equities sales and trading revenue, excluding net DVA, is a non-GAAP financial
residential mortgage-backed securities, collateralized loan measure. FICC net DVA losses were $130 million and $208 million for 2020 and 2019.
Equities net DVA losses were $3 million and $14 million for 2020 and 2019.
obligations, interest rate and credit derivative contracts),
currencies (interest rate and foreign exchange contracts), FICC revenue increased $1.3 billion driven by increased
commodities (primarily futures, forwards, swaps and options) client activity and improved market-making conditions across
and equities (equity-linked derivatives and cash equity activity). macro products. Equities revenue increased $918 million driven
The following table and related discussion present sales and by increased client activity and a strong trading performance in a
trading revenue, substantially all of which is in Global Markets, more volatile market environment.
with the remainder in Global Banking. In addition, the following
table and related discussion present sales and trading revenue,
All Other

Net interest income $ 34 $ 234 (85)%
Noninterest income (loss) (3,606) (2,617) 38
Total revenue, net of interest expense (3,572) (2,383) 50
Provision for credit losses 50 (669) (107)

Noninterest expense 1,422 3,690 (61)
Loss before income taxes (5,044) (5,404) (7)
Income tax benefit (4,637) (4,048) 15
Net loss $ (407) $ (1,356) (70)
Balance Sheet
Average
Total assets (1) 228,783 210,689 9
Total deposits 18,247 21,359 (15)
Year end
Total assets (1) 264,141 224,375 18
Total deposits 12,998 23,089 (44)
(1)
In segments where the total of liabilities and equity exceeds assets, which are generally deposit-taking segments, we allocate assets from All Other to those segments to match liabilities (i.e.,
deposits) and allocated shareholders’ equity. Average allocated assets were $763.1 billion and $544.3 billion for 2020 and 2019, and year-end allocated assets were $977.7 billion and $565.4
billion at December 31, 2020 and 2019.
All Other consists of ALM activities, equity investments, non- 23 – Business Segment Information to the Consolidated
core mortgage loans and servicing activities, liquidating Financial Statements.
businesses and certain expenses not otherwise allocated to a Residential mortgage loans that are held for ALM purposes,
business segment. ALM activities encompass certain residential including interest rate or liquidity risk management, are
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mortgages, debt securities, and interest rate and foreign classified as core and are presented on the balance sheet of All
currency risk management activities. Substantially all of the Other. During 2020, residential mortgage loans held for ALM
results of ALM activities are allocated to our business activities decreased $12.7 billion to $9.0 billion due primarily to
segments. For more information on our ALM activities, see Note loan sales. Non-core residential mortgage and home equity
loans, which are principally runoff portfolios, are also held in All

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Other. During 2020, total non-core loans decreased $3.0 billion commit to future purchases of products or services from
to $12.6 billion due primarily to payoffs and paydowns, as well unaffiliated parties. Purchase obligations are defined as
as Federal Housing Administration (FHA) loan conveyances and obligations that are legally binding agreements whereby we
sales, partially offset by repurchases. For more information on agree to purchase products or services with a specific minimum
the composition of the core and non-core portfolios, see quantity at a fixed, minimum or variable price over a specified
Consumer Portfolio Credit Risk Management on page 85. period of time. Included in purchase obligations are vendor
The net loss for All Other decreased $949 million to a net contracts, the most significant of which include communication
loss of $407 million, primarily due to a $2.1 billion pretax services, processing services and software contracts. Debt,
impairment charge related to the notice of termination of the lease and other obligations are more fully discussed in Note 11
merchant services joint venture in 2019, partially offset by lower – Long-term Debt and Note 12 – Commitments and
revenue and higher provision for credit losses. Contingencies to the Consolidated Financial Statements.
Revenue decreased $1.2 billion primarily due to Other long-term liabilities include our contractual funding
extinguishment losses on certain structured liabilities, higher obligations related to the Non-U.S. Pension Plans and
client-driven ESG investment activity, resulting in higher Nonqualified and Other Pension Plans (together, the Plans).
partnership losses on these tax-advantaged investments, and Obligations to the Plans are based on the current and projected
lower net interest income, partially offset by a gain on sales of obligations of the Plans, performance of the Plans’ assets, and
mortgage loans. any participant contributions, if applicable. During 2020 and
The provision for credit losses increased $719 million to 2019, we contributed $115 million and $135 million to the
$50 million from a provision benefit of $669 million in 2019, Plans, and we expect to make $136 million of contributions
primarily due to recoveries from sales of previously charged-off during 2021. The Plans are more fully discussed in Note 17 –
non-core consumer real estate loans in 2019, as well as the Employee Benefit Plans to the Consolidated Financial
weaker economic outlook related to COVID-19. Statements.
Noninterest expense decreased $2.3 billion to $1.4 billion We enter into commitments to extend credit such as loan
primarily due to the $2.1 billion pretax impairment charge in commitments, standby letters of credit (SBLCs) and commercial
2019, partially offset by higher litigation expense. letters of credit to meet the financing needs of our customers.
The income tax benefit increased $589 million primarily For a summary of the total unfunded, or off-balance sheet, credit
driven by the impact of the U.K. tax law change and a higher extension commitment amounts by expiration date, see Credit
level of income tax credits related to our ESG investment Extension Commitments in Note 12 – Commitments and
activity, partially offset by the positive impact from the Contingencies to the Consolidated Financial Statements.
resolution of various tax controversy matters in 2019. Both We also utilize variable interest entities (VIEs) in the ordinary
years included income tax benefit adjustments to eliminate the course of business to support our financing and investing needs
FTE treatment of certain tax credits recorded in Global Banking. as well as those of our customers. For more information on our
involvement with unconsolidated VIEs, see Note 6 –
Off-Balance Sheet Arrangements and Securitizations and Other Variable Interest Entities to the
Contractual Obligations Consolidated Financial Statements.
Table 10 includes certain contractual obligations at December
We have contractual obligations to make future payments on
31, 2020 and 2019.
debt and lease agreements. Additionally, in the normal course
of business, we enter into contractual arrangements whereby we
Table 10 Contractual Obligations
December 31
December 31, 2020 2019
Due After Due After
One Year Three Years
Due in One Through Through Due After
(Dollars in millions) Year or Less Three Years Five Years Five Years Total Total
Long-term debt $ 20,352 $ 50,824 $ 48,568 $ 143,190 $ 262,934 $ 240,856
Operating lease obligations 1,927 3,169 2,395 4,609 12,100 11,794
Purchase obligations 551 700 80 103 1,434 3,530
Time deposits 50,661 3,206 426 1,563 55,856 74,673
Other long-term liabilities 1,656 1,092 953 781 4,482 4,099
Estimated interest expense on long-term debt and time deposits (1) 4,542 8,123 6,958 30,924 50,547 44,385
Total contractual obligations $ 79,689 $ 67,114 $ 59,380 $ 181,170 $ 387,353 $ 379,337
(1)
Represents forecasted net interest expense on long-term debt and time deposits based on interest rates at December 31, 2020 and 2019. Forecasts are based on the contractual maturity dates
of each liability, and are net of derivative hedges, where applicable.
Representations and Warranties Obligations

For information on representations and warranties obligations in connection with the sale of mortgage loans, see Note 12 –
Commitments and Contingencies to the Consolidated Financial Statements.
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Managing Risk Executive management assesses, with Board oversight, the

Risk is inherent in all our business activities. Sound risk risk-adjusted returns of each business. Management reviews
management enables us to serve our customers and deliver for and approves the strategic and financial operating plans, as well
our shareholders. If not managed well, risks can result in as the capital plan and Risk Appetite Statement, and
financial loss, regulatory sanctions and penalties, and damage recommends them annually to the Board for approval. Our
to our reputation, each of which may adversely impact our ability strategic plan takes into consideration return objectives and
to execute our business strategies. We take a comprehensive financial resources, which must align with risk capacity and risk
approach to risk management with a defined Risk Framework appetite. Management sets financial objectives for each
and an articulated Risk Appetite Statement, which are approved business by allocating capital and setting a target for return on
annually by the ERC and the Board. capital for each business. Capital allocations and operating
The seven key types of risk faced by the Corporation are limits are regularly evaluated as part of our overall governance
strategic, credit, market, liquidity, compliance, operational and processes as the businesses and the economic environment in
reputational. which we operate continue to evolve. For more information
regarding capital allocations, see Business Segment Operations
• Strategic risk is the risk to current or projected financial on page 59.
condition arising from incorrect assumptions about external The Corporation’s risk appetite indicates the amount of
or internal factors, inappropriate business plans, ineffective capital, earnings or liquidity we are willing to put at risk to
business strategy execution, or failure to respond in a timely achieve our strategic objectives and business plans, consistent
manner to changes in the regulatory, macroeconomic or with applicable regulatory requirements. Our risk appetite
competitive environments in the geographic locations in provides a common and comparable set of measures for senior
which we operate. management and the Board to clearly indicate our aggregate
• Credit risk is the risk of loss arising from the inability or level of risk and to monitor whether the Corporation’s risk profile
failure of a borrower or counterparty to meet its obligations. remains in alignment with our strategic and capital plans. Our
• Market risk is the risk that changes in market conditions risk appetite is formally articulated in the Risk Appetite
may adversely impact the value of assets or liabilities, or Statement, which includes both qualitative components and
otherwise negatively impact earnings. Market risk is quantitative limits.
composed of price risk and interest rate risk. Our overall capacity to take risk is limited; therefore, we
• Liquidity risk is the inability to meet expected or unexpected prioritize the risks we take in order to maintain a strong and
cash flow and collateral needs while continuing to support flexible financial position so we can withstand challenging
our businesses and customers under a range of economic economic conditions and take advantage of organic growth
conditions. opportunities. Therefore, we set objectives and targets for
• Compliance risk is the risk of legal or regulatory sanctions, capital and liquidity that are intended to permit us to continue to
material financial loss or damage to the reputation of the operate in a safe and sound manner, including during periods of
Corporation arising from the failure of the Corporation to stress.
comply with the requirements of applicable laws, rules and Our lines of business operate with risk limits (which may
regulations and our internal policies and procedures. include credit, market and/or operational limits, as applicable)
• Operational risk is the risk of loss resulting from inadequate that align with the Corporation’s risk appetite. Executive
or failed processes, people and systems, or from external management is responsible for tracking and reporting
events. performance measurements as well as any exceptions to
• Reputational risk is the risk that negative perceptions of the guidelines or limits. The Board, and its committees when
Corporation’s conduct or business practices may adversely appropriate, oversee financial performance, execution of the
impact its profitability or operations. strategic and financial operating plans, adherence to risk
appetite limits and the adequacy of internal controls.
The following sections address in more detail the specific For a more detailed discussion of our risk management
procedures, measures and analyses of the major categories of activities, see the discussion below and pages 73 through 108.
risk. This discussion of managing risk focuses on the current For more information about the Corporation's risks related to
Risk Framework that, as part of its annual review process, was the pandemic, see Item 1A. Risk Factors of our 2020 Annual
approved by the ERC and the Board. Report on Form 10-K. These COVID-19 related risks are being
As set forth in our Risk Framework, a culture of managing managed within our Risk Framework and supporting risk
risk well is fundamental to fulfilling our purpose and our values management programs.
and delivering responsible growth. It requires us to focus on risk
in all activities and encourages the necessary mindset and Risk Management Governance
behavior to enable effective risk management, and promotes The Risk Framework describes delegations of authority whereby
sound risk-taking within our risk appetite. Sustaining a culture of the Board and its committees may delegate authority to
managing risk well throughout the organization is critical to our management-level committees or executive officers. Such
success and is a clear expectation of our executive delegations may authorize certain decision-making and approval
management team and the Board. functions, which may be evidenced in, for example, committee
Our Risk Framework serves as the foundation for the charters, job descriptions, meeting minutes and resolutions.
consistent and effective management of risks facing the The chart below illustrates the inter-relationship among the
Corporation. The Risk Framework sets forth clear roles, Board, Board committees and management committees that
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responsibilities and accountability for the management of risk have the majority of risk oversight responsibilities for the
and provides a blueprint for how the Board, through delegation Corporation.
of authority to committees and executive officers, establishes
risk appetite and associated limits for our activities.

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The chart below illustrates the inter-relationship among the Board, Board committees and management committees that have
the majority of risk oversight responsibilities for the Corporation.
Board of Directors and Board Committees ERC may consult with other Board committees on risk-related
The Board is composed of 17 directors, all but one of whom are matters.
independent. The Board authorizes management to maintain an
Other Board Committees
effective Risk Framework, and oversees compliance with safe
Our Corporate Governance, ESG, and Sustainability Committee
and sound banking practices. In addition, the Board or its
oversees our Board’s governance processes, identifies and
committees conduct inquiries of, and receive reports from
reviews the qualifications of potential Board members,
management on risk-related matters to assess scope or
recommends nominees for election to our Board, recommends
resource limitations that could impede the ability of Independent
committee appointments for Board approval and reviews our
Risk Management (IRM) and/or Corporate Audit to execute its
Environmental, Social and Governance and stockholder
responsibilities. The Board committees discussed below have
engagement activities.
the principal responsibility for enterprise-wide oversight of our
Our Compensation and Human Capital Committee oversees
risk management activities. Through these activities, the Board
establishing, maintaining and administering our compensation
and applicable committees are provided with information on our
programs and employee benefit plans, including approving and
risk profile and oversee executive management addressing key
recommending our Chief Executive Officer’s (CEO) compensation
risks we face. Other Board committees, as described below,
to our Board for further approval by all independent directors;
provide additional oversight of specific risks.
reviewing and approving all of our executive officers’
Each of the committees shown on the above chart regularly
compensation, as well as compensation for non-management
reports to the Board on risk-related matters within the
directors; and reviewing certain other human capital
committee’s responsibilities, which is intended to collectively
management topics.
provide the Board with integrated insight about our management
of enterprise-wide risks. Management Committees
Audit Committee Management committees may receive their authority from the
Board, a Board committee, another management committee or
The Audit Committee oversees the qualifications, performance
from one or more executive officers. Our primary management
and independence of the Independent Registered Public
level risk committee is the Management Risk Committee (MRC).
Accounting Firm, the performance of our corporate audit
Subject to Board oversight, the MRC is responsible for
function, the integrity of our consolidated financial statements,
management oversight of key risks facing the Corporation. This
our compliance with legal and regulatory requirements, and
includes providing management oversight of our compliance and
makes inquiries of management or the Chief Audit Executive
operational risk programs, balance sheet and capital
(CAE) to determine whether there are scope or resource
management, funding activities and other liquidity activities,
limitations that impede the ability of Corporate Audit to execute
stress testing, trading activities, recovery and resolution
its responsibilities. The Audit Committee is also responsible for
planning, model risk, subsidiary governance and activities
overseeing compliance risk pursuant to the New York Stock
between member banks and their nonbank affiliates pursuant to
Exchange listing standards.
Federal Reserve rules and regulations, among other things.
Enterprise Risk Committee
Lines of Defense
The ERC has primary responsibility for oversight of the Risk
We have clear ownership and accountability across three lines
Framework and key risks we face and of the Corporation’s
of defense: Front Line Units (FLUs), IRM and Corporate Audit.
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overall risk appetite. It approves the Risk Framework and the

We also have control functions outside of FLUs and IRM (e.g.,
Risk Appetite Statement and further recommends these
Legal and Global Human Resources). The three lines of defense
documents to the Board for approval. The ERC oversees senior
are integrated into our management-level governance structure.
management’s responsibilities for the identification,
Each of these functional roles is further described in this
measurement, monitoring and control of key risks we face. The
section.
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Executive Officers appropriately considered, evaluated and responded to in a

Executive officers lead various functions representing the timely manner. We employ our risk management process,
functional roles. Authority for functional roles may be delegated referred to as Identify, Measure, Monitor and Control, as part of
to executive officers from the Board, Board committees or our daily activities.
management-level committees. Executive officers, in turn, may
Identify – To be effectively managed, risks must be clearly
further delegate responsibilities, as appropriate, to
defined and proactively identified. Proper risk identification
management level committees, management routines or
focuses on recognizing and understanding key risks inherent
individuals. Executive officers review our activities for
in our business activities or key risks that may arise from
consistency with our Risk Framework, Risk Appetite Statement
external factors. Each employee is expected to identify and
and applicable strategic, capital and financial operating plans,
escalate risks promptly. Risk identification is an ongoing
as well as applicable policies, standards, procedures and
process, incorporating input from FLUs and control functions,
processes. Executive officers and other employees make
designed to be forward looking and capture relevant risk
decisions individually on a day-to-day basis, consistent with the
factors across all of our lines of business.
authority they have been delegated. Executive officers and other
Measure – Once a risk is identified, it must be prioritized and
employees may also serve on committees and participate in
accurately measured through a systematic risk quantification
committee decisions.
process including quantitative and qualitative components.
Front Line Units Risk is measured at various levels including, but not limited
FLUs, which include the lines of business as well as the Global to, risk type, FLU, legal entity and on an aggregate basis. This
Technology and Operations Group, are responsible for risk quantification process helps to capture changes in our
appropriately assessing and effectively managing all of the risks risk profile due to changes in strategic direction,
associated with their activities. concentrations, portfolio quality and the overall economic
Three organizational units that include FLU activities and environment. Senior management considers how risk
control function activities, but are not part of IRM are first, the exposures might evolve under a variety of stress scenarios.
Chief Financial Officer (CFO) Group; second, Environmental, Monitor – We monitor risk levels regularly to track adherence to
Social and Governance (ESG), Capital Deployment (CD) and risk appetite, policies, standards, procedures and processes.
Public Policy (PP); and third, the Chief Administrative Officer We also regularly update risk assessments and review risk
(CAO) Group. exposures. Through our monitoring, we can determine our
level of risk relative to limits and can take action in a timely
Independent Risk Management manner. We also can determine when risk limits are breached
IRM is part of our control functions and includes Global Risk and have processes to appropriately report and escalate
Management. We have other control functions that are not part exceptions. This includes requests for approval to managers
of IRM (other control functions may also provide oversight to and alerts to executive management, management-level
FLU activities), including Legal, Global Human Resources and committees or the Board (directly or through an appropriate
certain activities within the CFO Group; ESG, CD and PP; and committee).
CAO Group. IRM, led by the Chief Risk Officer (CRO), is Control – We establish and communicate risk limits and controls
responsible for independently assessing and overseeing risks through policies, standards, procedures and processes that
within FLUs and other control functions. IRM establishes written define the responsibilities and authority for risk-taking. The
enterprise policies and procedures that include concentration limits and controls can be adjusted by the Board or
risk limits, where appropriate. Such policies and procedures management when conditions or risk tolerances warrant.
outline how aggregate risks are identified, measured, monitored These limits may be absolute (e.g., loan amount, trading
and controlled. volume) or relative (e.g., percentage of loan book in higher-
The CRO has the stature, authority and independence to risk categories). Our lines of business are held accountable to
develop and implement a meaningful risk management perform within the established limits.
framework. The CRO has unrestricted access to the Board and The formal processes used to manage risk represent a part of
reports directly to both the ERC and to the CEO. Global Risk our overall risk management process. We instill a strong and
Management is organized into horizontal risk teams that cover a comprehensive culture of managing risk well through
specific risk area and vertical CRO teams that cover a particular communications, training, policies, procedures and
front line unit or control function. These teams work organizational roles and responsibilities. Establishing a culture
collaboratively in executing their respective duties. reflective of our purpose to help make our customers’ financial
Corporate Audit lives better and delivering our responsible growth strategy is
Corporate Audit and the CAE maintain their independence from also critical to effective risk management. We understand that
the FLUs, IRM and other control functions by reporting directly to improper actions, behaviors or practices that are illegal,
the Audit Committee or the Board. The CAE administratively unethical or contrary to our core values could result in harm to
reports to the CEO. Corporate Audit provides independent the Corporation, our shareholders or our customers, damage
assessment and validation through testing of key processes the integrity of the financial markets, or negatively impact our
and controls across the Corporation. Corporate Audit includes reputation, and have established protocols and structures so
Credit Review which periodically tests and examines credit that such conduct risk is governed and reported across the
portfolios and processes. Corporation. Specifically, our Code of Conduct provides a
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framework for all of our employees to conduct themselves with

Risk Management Processes the highest integrity. Additionally, we continue to strengthen the
The Risk Framework requires that strong risk management link between the employee performance management process
practices are integrated in key strategic, capital and financial and individual compensation to encourage employees to work
planning processes and in day-to-day business processes toward enterprise-wide risk goals.
across the Corporation, with a goal of ensuring risks are
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Corporation-wide Stress Testing approval where required. With oversight by the Board and the
Integral to our Capital Planning, Financial Planning and Strategic ERC, executive management performs similar analyses
Planning processes, we conduct capital scenario management throughout the year and evaluates changes to the financial
and stress forecasting on a periodic basis to better understand forecast or the risk, capital or liquidity positions as deemed
balance sheet, earnings and capital sensitivities to certain appropriate to balance and optimize achieving the targeted risk
economic and business scenarios, including economic and appetite, shareholder returns and maintaining the targeted
market conditions that are more severe than anticipated. These financial strength. Proprietary models are used to measure the
stress forecasts provide an understanding of the potential capital requirements for credit, country, market, operational and
impacts from our risk profile on the balance sheet, earnings and strategic risks. The allocated capital assigned to each business
capital, and serve as a key component of our capital and risk is based on its unique risk profile. With oversight by the Board,
management practices. The intent of stress testing is to executive management assesses the risk-adjusted returns of
develop a comprehensive understanding of potential impacts of each business in approving strategic and financial operating
on- and off-balance sheet risks at the Corporation and how they plans. The businesses use allocated capital to define business
impact financial resiliency, which provides confidence to strategies and price products and transactions.
management, regulators and our investors.
Capital Management
Contingency Planning The Corporation manages its capital position so that its capital
We have developed and maintain contingency plans that are is more than adequate to support its business activities and
designed to prepare us in advance to respond in the event of aligns with risk, risk appetite and strategic planning.
potential adverse economic, financial or market stress. These Additionally, we seek to maintain safety and soundness at all
contingency plans include our Capital Contingency Plan and times, even under adverse scenarios, take advantage of organic
Financial Contingency and Recovery Plan, which provide growth opportunities, meet obligations to creditors and
monitoring, escalation, actions and routines designed to enable counterparties, maintain ready access to financial markets,
us to increase capital, access funding sources and reduce risk continue to serve as a credit intermediary, remain a source of
through consideration of potential options that include asset strength for our subsidiaries, and satisfy current and future
sales, business sales, capital or debt issuances, or other de- regulatory capital requirements. Capital management is
risking strategies. We also maintain a Resolution Plan to limit integrated into our risk and governance processes, as capital is
adverse systemic impacts that could be associated with a a key consideration in the development of our strategic plan,
potential resolution of Bank of America. risk appetite and risk limits.
We conduct an Internal Capital Adequacy Assessment
Strategic Risk Management Process (ICAAP) on a periodic basis. The ICAAP is a forward-
Strategic risk is embedded in every business and is one of the looking assessment of our projected capital needs and
major risk categories along with credit, market, liquidity, resources, incorporating earnings, balance sheet and risk
compliance, operational and reputational risks. This risk results forecasts under baseline and adverse economic and market
from incorrect assumptions about external or internal factors, conditions. We utilize periodic stress tests to assess the
inappropriate business plans, ineffective business strategy potential impacts to our balance sheet, earnings, regulatory
execution, or failure to respond in a timely manner to changes in capital and liquidity under a variety of stress scenarios. We
the regulatory, macroeconomic or competitive environments in perform qualitative risk assessments to identify and assess
the geographic locations in which we operate, such as material risks not fully captured in our forecasts or stress tests.
competitor actions, changing customer preferences, product We assess the potential capital impacts of proposed changes to
obsolescence and technology developments. Our strategic plan regulatory capital requirements. Management assesses ICAAP
is consistent with our risk appetite, capital plan and liquidity results and provides documented quarterly assessments of the
requirements and specifically addresses strategic risks. adequacy of our capital guidelines and capital position to the
On an annual basis, the Board reviews and approves the Board or its committees.
strategic plan, capital plan, financial operating plan and Risk We periodically review capital allocated to our businesses
Appetite Statement. With oversight by the Board, executive and allocate capital annually during the strategic and capital
management directs the lines of business to execute our planning processes. For more information, see Business
strategic plan consistent with our core operating principles and Segment Operations on page 59.
risk appetite. The executive management team monitors
business performance throughout the year and provides the CCAR and Capital Planning
Board with regular progress reports on whether strategic The Federal Reserve requires BHCs to submit a capital plan and
objectives and timelines are being met, including reports on planned capital actions on an annual basis, consistent with the
strategic risks and if additional or alternative actions need to be rules governing the CCAR capital plan.
considered or implemented. The regular executive reviews focus Based on the results of our 2020 CCAR supervisory stress
on assessing forecasted earnings and returns on capital, the test that was submitted to the Federal Reserve in the second
current risk profile, current capital and liquidity requirements, quarter of 2020, we are subject to a 2.5 percent stress capital
staffing levels and changes required to support the strategic buffer (SCB) for the period beginning October 1, 2020 and
plan, stress testing results, and other qualitative factors such ending on September 30, 2021. Our Common equity tier 1
(CET1) capital ratio under the Standardized approach must
as market growth rates and peer analysis.
remain above 9.5 percent during this period (the sum of our
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Significant strategic actions, such as capital actions,

CET1 capital ratio minimum of 4.5 percent, global systemically
material acquisitions or divestitures, and resolution plans are
important bank (G-SIB) surcharge of 2.5 percent and our SCB of
reviewed and approved by the Board. At the business level, 2.5 percent) in order to avoid restrictions on capital distributions
processes are in place to discuss the strategic risk implications and discretionary bonus payments.
of new, expanded or modified businesses, products or services
and other strategic initiatives, and to provide formal review and
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Due to economic uncertainty resulting from the pandemic, calculating risk-weighted assets (RWA), the Standardized
the Federal Reserve required all large banks to update and approach and the Advanced approaches. The Standardized
resubmit their capital plans in November 2020 based on the approach relies primarily on supervisory risk weights based on
Federal Reserve’s updated supervisory stress test scenarios. exposure type, and the Advanced approaches determine risk
The results of the additional supervisory stress tests were weights based on internal models.
published in December 2020. The Corporation's depository institution subsidiaries are also
The Federal Reserve also required large banks to suspend subject to the Prompt Corrective Action (PCA) framework. The
share repurchase programs during the second half of 2020, Corporation and its primary affiliated banking entity, BANA, are
except for repurchases to offset shares awarded under equity- Advanced approaches institutions under Basel 3 and are
based compensation plans, and to limit common stock required to report regulatory risk-based capital ratios and RWA
dividends to existing rates that did not exceed the average of under both the Standardized and Advanced approaches. The
the last four quarters’ net income. The Federal Reserve’s
approach that yields the lower ratio is used to assess capital
directives regarding share repurchases aligned with our decision
adequacy including under the PCA framework. As of
to voluntarily suspend our general common stock repurchase
December 31, 2020, the CET1, Tier 1 capital and Total capital
program during the first half of 2020. The suspension of our
repurchases did not include repurchases to offset shares ratios for the Corporation were lower under the Standardized
awarded under our equity-based compensation plans. Pursuant approach.
to the Board’s authorization, we repurchased $7.0 billion of Minimum Capital Requirements
common stock during 2020.
In order to avoid restrictions on capital distributions and
In December 2020, the Federal Reserve announced that
discretionary bonus payments, the Corporation must meet risk-
beginning in the first quarter of 2021, large banks would be
based capital ratio requirements that include a capital
permitted to pay common stock dividends at existing rates and
conservation buffer greater than 2.5 percent, plus any
to repurchase shares in an amount that, when combined with
applicable countercyclical capital buffer and a G-SIB surcharge.
dividends paid, does not exceed the average of net income over
On October 1, 2020, the capital conservation buffer was
the last four quarters.
replaced by the SCB for the Corporation’s Standardized
On January 19, 2021, we announced that the Board
declared a quarterly common stock dividend of $0.18 per share, approach ratio requirements. The buffers and surcharge must
payable on March 26, 2021 to shareholders of record as of be comprised solely of CET1 capital.
March 5, 2021. We also announced that the Board authorized The Corporation is also required to maintain a minimum
the repurchase of $2.9 billion in common stock through March supplementary leverage ratio (SLR) of 3.0 percent plus a
31, 2021, plus repurchases to offset shares awarded under leverage buffer of 2.0 percent in order to avoid certain
equity-based compensation plans during the same period, restrictions on capital distributions and discretionary bonus
estimated to be approximately $300 million. This authorization payments. Our insured depository institution subsidiaries are
equals the maximum amount allowed by the Federal Reserve for required to maintain a minimum 6.0 percent SLR to be
the period. considered well capitalized under the PCA framework. The
Our stock repurchase program is subject to various factors, numerator of the SLR is quarter-end Basel 3 Tier 1 capital. The
including the Corporation’s capital position, liquidity, financial denominator is total leverage exposure based on the daily
performance and alternative uses of capital, stock trading price average of the sum of on-balance sheet exposures less
and general market conditions, and may be suspended at any permitted deductions and applicable temporary exclusions, as
time. Such repurchases may be effected through open market well as the simple average of certain off-balance sheet
purchases or privately negotiated transactions, including exposures, as of the end of each month in a quarter. For more
repurchase plans that satisfy the conditions of Rule 10b5-1 of information, see Capital Management – Regulatory
the Securities Exchange Act of 1934, as amended (Exchange Developments on page 78.
Act).
Capital Composition and Ratios
Regulatory Capital Table 11 presents Bank of America Corporation’s capital ratios
As a financial services holding company, we are subject to and related information in accordance with Basel 3
regulatory capital rules, including Basel 3, issued by U.S. Standardized and Advanced approaches as measured at
banking regulators. Basel 3 established minimum capital ratios December 31, 2020 and 2019. For the periods presented
and buffer requirements and outlined two methods of herein, the Corporation met the definition of well capitalized
under current regulatory requirements.
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Table 11 Bank of America Corporation Regulatory Capital under Basel 3

Standardized Advanced Regulatory
Approach (1, 2) Approaches (1) Minimum (3)
(Dollars in millions, except as noted) December 31, 2020
Risk-based capital metrics:
Common equity tier 1 capital $ 176,660 $ 176,660
Tier 1 capital 200,096 200,096
Total capital (4) 237,936 227,685
Risk-weighted assets (in billions) 1,480 1,371
Common equity tier 1 capital ratio 11.9 % 12.9 % 9.5 %
Tier 1 capital ratio 13.5 14.6 11.0
Total capital ratio 16.1 16.6 13.0
Leverage-based metrics:
Adjusted quarterly average assets (in billions) (5) $ 2,719 $ 2,719
Tier 1 leverage ratio 7.4 % 7.4 % 4.0
Supplementary leverage exposure (in billions) (6) $ 2,786

Supplementary leverage ratio 7.2 % 5.0
December 31, 2019

Tier 1 capital 188,492 188,492
Total capital (4) 221,230 213,098
Supplementary leverage exposure (in billions) $ 2,946

(1)
As of December 31, 2020, capital ratios are calculated using the regulatory capital rule that allows a five-year transition period related to the adoption of CECL.
(2)
Derivative exposure amounts are calculated using the standardized approach for measuring counterparty credit risk at December 31, 2020 and the current exposure method at December 31,
2019.
(3)
The capital conservation buffer and G-SIB surcharge were 2.5 percent at both December 31, 2020 and 2019. At December 31, 2020, the Corporation's SCB of 2.5 percent was applied in place of
the capital conservation buffer under the Standardized approach. The countercyclical capital buffer for both periods was zero. The SLR minimum includes a leverage buffer of 2.0 percent.
(4)
Total capital under the Advanced approaches differs from the Standardized approach due to differences in the amount permitted in Tier 2 capital related to the qualifying allowance for credit
losses.
(5)
Reflects total average assets adjusted for certain Tier 1 capital deductions.
(6)
Supplementary leverage exposure at December 31, 2020 reflects the temporary exclusion of U.S. Treasury securities and deposits at Federal Reserve Banks.
At December 31, 2020, CET1 capital was $176.7 billion, an losses included in Tier 2 capital and the issuance of preferred
increase of $9.9 billion from December 31, 2019, driven by stock. RWA under the Standardized approach, which yielded the
earnings and net unrealized gains on available-for-sale (AFS) lower CET1 capital ratio at December 31, 2020, decreased
debt securities included in accumulated other comprehensive $13.7 billion during 2020 to $1,480 billion primarily due to
income (OCI), partially offset by common stock repurchases and lower commercial and consumer lending exposures, partially
dividends. Total capital under the Standardized approach offset by investments of excess deposits in securities. Table 12
increased $16.7 billion primarily driven by the same factors as shows the capital composition at December 31, 2020 and
CET1 capital, an increase in the adjusted allowance for credit 2019.
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Table 12 Capital Composition under Basel 3

December 31
Total common shareholders’ equity $ 248,414 $ 241,409
CECL transitional amount (1) 4,213 —
Goodwill, net of related deferred tax liabilities (68,565) (68,570)
Deferred tax assets arising from net operating loss and tax credit carryforwards (5,773) (5,193)
Intangibles, other than mortgage servicing rights, net of related deferred tax liabilities (1,617) (1,328)
Defined benefit pension plan net assets (1,164) (1,003)
Cumulative unrealized net (gain) loss related to changes in fair value of financial liabilities attributable to own creditworthiness,
net-of-tax 1,753 1,278
Other (601) 167
Common equity tier 1 capital 176,660 166,760
Qualifying preferred stock, net of issuance cost 23,437 22,329
Other (1) (597)
Tier 1 capital 200,096 188,492
Tier 2 capital instruments 22,213 22,538
Qualifying allowance for credit losses (2) 15,649 10,229
Other (22) (29)
Total capital under the Standardized approach 237,936 221,230
Adjustment in qualifying allowance for credit losses under the Advanced approaches (2) (10,251) (8,132)
Total capital under the Advanced approaches $ 227,685 $ 213,098
(1)
The CECL transitional amount includes the impact of the Corporation's adoption of the new CECL accounting standard on January 1, 2020 plus 25 percent of the increase in the adjusted
allowance for credit losses from January 1, 2020 through December 31, 2020.
(2)
The balance at December 31, 2020 includes the impact of transition provisions related to the new CECL accounting standard.
Table 13 shows the components of RWA as measured under Basel 3 at December 31, 2020 and 2019.
Table 13 Risk-weighted Assets under Basel 3

Standardized Advanced Standardized Advanced
Approach (1) Approaches Approach (1) Approaches
December 31
(Dollars in billions) 2020 2019
Credit risk $ 1,420 $ 896 $ 1,437 $ 858
Market risk 60 60 56 55
Operational risk (2) n/a 372 n/a 500
Risks related to credit valuation adjustments n/a 43 n/a 34
Total risk-weighted assets $ 1,480 $ 1,371 $ 1,493 $ 1,447
(1)
2019.
(2)
December 31, 2020 includes the effects of an update made to our operational risk RWA model during the third quarter of 2020.
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Bank of America, N.A. Regulatory Capital

Table 14 presents regulatory capital information for BANA in accordance with Basel 3 Standardized and Advanced approaches as
measured at December 31, 2020 and 2019. BANA met the definition of well capitalized under the PCA framework for both periods.
Table 14 Bank of America, N.A. Regulatory Capital under Basel 3

Standardized Advanced Regulatory
Approach (1, 2) Approaches (1) Minimum (3)
Tier 1 capital 164,593 164,593
Total capital (4) 181,370 170,922

December 31, 2019

Tier 1 capital 154,626 154,626
Total capital (4) 166,567 158,665
Risk-weighted assets (in billions) 1,241 991

(1)
(2)
2019.
(3)
Risk-based capital regulatory minimums at both December 31, 2020 and 2019 are the minimum ratios under Basel 3 including a capital conservation buffer of 2.5 percent. The regulatory
minimums for the leverage ratios as of both period ends are the percent required to be considered well capitalized under the PCA framework.
(4)
losses.
(5)
Total Loss-Absorbing Capacity Requirements risk-based capital ratios and SLR, the Corporation is required
Total loss-absorbing capacity (TLAC) consists of the to maintain TLAC ratios in excess of minimum requirements
Corporation’s Tier 1 capital and eligible long-term debt issued plus applicable buffers to avoid restrictions on capital
directly by the Corporation. Eligible long-term debt for TLAC distributions and discretionary bonus payments. Table 15
ratios is comprised of unsecured debt that has a remaining presents the Corporation's TLAC and long-term debt ratios and
maturity of at least one year and satisfies additional related information as of December 31, 2020 and 2019.
requirements as prescribed in the TLAC final rule. As with the
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Table 15 Bank of America Corporation Total Loss-Absorbing Capacity and Long-Term Debt
Regulatory Long-term Regulatory
TLAC (1) Minimum (2) Debt Minimum (3)
(Dollars in millions) December 31, 2020
Total eligible balance $ 405,153 $ 196,997
Percentage of risk-weighted assets (4) 27.4 % 22.0 % 13.3 % 8.5 %
Percentage of supplementary leverage exposure (5, 6) 14.5 9.5 7.1 4.5
December 31, 2019

Total eligible balance $ 367,449 $ 171,349
Percentage of risk-weighted assets (4) 24.6 % 22.0 % 11.5 % 8.5 %
Percentage of supplementary leverage exposure (6) 12.5 9.5 5.8 4.5
(1)
As of December 31, 2020, TLAC ratios are calculated using the regulatory capital rule that allows a five-year transition period related to the adoption of CECL.
(2)
The TLAC RWA regulatory minimum consists of 18.0 percent plus a TLAC RWA buffer comprised of 2.5 percent plus the Method 1 G-SIB surcharge of 1.5 percent. The countercyclical buffer is zero
for both periods. The TLAC supplementary leverage exposure regulatory minimum consists of 7.5 percent plus a 2.0 percent TLAC leverage buffer. The TLAC RWA and leverage buffers must be
comprised solely of CET1 capital and Tier 1 capital, respectively.
(3)
The long-term debt RWA regulatory minimum is comprised of 6.0 percent plus an additional 2.5 percent requirement based on the Corporation’s Method 2 G-SIB surcharge. The long-term debt
leverage exposure regulatory minimum is 4.5 percent.
(4)
The approach that yields the higher RWA is used to calculate TLAC and long-term debt ratios, which was the Standardized approach as of both December 31, 2020 and 2019.
(5)
Supplementary leverage exposure at December 31, 2020 reflects the temporary exclusion of U.S. Treasury Securities and deposits at Federal Reserve Banks.
(6)
2019.
Regulatory Developments plan. The Corporation is instead subject to automatic

distribution limitations if its capital ratios fall below its buffer
Revisions to Basel 3 to Address Current Expected Credit requirements, which include the SCB.
Loss Accounting
On January 1, 2020, the Corporation adopted the new Eligible Retained Income
accounting standard that requires the measurement of the On March 17, 2020, in response to the economic impact of the
allowance for credit losses to be based on management’s best pandemic, the U.S. banking regulators issued an interim final
estimate of lifetime ECL inherent in the Corporation's relevant rule that revises the definition of eligible retained income to be
financial assets. For more information, see Note 1 – Summary of based on average net income over the prior four quarters. This
Significant Accounting Principles to the Consolidated Financial change, which was finalized on August 26, 2020, more
Statements. During the first quarter of 2020, in accordance with gradually phases in automatic distribution restrictions to the
an interim final rule issued by U.S. banking regulators that was extent capital buffers are breached.
finalized on August 26, 2020, the Corporation delayed for two Supplementary Leverage Ratio
years the initial adoption impact of CECL on regulatory capital, On April 1, 2020, in response to the economic impact of the
followed by a three-year transition period to phase out the pandemic, the Federal Reserve issued an interim final rule to
aggregate amount of the capital benefit provided during 2020 temporarily exclude the on-balance sheet amounts of U.S.
and 2021 (i.e., a five-year transition period). During the two-year Treasury securities and deposits at Federal Reserve Banks from
delay, the Corporation will add back to CET1 capital 100 percent the calculation of supplementary leverage exposure for bank
of the initial adoption impact of CECL plus 25 percent of the holding companies. The rule is effective for June 30, 2020
cumulative quarterly changes in the allowance for credit losses through March 31, 2021 reports. As of December 31, 2020,
(i.e., quarterly transitional amounts). After two years, starting on temporary exclusions improved the SLR by 1.0 percent to 7.2
January 1, 2022, the quarterly transitional amounts along with percent.
the initial adoption impact of CECL will be phased out of CET1 On May 15, 2020, the U.S. banking regulators issued an
capital over the three-year period. interim final rule that provides a similar temporary exclusion to
Stress Capital Buffer depository institutions, effective from the beginning of the
On March 4, 2020, the Federal Reserve issued a final rule that second quarter of 2020 through March 31, 2021; however,
integrates the annual quantitative assessment of the CCAR institutions must elect the relief. Beginning in the third quarter
program with the buffer requirements in the U.S. Basel 3 Final of 2020, a depository institution electing to apply the exclusion
Rule. The new approach replaced the static 2.5 percent capital must receive approval from its primary regulator prior to making
conservation buffer for Basel 3 Standardized approach any capital distributions as long as the exclusion is in effect. As
requirements with a SCB, calculated as the decline in the CET1 of December 31, 2020, the Corporation’s insured depository
capital ratio under the supervisory severely adverse scenario institution subsidiaries have not elected the exclusion.
plus four quarters of planned common stock dividends, floored Paycheck Protection Program Loans
at 2.5 percent. Based on the CCAR 2020 supervisory stress
On April 9, 2020, in response to the economic impact of the
test results, the Corporation is subject to a 2.5 percent SCB for
pandemic, the U.S. banking regulators issued an interim final
the period beginning October 1, 2020 and ending on September
rule that, among other things, stipulates PPP loans, which are
30, 2021.
guaranteed by the SBA, will receive a zero percent risk weight
In conjunction with this new requirement, the Federal
under the Basel 3 Advanced and Standardized approaches. The
Reserve has removed the annual CCAR quantitative objection
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rule was later finalized by the U.S. banking regulators on

process beginning with CCAR 2020. While the final rule
October 28, 2020. For more information on the PPP, see
continues to require that the Corporation describe its planned
Executive Summary – Recent Developments – COVID-19
capital distributions in its CCAR capital plan, the Corporation is
Pandemic on page 48 and Note 1 – Summary of Significant
no longer required to seek prior approval if it makes capital
Accounting Principles to the Consolidated Financial Statements.
distributions in excess of those included in its CCAR capital

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Standardized Approach for Measuring Counterparty Credit and nonbank financial institutions regulated by the Federal
Risk Reserve do not breach 15 percent of Tier 1 capital and
On June 30, 2020 the Corporation adopted the new exposures to most other counterparties do not breach 25
standardized approach for measuring counterparty credit risk percent of Tier 1 capital. Certain exposures, including exposures
(SA-CCR), which replaces the current exposure method for to the U.S. government, U.S. government-sponsored entities
calculating the exposure amount of derivative contracts for risk- and qualifying central counterparties, are exempt from the credit
weighted assets and supplementary leverage exposure. limits.
Adoption of SA-CCR resulted in a decrease of approximately $15
billion in the Corporation’s Standardized RWA, and a $66 billion
Regulatory Capital and Securities Regulation
decrease in supplementary leverage exposure. The Corporation’s principal U.S. broker-dealer subsidiaries are
BofA Securities, Inc. (BofAS), Merrill Lynch Professional Clearing
Swap Dealer Capital Requirements Corp. (MLPCC) and Merrill Lynch, Pierce, Fenner & Smith
On July 22, 2020, the U.S. Commodity Futures Trading Incorporated (MLPF&S). The Corporation's principal European
Commission (CFTC) issued a final rule to establish capital broker-dealer subsidiaries are Merrill Lynch International (MLI)
requirements for swap dealers and major swap participants that and BofA Securities Europe SA (BofASE).
are not subject to existing U.S. prudential regulation. Under the The U.S. broker-dealer subsidiaries are subject to the net
rule, applicable subsidiaries of the Corporation would be capital requirements of Rule 15c3-1 under the Exchange Act.
permitted to elect one of two approaches to compute their BofAS computes its minimum capital requirements as an
regulatory capital. The first approach is a bank-based capital alternative net capital broker-dealer under Rule 15c3-1e, and
approach, which requires that firms maintain CET1 capital MLPCC and MLPF&S compute their minimum capital
greater than or equal to 6.5 percent of the entity’s RWA as requirements in accordance with the alternative standard under
calculated under Basel 3, Total capital greater than or equal to Rule 15c3-1. BofAS and MLPCC are also registered as futures
8.0 percent of the entity’s RWA as calculated under Basel 3 and commission merchants and are subject to CFTC Regulation
Total capital greater than or equal to 8.0 percent of the entity’s 1.17. The U.S. broker-dealer subsidiaries are also registered
uncleared swap margin. The second approach is based on net with the Financial Industry Regulatory Authority, Inc. (FINRA).
liquid assets and requires that a firm maintain net capital Pursuant to FINRA Rule 4110, FINRA may impose higher net
greater than or equal to 2.0 percent of its uncleared swap capital requirements than Rule 15c3-1 under the Exchange Act
margin. The final rule also includes reporting requirements. The with respect to each of the broker-dealers.
impact on the Corporation is not expected to be significant. BofAS provides institutional services, and in accordance with
the alternative net capital requirements, is required to maintain
Deduction of Unsecured Debt of G-SIBs tentative net capital in excess of $1.0 billion and net capital in
On October 20, 2020, the Federal Reserve, Federal Deposit excess of the greater of $500 million or a certain percentage of
Insurance Corporation (FDIC) and the Office of the Comptroller its reserve requirement. BofAS must also notify the Securities
of the Currency (U.S. Agencies) finalized a rule requiring and Exchange Commission (SEC) in the event its tentative net
Advanced approaches institutions to deduct from regulatory capital is less than $5.0 billion. BofAS is also required to hold a
capital certain investments in TLAC-eligible long-term debt and certain percentage of its customers' and affiliates' risk-based
other pari passu or subordinated debt instruments issued by G- margin in order to meet its CFTC minimum net capital
SIBs above a specified threshold. The final rule is intended to requirement. At December 31, 2020, BofAS had tentative net
limit the interconnectedness between G-SIBs and is capital of $16.8 billion. BofAS also had regulatory net capital of
complementary to existing regulatory capital requirements that $14.1 billion, which exceeded the minimum requirement of $2.9
generally require banks to deduct investments in the regulatory billion.
capital of financial institutions. The final rule is effective April 1, MLPCC is a fully-guaranteed subsidiary of BofAS and
2021. The impact to the Corporation is not expected to be provides clearing and settlement services as well as prime
significant. brokerage and arranged financing services for institutional
clients. At December 31, 2020, MLPCC’s regulatory net capital
Volcker Rule of $8.6 billion exceeded the minimum requirement of $1.4
Effective January 1, 2020, we became subject to certain billion.
changes to the Volcker Rule, including removing the requirement MLPF&S provides retail services. At December 31, 2020,
for banking organizations to deduct from Tier 1 capital MLPF&S' regulatory net capital was $3.6 billion, which exceeded
ownership interests of covered funds acquired or retained under the minimum requirement of $180 million.
the underwriting or market-making exemptions of the Volcker Our European broker-dealers are regulated by non-U.S.
Rule, which the banking entity did not organize or offer. regulators. MLI, a U.K. investment firm, is regulated by the
Single-Counterparty Credit Limits Prudential Regulation Authority and the FCA and is subject to
The Federal Reserve established single-counterparty credit limits certain regulatory capital requirements. At December 31, 2020,
(SCCL) for BHCs with total consolidated assets of $250 billion MLI’s capital resources were $34.1 billion, which exceeded the
or more. The SCCL rule is designed to ensure that the maximum minimum Pillar 1 requirement of $14.7 billion. BofASE, a French
possible loss that a BHC could incur due to the default of a investment firm, is regulated by the Autorité de Contrôle
single counterparty or a group of connected counterparties Prudentiel et de Résolution and the Autorité des Marchés
would not endanger the BHC’s survival, thereby reducing the Financiers, and is subject to certain regulatory capital
requirements. At December 31, 2020, BofASE's capital
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probability of future financial crises. Beginning January 1, 2020,

G-SIBs must calculate SCCL on a daily basis by dividing the resources were $6.2 billion, which exceeded the minimum Pillar
aggregate net credit exposure to a given counterparty by the G- 1 requirement of $1.9 billion.
SIB’s Tier 1 capital, ensuring that exposures to other G-SIBs

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Liquidity Risk amount equal to the value of the transferred assets. The
aggregate principal amount of the note will increase by the
Funding and Liquidity Risk Management amount of any future asset transfers. NB Holdings also provided
Our primary liquidity risk management objective is to meet the parent company with a committed line of credit that allows
expected or unexpected cash flow and collateral needs while the parent company to draw funds necessary to service near-
continuing to support our businesses and customers under a term cash needs. These arrangements support our preferred
range of economic conditions. To achieve that objective, we single point of entry resolution strategy, under which only the
analyze and monitor our liquidity risk under expected and parent company would be resolved under the U.S. Bankruptcy
stressed conditions, maintain liquidity and access to diverse Code. These arrangements include provisions to terminate the
funding sources, including our stable deposit base, and seek to line of credit, forgive the subordinated note and require the
align liquidity-related incentives and risks. These liquidity risk parent company to transfer its remaining financial assets to NB
management practices have allowed us to effectively manage Holdings if our projected liquidity resources deteriorate so
the market stress from the pandemic that began in the first severely that resolution of the parent company becomes
quarter of 2020. For more information on the effects of the imminent.
pandemic, see Item 1A. Risk Factors of our 2020 Annual Report
Global Liquidity Sources and Other Unencumbered Assets
on Form 10-K and Executive Summary – Recent Developments –
We maintain liquidity available to the Corporation, including the
COVID-19 Pandemic on page 48.
parent company and selected subsidiaries, in the form of cash
We define liquidity as readily available assets, limited to
and high-quality, liquid, unencumbered securities. Our liquidity
cash and high-quality, liquid, unencumbered securities that we
buffer, referred to as Global Liquidity Sources (GLS), is
can use to meet our contractual and contingent financial
comprised of assets that are readily available to the parent
obligations as those obligations arise. We manage our liquidity
company and selected subsidiaries, including holding company,
position through line-of-business and ALM activities, as well as
bank and broker-dealer subsidiaries, even during stressed
through our legal entity funding strategy, on both a forward and
market conditions. Our cash is primarily on deposit with the
current (including intraday) basis under both expected and
Federal Reserve Bank and, to a lesser extent, central banks
stressed conditions. We believe that a centralized approach to
outside of the U.S. We limit the composition of high-quality,
funding and liquidity management enhances our ability to
liquid, unencumbered securities to U.S. government securities,
monitor liquidity requirements, maximizes access to funding
U.S. agency securities, U.S. agency MBS and a select group of
sources, minimizes borrowing costs and facilitates timely
non-U.S. government securities. We can quickly obtain cash for
responses to liquidity events.
these securities, even in stressed conditions, through
The Board approves our liquidity risk policy and the Financial
repurchase agreements or outright sales. We hold our GLS in
Contingency and Recovery Plan. The ERC establishes our
legal entities that allow us to meet the liquidity requirements of
liquidity risk tolerance levels. The MRC is responsible for
our global businesses, and we consider the impact of potential
overseeing liquidity risks and directing management to maintain
regulatory, tax, legal and other restrictions that could limit the
exposures within the established tolerance levels. The MRC
transferability of funds among entities.
reviews and monitors our liquidity position and stress testing
Table 16 presents average GLS for the three months ended
results, approves certain liquidity risk limits and reviews the
December 31, 2020 and 2019.
impact of strategic decisions on our liquidity. For more
information, see Managing Risk on page 70. Under this
governance framework, we have developed certain funding and Table 16 Average Global Liquidity Sources
liquidity risk management practices which include: maintaining
liquidity at the parent company and selected subsidiaries, Three Months Ended
including our bank subsidiaries and other regulated entities; December 31
determining what amounts of liquidity are appropriate for these (Dollars in billions) 2020 2019
Bank entities $ 773 $ 454
entities based on analysis of debt maturities and other potential
Nonbank and other entities (1) 170 122
cash outflows, including those that we may experience during
Total Average Global Liquidity Sources $ 943 $ 576
stressed market conditions; diversifying funding sources, (1)
Nonbank includes Parent, NB Holdings and other regulated entities.
considering our asset profile and legal entity structure; and
performing contingency planning. Our bank subsidiaries’ liquidity is primarily driven by deposit
and lending activity, as well as securities valuation and net debt
NB Holdings Corporation activity. Bank subsidiaries can also generate incremental
We have intercompany arrangements with certain key liquidity by pledging a range of unencumbered loans and
subsidiaries under which we transferred certain assets of Bank securities to certain FHLBs and the Federal Reserve Discount
of America Corporation, as the parent company, which is a Window. The cash we could have obtained by borrowing against
separate and distinct legal entity from our bank and nonbank this pool of specifically-identified eligible assets was $306
subsidiaries, and agreed to transfer certain additional parent billion and $372 billion at December 31, 2020 and 2019. We
company assets not needed to satisfy anticipated near-term have established operational procedures to enable us to borrow
expenditures, to NB Holdings Corporation, a wholly-owned against these assets, including regularly monitoring our total
holding company subsidiary (NB Holdings). The parent company pool of eligible loans and securities collateral. Eligibility is
is expected to continue to have access to the same flow of defined in guidelines from the FHLBs and the Federal Reserve
dividends, interest and other amounts of cash necessary to
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and is subject to change at their discretion. Due to regulatory

service its debt, pay dividends and perform other obligations as restrictions, liquidity generated by the bank subsidiaries can
it would have had if it had not entered into these arrangements generally be used only to fund obligations within the bank
and transferred any assets. subsidiaries, and transfers to the parent company or nonbank
In consideration for the transfer of assets, NB Holdings subsidiaries may be subject to prior regulatory approval.
issued a subordinated note to the parent company in a principal
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Liquidity is also held in nonbank entities, including the liquidity required to maintain businesses and finance customer
Parent, NB Holdings and other regulated entities. Parent activities. Changes in certain market factors, including, but not
company and NB Holdings liquidity is typically in the form of limited to, credit rating downgrades, could negatively impact
cash deposited at BANA and is excluded from the liquidity at potential contractual and contingent outflows and the related
bank subsidiaries. Liquidity held in other regulated entities, financial instruments, and in some cases these impacts could
comprised primarily of broker-dealer subsidiaries, is primarily be material to our financial results.
available to meet the obligations of that entity, and transfers to We consider all sources of funds that we could access
the parent company or to any other subsidiary may be subject to during each stress scenario and focus particularly on matching
prior regulatory approval due to regulatory restrictions and available sources with corresponding liquidity requirements by
minimum requirements. Our other regulated entities also hold legal entity. We also use the stress modeling results to manage
unencumbered investment-grade securities and equities that we our asset and liability profile and establish limits and guidelines
believe could be used to generate additional liquidity. on certain funding sources and businesses.
Table 17 presents the composition of average GLS for the
three months ended December 31, 2020 and 2019. Net Stable Funding Ratio Final Rule
On October 20, 2020, the U.S. Agencies finalized the Net
Stable Funding Ratio (NSFR), a rule requiring large banks to
Table 17 Average Global Liquidity Sources Composition maintain a minimum level of stable funding over a one-year
period. The final rule is intended to support the ability of banks
Three Months Ended to lend to households and businesses in both normal and
December 31
adverse economic conditions and is complementary to the LCR
(Dollars in billions) 2020 2019
Cash on deposit $ 322 $ 103
rule, which focuses on short-term liquidity risks. The final rule is
U.S. Treasury securities 141 98 effective July 1, 2021. The U.S. NSFR would apply to the
U.S. agency securities, mortgage-backed Corporation on a consolidated basis and to our insured
securities, and other investment-grade depository institutions. The Corporation expects to be in
securities 462 358 compliance within the final NSFR rule in the regulatory timeline
Non-U.S. government securities 18 17
provided and does not expect any significant impacts to the
Total Average Global Liquidity Sources $ 943 $ 576
Corporation.
Our GLS are substantially the same in composition to what Diversified Funding Sources
qualifies as High Quality Liquid Assets (HQLA) under the final We fund our assets primarily with a mix of deposits, and
U.S. Liquidity Coverage Ratio (LCR) rules. However, HQLA for secured and unsecured liabilities through a centralized, globally
purposes of calculating LCR is not reported at market value, but coordinated funding approach diversified across products,
at a lower value that incorporates regulatory deductions and the programs, markets, currencies and investor groups.
exclusion of excess liquidity held at certain subsidiaries. The The primary benefits of our centralized funding approach
LCR is calculated as the amount of a financial institution’s include greater control, reduced funding costs, wider name
unencumbered HQLA relative to the estimated net cash outflows recognition by investors and greater flexibility to meet the
the institution could encounter over a 30-day period of variable funding requirements of subsidiaries. Where
significant liquidity stress, expressed as a percentage. Our regulations, time zone differences or other business
average consolidated HQLA, on a net basis, was $584 billion considerations make parent company funding impractical,
and $464 billion for the three months ended December 31, certain other subsidiaries may issue their own debt.
2020 and 2019. For the same periods, the average We fund a substantial portion of our lending activities
consolidated LCR was 122 percent and 116 percent. Our LCR through our deposits, which were $1.80 trillion and $1.43
fluctuates due to normal business flows from customer activity. trillion at December 31, 2020 and 2019. Deposits are primarily
generated by our Consumer Banking, GWIM and Global Banking
Liquidity Stress Analysis
segments. These deposits are diversified by clients, product
We utilize liquidity stress analysis to assist us in determining
type and geography, and the majority of our U.S. deposits are
the appropriate amounts of liquidity to maintain at the parent
insured by the FDIC. We consider a substantial portion of our
company and our subsidiaries to meet contractual and
deposits to be a stable, low-cost and consistent source of
contingent cash outflows under a range of scenarios. The
funding. We believe this deposit funding is generally less
scenarios we consider and utilize incorporate market-wide and
sensitive to interest rate changes, market volatility or changes
Corporation-specific events, including potential credit rating
in our credit ratings than wholesale funding sources. Our lending
downgrades for the parent company and our subsidiaries, and
activities may also be financed through secured borrowings,
more severe events including potential resolution scenarios.
including credit card securitizations and securitizations with
The scenarios are based on our historical experience,
government-sponsored enterprises (GSE), the FHA and private-
experience of distressed and failed financial institutions,
label investors, as well as FHLB loans.
regulatory guidance, and both expected and unexpected future
Our trading activities in other regulated entities are primarily
events.
funded on a secured basis through securities lending and
The types of potential contractual and contingent cash
repurchase agreements, and these amounts will vary based on
outflows we consider in our scenarios may include, but are not
customer activity and market conditions. We believe funding
limited to, upcoming contractual maturities of unsecured debt
these activities in the secured financing markets is more cost-
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and reductions in new debt issuances; diminished access to

efficient and less sensitive to changes in our credit ratings than
secured financing markets; potential deposit withdrawals;
unsecured financing. Repurchase agreements are generally
increased draws on loan commitments, liquidity facilities and
short-term and often overnight. Disruptions in secured financing
letters of credit; additional collateral that counterparties could
markets for financial institutions have occurred in prior market
call if our credit ratings were downgraded; collateral and margin
cycles which resulted in adverse changes in terms or significant
requirements arising from market value changes; and potential
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reductions in the availability of such financing. We manage the Substantially all of our senior and subordinated debt
liquidity risks arising from secured funding by sourcing funding obligations contain no provisions that could trigger a
globally from a diverse group of counterparties, providing a requirement for an early repayment, require additional collateral
range of securities collateral and pursuing longer durations, support, result in changes to terms, accelerate maturity or
when appropriate. For more information on secured financing create additional financial obligations upon an adverse change
agreements, see Note 10 – Federal Funds Sold or Purchased, in our credit ratings, financial ratios, earnings, cash flows or
Securities Financing Agreements, Short-term Borrowings and stock price. For more information on long-term debt funding,
Restricted Cash to the Consolidated Financial Statements. including issuances and maturities and redemptions, see Note
Total long-term debt increased $22.1 billion to $262.9 11 – Long-term Debt to the Consolidated Financial Statements.
billion during 2020, primarily due to debt issuances and We use derivative transactions to manage the duration,
valuation adjustments, partially offset by maturities and interest rate and currency risks of our borrowings, considering
redemptions. We may, from time to time, purchase outstanding the characteristics of the assets they are funding. For more
debt instruments in various transactions, depending on market information on our ALM activities, see Interest Rate Risk
conditions, liquidity and other factors. Our other regulated Management for the Banking Book on page 105.
entities may also make markets in our debt instruments to
provide liquidity for investors. Contingency Planning
During 2020, we issued $56.9 billion of long-term debt We maintain contingency funding plans that outline our potential
consisting of $43.8 billion of notes issued by Bank of America responses to liquidity stress events at various levels of severity.
Corporation, substantially all of which was TLAC compliant, $4.8 These policies and plans are based on stress scenarios and
billion of notes issued by Bank of America, N.A. and $8.3 billion include potential funding strategies and communication and
of other debt. During 2019, we issued $52.5 billion of long-term notification procedures that we would implement in the event we
debt consisting of $29.3 billion of notes issued by Bank of experienced stressed liquidity conditions. We periodically review
America Corporation, substantially all of which was TLAC and test the contingency funding plans to validate efficacy and
compliant, $10.9 billion of notes issued by Bank of America, assess readiness.
N.A. and $12.3 billion of other debt. Our U.S. bank subsidiaries can access contingency funding
During 2020, we had total long-term debt maturities and through the Federal Reserve Discount Window. Certain non-U.S.
redemptions in the aggregate of $47.1 billion consisting of subsidiaries have access to central bank facilities in the
$22.6 billion for Bank of America Corporation, $11.5 billion for jurisdictions in which they operate. While we do not rely on
Bank of America, N.A. and $13.0 billion of other debt. During these sources in our liquidity modeling, we maintain the
2019, we had total long-term debt maturities and redemptions policies, procedures and governance processes that would
in the aggregate of $50.6 billion consisting of $21.1 billion for enable us to access these sources if necessary.
Bank of America Corporation, $19.9 billion for Bank of America,
Credit Ratings
N.A. and $9.6 billion of other debt.
Our borrowing costs and ability to raise funds are impacted by
At December 31, 2020, Bank of America Corporation's
our credit ratings. In addition, credit ratings may be important to
senior notes of $191.2 billion included $146.6 billion of
customers or counterparties when we compete in certain
outstanding notes that are both TLAC eligible and callable at
markets and when we seek to engage in certain transactions,
least one year before their stated maturities. Of these senior
including over-the-counter (OTC) derivatives. Thus, it is our
notes, $12.0 billion will be callable and become TLAC ineligible
objective to maintain high-quality credit ratings, and
during 2021, and $15.3 billion, $14.6 billion, $11.7 billion and
management maintains an active dialogue with the major rating
$13.2 billion will do so during each of 2022 through 2025,
agencies.
respectively, and $79.8 billion thereafter.
Credit ratings and outlooks are opinions expressed by rating
We issue long-term unsecured debt in a variety of maturities
agencies on our creditworthiness and that of our obligations or
and currencies to achieve cost-efficient funding and to maintain
securities, including long-term debt, short-term borrowings,
an appropriate maturity profile. While the cost and availability of
preferred stock and other securities, including asset
unsecured funding may be negatively impacted by general
securitizations. Our credit ratings are subject to ongoing review
market conditions or by matters specific to the financial
by the rating agencies, and they consider a number of factors,
services industry or the Corporation, we seek to mitigate
including our own financial strength, performance, prospects
refinancing risk by actively managing the amount of our
and operations as well as factors not under our control. The
borrowings that we anticipate will mature within any month or
rating agencies could make adjustments to our ratings at any
quarter. We may issue unsecured debt in the form of structured
time, and they provide no assurances that they will maintain our
notes for client purposes, certain of which qualify as TLAC-
ratings at current levels.
eligible debt. During 2020, we issued $7.3 billion of structured
Other factors that influence our credit ratings include
notes, which are unsecured debt obligations that pay investors
changes to the rating agencies’ methodologies for our industry
returns linked to other debt or equity securities, indices,
or certain security types; the rating agencies’ assessment of
currencies or commodities. We typically hedge the returns we
the general operating environment for financial services
are obligated to pay on these liabilities with derivatives and/or
companies; our relative positions in the markets in which we
investments in the underlying instruments, so that from a
compete; our various risk exposures and risk management
funding perspective, the cost is similar to our other unsecured
policies and activities; pending litigation and other
long-term debt. We could be required to settle certain structured
contingencies or potential tail risks; our reputation; our liquidity
note obligations for cash or other securities prior to maturity
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position, diversity of funding sources and funding costs; the

under certain circumstances, which we consider for liquidity
current and expected level and volatility of our earnings; our
planning purposes. We believe, however, that a portion of such
capital position and capital management practices; our
borrowings will remain outstanding beyond the earliest put or
corporate governance; the sovereign credit ratings of the U.S.
redemption date.
government; current or future regulatory and legislative

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initiatives; and the agencies’ views on whether the U.S. changes under criteria observation are the sole result of bank
government would provide meaningful support to the rating criteria changes and do not reflect a change in the
Corporation or its subsidiaries in a crisis. underlying fundamentals of the institution. Fitch’s outlook for all
On April 22, 2020, Fitch Ratings (Fitch) completed its review of our long-term ratings is currently Stable.
of large, complex securities trading and universal banks in the On June 9, 2020, Fitch affirmed its rating for the
U.S., including Bank of America, in response to declining subordinated debt of BANA at A. This rating had remained under
economic activity from the pandemic. The agency affirmed its criteria observation following Fitch’s broader rating actions.
long-term and short-term senior debt ratings for the Corporation On November 18, 2020, Moody’s Investors Service
and all of its rated subsidiaries, except for select issuer and (Moody's) affirmed its long-term and short-term debt ratings for
instrument-level ratings that had previously been placed under the Corporation and all of its rated subsidiaries, which did not
criteria observation on March 4, 2020, following changes in the change during 2020. Moody’s outlook for all of our long-term
agency’s bank rating criteria on February 28, 2020. ratings is currently Stable.
Concurrently, Fitch reached a conclusion on select under- The current ratings and Stable outlooks for the Corporation
criteria-observation designations for the Corporation and and its subsidiaries from Standard & Poor’s Global Ratings also
upgraded its long-term and short-term senior debt ratings of MLI did not change during 2020.
and BofASE by one notch to AA-/F1+. The agency also upgraded Table 18 presents the Corporation’s current long-term/short-
its preferred stock rating for the Corporation by one notch to term senior debt ratings and outlooks expressed by the rating
BBB and downgraded its subordinated debt rating for the agencies.
Corporation by one notch to A-. According to Fitch, rating
Table 18 Senior Debt Ratings

Moody’s Investors Service Standard & Poor’s Global Ratings Fitch Ratings
Long-term Short-term Outlook Long-term Short-term Outlook Long-term Short-term Outlook
Bank of America Corporation A2 P-1 Stable A- A-2 Stable A+ F1 Stable
Bank of America, N.A. Aa2 P-1 Stable A+ A-1 Stable AA- F1+ Stable
Bank of America Europe Designated Activity
Company NR NR NR A+ A-1 Stable AA- F1+ Stable
Merrill Lynch, Pierce, Fenner & Smith
Incorporated NR NR NR A+ A-1 Stable AA- F1+ Stable
BofA Securities, Inc. NR NR NR A+ A-1 Stable AA- F1+ Stable
Merrill Lynch International NR NR NR A+ A-1 Stable AA- F1+ Stable
BofA Securities Europe SA NR NR NR A+ A-1 Stable AA- F1+ Stable
NR = not rated
A reduction in certain of our credit ratings or the ratings of While certain potential impacts are contractual and
certain asset-backed securitizations may have a material quantifiable, the full scope of the consequences of a credit
adverse effect on our liquidity, potential loss of access to credit rating downgrade to a financial institution is inherently
markets, the related cost of funds, our businesses and on uncertain, as it depends upon numerous dynamic, complex and
certain revenues, particularly in those businesses where inter-related factors and assumptions, including whether any
counterparty creditworthiness is critical. In addition, under the downgrade of a company’s long-term credit ratings precipitates
terms of certain OTC derivative contracts and other trading downgrades to its short-term credit ratings, and assumptions
agreements, in the event of downgrades of our or our rated about the potential behaviors of various customers, investors
subsidiaries’ credit ratings, the counterparties to those and counterparties. For more information on potential impacts
agreements may require us to provide additional collateral, or to of credit rating downgrades, see Liquidity Risk – Liquidity Stress
terminate these contracts or agreements, which could cause us Analysis on page 81.
to sustain losses and/or adversely impact our liquidity. If the For more information on additional collateral and termination
short-term credit ratings of our parent company, bank or broker- payments that could be required in connection with certain over-
dealer subsidiaries were downgraded by one or more levels, the the-counter derivative contracts and other trading agreements in
potential loss of access to short-term funding sources such as the event of a credit rating downgrade, see Note 3 – Derivatives
repo financing and the effect on our incremental cost of funds to the Consolidated Financial Statements and Item 1A. Risk
could be material. Factors of our 2020 Annual Report on Form 10-K.
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Common Stock Dividends Credit Risk Management

For a summary of our declared quarterly cash dividends on Credit risk is the risk of loss arising from the inability or failure
common stock during 2020 and through February 24, 2021, of a borrower or counterparty to meet its obligations. Credit risk
see Note 13 – Shareholders’ Equity to the Consolidated can also arise from operational failures that result in an
Financial Statements. erroneous advance, commitment or investment of funds. We
define the credit exposure to a borrower or counterparty as the
Finance Subsidiary Issuers and Parent Guarantor loss potential arising from all product classifications including
BofA Finance LLC, a Delaware limited liability company (BofA loans and leases, deposit overdrafts, derivatives, assets held-
Finance), is a consolidated finance subsidiary of the Corporation for-sale and unfunded lending commitments which include loan
that has issued and sold, and is expected to continue to issue commitments, letters of credit and financial guarantees.
and sell, its senior unsecured debt securities (Guaranteed Derivative positions are recorded at fair value and assets held-
Notes), that are fully and unconditionally guaranteed by the for-sale are recorded at either fair value or the lower of cost or
Corporation. The Corporation guarantees the due and punctual
fair value. Certain loans and unfunded commitments are
payment, on demand, of amounts payable on the Guaranteed
accounted for under the fair value option. Credit risk for
Notes if not paid by BofA Finance. In addition, each of BAC
categories of assets carried at fair value is not accounted for as
Capital Trust XIII and BAC Capital Trust XIV, Delaware statutory
trusts (collectively, the Trusts), is a 100 percent owned finance part of the allowance for credit losses but as part of the fair
subsidiary of the Corporation that has issued and sold trust value adjustments recorded in earnings. For derivative
preferred securities (the Trust Preferred Securities and, together positions, our credit risk is measured as the net cost in the
with the Guaranteed Notes, the Guaranteed Securities) that event the counterparties with contracts in which we are in a gain
remained outstanding at December 31, 2020. The Corporation position fail to perform under the terms of those contracts. We
guarantees the payment of amounts and distributions with use the current fair value to represent credit exposure without
respect to the Trust Preferred Securities if not paid by the giving consideration to future mark-to-market changes. The
Trusts, to the extent of funds held by the Trusts, and this credit risk amounts take into consideration the effects of legally
guarantee, together with the Corporation’s other obligations with enforceable master netting agreements and cash collateral. Our
respect to the Trust Preferred Securities, effectively constitutes consumer and commercial credit extension and review
a full and unconditional guarantee of the Trusts’ payment procedures encompass funded and unfunded credit exposures.
obligations on the Trust Preferred Securities. No other For more information on derivatives and credit extension
subsidiary of the Corporation guarantees the Guaranteed commitments, see Note 3 – Derivatives and Note 12 –
Securities. Commitments and Contingencies to the Consolidated Financial
BofA Finance and each of the Trusts are finance Statements.
subsidiaries, have no independent assets, revenues or We manage credit risk based on the risk profile of the
operations and are dependent upon the Corporation and/or the borrower or counterparty, repayment sources, the nature of
Corporation’s other subsidiaries to meet their respective underlying collateral, and other support given current events,
obligations under the Guaranteed Securities in the ordinary conditions and expectations. We classify our portfolios as either
course. If holders of the Guaranteed Securities make claims on consumer or commercial and monitor credit risk in each as
their Guaranteed Securities in a bankruptcy, resolution or
discussed below.
similar proceeding, any recoveries on those claims will be
We refine our underwriting and credit risk management
limited to those available under the applicable guarantee by the
practices as well as credit standards to meet the changing
Corporation, as described above.
The Corporation is a holding company and depends upon its economic environment. To mitigate losses and enhance
subsidiaries for liquidity. Applicable laws and regulations and customer support in our consumer businesses, we have in
intercompany arrangements entered into in connection with the place collection programs and loan modification and customer
Corporation’s resolution plan could restrict the availability of assistance infrastructures. We utilize a number of actions to
funds from subsidiaries to the Corporation, which could mitigate losses in the commercial businesses including
adversely affect the Corporation’s ability to make payments increasing the frequency and intensity of portfolio monitoring,
under its guarantees. In addition, the obligations of the hedging activity and our practice of transferring management of
Corporation under the guarantees of the Guaranteed Securities deteriorating commercial exposures to independent special
will be structurally subordinated to all existing and future asset officers as credits enter criticized categories.
liabilities of its subsidiaries, and claimants should look only to For information on our credit risk management activities, see
assets of the Corporation for payments. If the Corporation, as Consumer Portfolio Credit Risk Management below, Commercial
guarantor of the Guaranteed Notes, transfers all or substantially Portfolio Credit Risk Management on page 91, Non-U.S.
all of its assets to one or more direct or indirect majority-owned Portfolio on page 97, Allowance for Credit Losses on page 99,
subsidiaries, under the indenture governing the Guaranteed and Note 5 – Outstanding Loans and Leases and Allowance for
Notes, the subsidiary or subsidiaries will not be required to Credit Losses to the Consolidated Financial Statements.
assume the Corporation’s obligations under its guarantee of the During 2020, the pandemic negatively impacted economic
Guaranteed Notes. activity in the U.S. and around the world. In particular, beginning
For more information on factors that may affect payments to in the latter portion of the first quarter of 2020, the pandemic
holders of the Guaranteed Securities, see Liquidity Risk – NB resulted in changes to consumer and business behaviors and
Holdings Corporation in this section, see Item 1. Business of restrictions on economic activity. These restrictions gave rise to
our 2020 Annual Report on Form 10-K and Item 1A. Risk increased unemployment and underemployment, lower business
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Factors of our 2020 Annual Report on Form 10-K. profits, increased business closures and bankruptcies,
fluctuations and disruptions to commercial and consumer
spending and markets, and lower global GDP, all of which
negatively impacted our consumer and commercial credit
portfolio.

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To provide relief to individuals and businesses in the U.S., Consumer Portfolio Credit Risk Management
economic stimulus packages were enacted throughout 2020, Credit risk management for the consumer portfolio begins with
including the CARES Act, an executive order signed in August initial underwriting and continues throughout a borrower’s credit
2020 to establish the Lost Wage Assistance Program, and most cycle. Statistical techniques in conjunction with experiential
recently, the Consolidated Appropriations Act enacted in judgment are used in all aspects of portfolio management
December 2020. In addition, U.S. bank regulatory agencies including underwriting, product pricing, risk appetite, setting
issued interagency guidance to financial institutions that have credit limits, and establishing operating processes and metrics
worked with and continue to work with borrowers affected by to quantify and balance risks and returns. Statistical models are
COVID-19. built using detailed behavioral information from external sources
To support our customers, we implemented various loan such as credit bureaus and/or internal historical experience and
modification programs and other forms of support beginning in are a component of our consumer credit risk management
March 2020, including offering loan payment deferrals, process. These models are used in part to assist in making
refunding certain fees, and pausing foreclosure sales, evictions both new and ongoing credit decisions, as well as portfolio
and repossessions. Since June 2020, we have experienced a management strategies, including authorizations and line
decline in the need for customer assistance as the number of management, collection practices and strategies, and
customer accounts and balances on deferral decreased determination of the allowance for loan and lease losses and
significantly. For information on the accounting for loan allocated capital for credit risk.
modifications related to the pandemic, see Note 1 – Summary of
Significant Accounting Principles to the Consolidated Financial Consumer Credit Portfolio
Statements. While COVID-19 is severely impacting economic activity, and is
Furthermore, as COVID-19 cases eased and initial contributing to increasing nonperforming loans within certain
restrictions lifted, the global economy began to improve. This consumer portfolios, it did not have a significant impact on
improvement, coupled with the aforementioned relief, facilitated consumer portfolio charge-offs during 2020 due to payment
economic recovery, with unemployment dropping from double- deferrals and government stimulus benefits. However, COVID-19
digit highs in the second quarter of 2020 and GDP significantly could lead to adverse impacts to credit quality metrics in future
rebounding in the third quarter of 2020. periods if negative economic conditions continue or worsen.
However, economic recovery remains uneven, with certain During 2020, net charge-offs decreased $334 million to $2.7
sectors of the economy more significantly impacted from the billion primarily due to lower credit card losses.
pandemic (e.g., travel and entertainment). As a result, we have The consumer allowance for loan and lease losses
experienced increases in commercial reservable criticized increased $5.5 billion in 2020 to $10.1 billion due to the
utilized exposures driven by industries most heavily impacted by adoption of the new CECL accounting standard and deterioration
COVID-19. Also, we have seen modest increases in in the economic outlook resulting from the impact of COVID-19.
nonperforming loans driven by commercial loans and consumer For more information, see Allowance for Credit Losses on page
real estate customer deferral activities, though consumer 99.
charge-offs remained low during 2020 due to payment deferrals For more information on our accounting policies regarding
and government stimulus benefits. delinquencies, nonperforming status, charge-offs, TDRs for the
The pandemic and its full impact on the global economy consumer portfolio, as well as interest accrual policies and
continue to be highly uncertain. While COVID-19 cases have delinquency status for loan modifications related to the
begun to ease from their January 2021 peak, the spread of pandemic, see Note 1 – Summary of Significant Accounting
new, more contagious variants could impact the magnitude and Principles and Note 5 – Outstanding Loans and Leases and
duration of this health crisis. However, ongoing virus Allowance for Credit Losses to the Consolidated Financial
containment efforts and vaccination progress, as well as the Statements.
possibility of further government stimulus, could accelerate the Table 19 presents our outstanding consumer loans and
macroeconomic recovery. For more information on how the leases, consumer nonperforming loans and accruing consumer
pandemic may affect our operations, see Executive Summary – loans past due 90 days or more.
Recent Developments – COVID-19 Pandemic on page 48 and
Item 1A. Risk Factors of our 2020 Annual Report on Form 10-K.
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Table 19 Consumer Credit Quality

Accruing Past Due
Outstandings Nonperforming 90 Days or More
December 31
(Dollars in millions) 2020 2019 2020 2019 2020 2019
Residential mortgage (1) $ 223,555 $ 236,169 $ 2,005 $ 1,470 $ 762 $ 1,088
Home equity 34,311 40,208 649 536 — —
Credit card 78,708 97,608 n/a n/a 903 1,042
Direct/Indirect consumer (2) 91,363 90,998 71 47 33 33
Other consumer 124 192 — — — —
Consumer loans excluding loans accounted for under the fair
value option $ 428,061 $ 465,175 $ 2,725 $ 2,053 $ 1,698 $ 2,163
Loans accounted for under the fair value option (3) 735 594
Total consumer loans and leases $ 428,796 $ 465,769
Percentage of outstanding consumer loans and leases (4) n/a n/a 0.64 % 0.44 % 0.40 % 0.47 %
Percentage of outstanding consumer loans and leases,
excluding fully-insured loan portfolios (4) n/a n/a 0.65 0.46 0.22 0.24
(1)
Residential mortgage loans accruing past due 90 days or more are fully-insured loans. At December 31, 2020 and 2019, residential mortgage includes $537 million and $740 million of loans on
which interest had been curtailed by the FHA, and therefore were no longer accruing interest, although principal was still insured, and $225 million and $348 million of loans on which interest was
still accruing.
(2)
Outstandings primarily include auto and specialty lending loans and leases of $46.4 billion and $50.4 billion, U.S. securities-based lending loans of $41.1 billion and $36.7 billion and non-U.S.
consumer loans of $3.0 billion and $2.8 billion at December 31, 2020 and 2019.
(3)
Consumer loans accounted for under the fair value option include residential mortgage loans of $298 million and $257 million and home equity loans of $437 million and $337 million at
December 31, 2020 and 2019. For more information on the fair value option, see Note 21 – Fair Value Option to the Consolidated Financial Statements.
(4)
Excludes consumer loans accounted for under the fair value option. At December 31, 2020 and 2019, $11 million and $6 million of loans accounted for under the fair value option were past due
90 days or more and not accruing interest.
Table 20 presents net charge-offs and related ratios for consumer loans and leases.
Table 20 Consumer Net Charge-offs and Related Ratios

Net Charge-offs Net Charge-off Ratios (1)
(Dollars in millions) 2020 2019 2020 2019
Residential mortgage $ (30) $ (47) (0.01)% (0.02)%
Home equity (73) (358) (0.19) (0.81)
Credit card 2,349 2,948 2.76 3.12
Direct/Indirect consumer 122 209 0.14 0.23
Other consumer 284 234 n/m n/m
Total $ 2,652 $ 2,986 0.59 0.66
(1)
Net charge-off ratios are calculated as net charge-offs divided by average outstanding loans and leases excluding loans accounted for under the fair value option.
Table 21 presents outstandings, nonperforming balances, are characterized as core loans. All other loans are generally
net charge-offs, allowance for credit losses and provision for characterized as non-core loans and represent runoff portfolios.
credit losses for the core and non-core portfolios within the Core loans as reported in Table 21 include loans held in the
consumer real estate portfolio. We categorize consumer real Consumer Banking and GWIM segments, as well as loans held
estate loans as core and non-core based on loan and customer for ALM activities in All Other.
characteristics such as origination date, product type, loan-to As shown in Table 21, outstanding core consumer real
value (LTV), Fair Isaac Corporation (FICO) score and delinquency estate loans decreased $15.4 billion during 2020 driven by a
status consistent with our current consumer and mortgage decrease of $10.5 billion in residential mortgage and a $4.9
servicing strategy. Generally, loans that were originated after billion decrease in home equity.
January 1, 2010, qualified under GSE underwriting guidelines,
or otherwise met our underwriting guidelines in place in 2015
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Table 21 Consumer Real Estate Portfolio (1)

Outstandings Nonperforming
December 31 Net Charge-offs
Core portfolio
Residential mortgage $ 215,273 $ 225,770 $ 1,390 $ 883 $ (25) $ 7
Home equity 30,328 35,226 462 363 (6) 51
Total core portfolio 245,601 260,996 1,852 1,246 (31) 58
Non-core portfolio
Residential mortgage 8,282 10,399 615 587 (5) (54)
Home equity 3,983 4,982 187 173 (67) (409)
Total non-core portfolio 12,265 15,381 802 760 (72) (463)
Consumer real estate portfolio
Residential mortgage 223,555 236,169 2,005 1,470 (30) (47)
Home equity 34,311 40,208 649 536 (73) (358)
Total consumer real estate portfolio $ 257,866 $ 276,377 $ 2,654 $ 2,006 $ (103) $ (405)
Allowance for Loan

and Lease Losses Provision for Loan
December 31 and Lease Losses
2020 2019 2020 2019
Core portfolio
Residential mortgage $ 374 $ 229 $ 136 $ 22
Home equity 599 120 135 (58)
Total core portfolio 973 349 271 (36)
Non-core portfolio
Residential mortgage 85 96 75 (134)
Home equity (2) (63) 101 (21) (510)
Total non-core portfolio 22 197 54 (644)
Consumer real estate portfolio
Residential mortgage 459 325 211 (112)
Home equity (3) 536 221 114 (568)
Total consumer real estate portfolio $ 995 $ 546 $ 325 $ (680)
(1)
Outstandings and nonperforming loans exclude loans accounted for under the fair value option. Consumer loans accounted for under the fair value option include residential mortgage loans of
$298 million and $257 million and home equity loans of $437 million and $337 million at December 31, 2020 and 2019. For more information, see Note 21 – Fair Value Option to the
(2)
The home equity non-core allowance is in a negative position at December 31, 2020 as it includes expected recoveries of amounts previously charged off.
(3)
Home equity allowance includes a reserve for unfunded lending commitments of $137 million at December 31, 2020.
We believe that the presentation of information adjusted to repurchased pursuant to our servicing agreements with the
exclude the impact of the fully-insured loan portfolio and loans Government National Mortgage Association as well as loans
accounted for under the fair value option is more representative repurchased related to our representations and warranties.
of the ongoing operations and credit quality of the business. As Outstanding balances in the residential mortgage portfolio
a result, in the following tables and discussions of the decreased $12.6 billion in 2020 as both loan sales and
residential mortgage and home equity portfolios, we exclude paydowns were partially offset by originations.
loans accounted for under the fair value option and provide At December 31, 2020 and 2019, the residential mortgage
information that excludes the impact of the fully-insured loan portfolio included $11.8 billion and $18.7 billion of outstanding
portfolio in certain credit quality statistics. fully-insured loans, of which $2.8 billion and $11.2 billion had
FHA insurance, with the remainder protected by Fannie Mae
Residential Mortgage long-term standby agreements. The decline was primarily driven
The residential mortgage portfolio made up the largest by sales of loans with FHA insurance during 2020.
percentage of our consumer loan portfolio at 52 percent of Table 22 presents certain residential mortgage key credit
consumer loans and leases at December 31, 2020. statistics on both a reported basis and excluding the fully-
Approximately 52 percent of the residential mortgage portfolio insured loan portfolio. The following discussion presents the
was in Consumer Banking and 40 percent was in GWIM. The residential mortgage portfolio excluding the fully-insured loan
remaining portion was in All Other and was comprised of loans portfolio.
used in our overall ALM activities, delinquent FHA loans
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Table 22 Residential Mortgage – Key Credit Statistics

Reported Basis (1) Excluding Fully-insured Loans (1)
December 31
Outstandings $ 223,555 $ 236,169 $ 211,737 $ 217,479
Accruing past due 30 days or more 2,314 3,108 1,224 1,296
Accruing past due 90 days or more 762 1,088 — —
Nonperforming loans (2) 2,005 1,470 2,005 1,470
Percent of portfolio
Refreshed LTV greater than 90 but less than or equal to 100 2% 2% 1% 2%
Refreshed LTV greater than 100 1 1 1 1
Refreshed FICO below 620 2 3 1 2
2006 and 2007 vintages (3) 3 4 3 4
(1)
Outstandings, accruing past due, nonperforming loans and percentages of portfolio exclude loans accounted for under the fair value option. For information on our interest accrual policies and
delinquency status for loan modifications related to the pandemic, see Note 1 – Summary of Significant Accounting Principles to the Consolidated Financial Statements.
(2)
Includes loans that are contractually current which primarily consist of collateral-dependent TDRs, including those that have been discharged in Chapter 7 bankruptcy and loans that have not yet
demonstrated a sustained period of payment performance following a TDR.
(3)
These vintages of loans accounted for $503 million and $365 million, or 25 percent, of nonperforming residential mortgage loans at both December 31, 2020 and 2019.
Nonperforming outstanding balances in the residential the amortization period were accruing past due 30 days or more
mortgage portfolio increased $535 million in 2020 primarily compared to $1.2 billion, or less than one percent, for the
driven by COVID-19 deferral activity, as well as the inclusion of entire residential mortgage portfolio. In addition, at
certain loans that, upon adoption of the new credit loss December 31, 2020, $356 million, or six percent, of
standard, became accounted for on an individual basis, which outstanding interest-only residential mortgage loans that had
previously had been accounted for under a pool basis. Of the entered the amortization period were nonperforming, of which
nonperforming residential mortgage loans at December 31, $96 million were contractually current, compared to $2.0 billion,
2020, $892 million, or 45 percent, were current on contractual or one percent, for the entire residential mortgage portfolio.
payments. Loans accruing past due 30 days or more decreased Loans that have yet to enter the amortization period in our
$72 million. interest-only residential mortgage portfolio are primarily well-
Net charge-offs increased $17 million to a net recovery of collateralized loans to our wealth management clients and have
$30 million in 2020 compared to a net recovery of $47 million an interest-only period of three to ten years. Approximately 98
in 2019. This increase is due largely to lower recoveries from percent of these loans that have yet to enter the amortization
the sales of previously charged-off loans. period will not be required to make a fully-amortizing payment
Of the $211.7 billion in total residential mortgage loans until 2022 or later.
outstanding at December 31, 2020, as shown in Table 22, 27 Table 23 presents outstandings, nonperforming loans and
percent were originated as interest-only loans. The outstanding net charge-offs by certain state concentrations for the
balance of interest-only residential mortgage loans that have residential mortgage portfolio. The Los Angeles-Long Beach-
entered the amortization period was $5.9 billion, or 10 percent, Santa Ana Metropolitan Statistical Area (MSA) within California
at December 31, 2020. Residential mortgage loans that have represented 16 percent of outstandings at both December 31,
entered the amortization period generally have experienced a 2020 and 2019. In the New York area, the New York-Northern
higher rate of early stage delinquencies and nonperforming New Jersey-Long Island MSA made up 14 percent and 13
status compared to the residential mortgage portfolio as a percent of outstandings at December 31, 2020 and 2019.
whole. At December 31, 2020, $113 million, or two percent of
outstanding interest-only residential mortgages that had entered
Table 23 Residential Mortgage State Concentrations
Outstandings (1) Nonperforming (1)

California $ 83,185 $ 88,998 $ 570 $ 274 $ (18) $ (22)
New York 23,832 22,385 272 196 3 5
Florida 13,017 12,833 175 143 (5) (12)
Texas 8,868 8,943 78 65 — 1
New Jersey 8,806 8,734 98 77 (1) (4)
Other 74,029 75,586 812 715 (9) (15)
Residential mortgage loans $ 211,737 $ 217,479 $ 2,005 $ 1,470 $ (30) $ (47)
Fully-insured loan portfolio 11,818 18,690
Total residential mortgage loan portfolio $ 223,555 $ 236,169
(1)
Outstandings and nonperforming loans exclude loans accounted for under the fair value option.
Home Equity convert to 15- or 20-year amortizing loans. We no longer

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At December 31, 2020, the home equity portfolio made up eight originate home equity loans or reverse mortgages.
percent of the consumer portfolio and was comprised of home At December 31, 2020, 80 percent of the home equity
equity lines of credit (HELOCs), home equity loans and reverse portfolio was in Consumer Banking, 12 percent was in All Other
mortgages. HELOCs generally have an initial draw period of 10 and the remainder of the portfolio was primarily in GWIM.
years, and after the initial draw period ends, the loans generally Outstanding balances in the home equity portfolio decreased

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$5.9 billion in 2020 primarily due to paydowns outpacing new $5.9 billion, or 17 percent, of our total home equity portfolio.
originations and draws on existing lines. Of the total home Unused HELOCs totaled $42.3 billion and $43.6 billion at
equity portfolio at December 31, 2020 and 2019, $13.8 billion, December 31, 2020 and 2019. The HELOC utilization rate was
or 40 percent, and $15.0 billion, or 37 percent, were in first-lien 43 percent and 46 percent at December 31, 2020 and 2019.
positions. At December 31, 2020, outstanding balances in the Table 24 presents certain home equity portfolio key credit
home equity portfolio that were in a second-lien or more junior- statistics.
lien position and where we also held the first-lien loan totaled
Table 24 Home Equity – Key Credit Statistics (1)

December 31
Outstandings $ 34,311 $ 40,208
Accruing past due 30 days or more (2) 186 218
Nonperforming loans (2, 3) 649 536
Percent of portfolio
Refreshed CLTV greater than 90 but less than or equal to 100 1% 1%
Refreshed CLTV greater than 100 1 2
Refreshed FICO below 620 3 3
2006 and 2007 vintages (4) 16 18
(1)
Outstandings, accruing past due, nonperforming loans and percentages of the portfolio exclude loans accounted for under the fair value option. For information on our interest accrual policies and
delinquency status for loan modifications related to the pandemic, see Note 1 – Summary of Significant Accounting Principles to the Consolidated Financial Statements.
(2)
Accruing past due 30 days or more include $25 million and $30 million and nonperforming loans include $88 million and $57 million of loans where we serviced the underlying first lien at
(3)
Includes loans that are contractually current which primarily consist of collateral-dependent TDRs, including those that have been discharged in Chapter 7 bankruptcy, junior-lien loans where the
underlying first lien is 90 days or more past due, as well as loans that have not yet demonstrated a sustained period of payment performance following a TDR.
(4)
These vintages of loans accounted for 36 percent and 34 percent of nonperforming home equity loans at December 31, 2020 and 2019.
Nonperforming outstanding balances in the home equity days or more. In addition, at December 31, 2020, $477 million,
portfolio increased $113 million during 2020 primarily driven by or five percent, were nonperforming. Loans that have yet to
COVID-19 deferral activity. Of the nonperforming home equity enter the amortization period in our interest-only portfolio are
loans at December 31, 2020, $259 million, or 40 percent, were primarily post-2008 vintages and generally have better credit
current on contractual payments. In addition, $237 million, or quality than the previous vintages that had entered the
36 percent, of nonperforming home equity loans were 180 days amortization period. We communicate to contractually current
or more past due and had been written down to the estimated customers more than a year prior to the end of their draw period
fair value of the collateral, less costs to sell. Accruing loans that to inform them of the potential change to the payment structure
were 30 days or more past due decreased $32 million in 2020. before entering the amortization period, and provide payment
Net charge-offs increased $285 million to a net recovery of options to customers prior to the end of the draw period.
$73 million in 2020 compared to a net recovery of $358 million Although we do not actively track how many of our home
in 2019 as the prior-year period included recoveries from non- equity customers pay only the minimum amount due on their
core home equity loan sales. home equity loans and lines, we can infer some of this
Of the $34.3 billion in total home equity portfolio information through a review of our HELOC portfolio that we
outstandings at December 31, 2020, as shown in Table 24, 15 service and that is still in its revolving period. During 2020, nine
percent require interest-only payments. The outstanding balance percent of these customers with an outstanding balance did not
of HELOCs that have reached the end of their draw period and pay any principal on their HELOCs.
have entered the amortization period was $9.2 billion at Table 25 presents outstandings, nonperforming balances and
December 31, 2020. The HELOCs that have entered the net charge-offs by certain state concentrations for the home
amortization period have experienced a higher percentage of equity portfolio. In the New York area, the New York-Northern
early stage delinquencies and nonperforming status when New Jersey-Long Island MSA made up 13 percent of the
compared to the HELOC portfolio as a whole. At December 31, outstanding home equity portfolio at both December 31, 2020
2020, $121 million, or one percent of outstanding HELOCs that and 2019. The Los Angeles-Long Beach-Santa Ana MSA within
had entered the amortization period were accruing past due 30 California made up 11 percent of the outstanding home equity
portfolio at both December 31, 2020 and 2019.
Table 25 Home Equity State Concentrations

Outstandings (1) Nonperforming (1)
California $ 9,488 $ 11,232 $ 143 $ 101 $ (26) $ (117)
Florida 3,715 4,327 80 71 (11) (74)
New Jersey 2,749 3,216 67 56 (3) (8)
New York 2,495 2,899 103 85 (1) (1)
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Massachusetts 1,719 2,023 32 29 (1) (5)

Other 14,145 16,511 224 194 (31) (153)
Total home equity loan portfolio $ 34,311 $ 40,208 $ 649 $ 536 $ (73) $ (358)
(1)
Outstandings and nonperforming loans exclude loans accounted for under the fair value option.

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Credit Card or more past due and still accruing interest decreased $346
At December 31, 2020, 97 percent of the credit card portfolio million, and loans 90 days or more past due and still accruing
was managed in Consumer Banking with the remainder in GWIM. interest decreased $139 million primarily due to government
Outstandings in the credit card portfolio decreased $18.9 billion stimulus benefits and declines in loan balances.
in 2020 to $78.7 billion due to lower retail spending and higher Unused lines of credit for credit card increased to $342.4
payments. Net charge-offs decreased $599 million to $2.3 billion at December 31, 2020 from $336.9 billion in 2019.
billion during 2020 compared to net charge-offs of $2.9 billion Table 26 presents certain state concentrations for the credit
in 2019 due to government stimulus benefits and payment card portfolio.
deferrals associated with COVID-19. Credit card loans 30 days
Table 26 Credit Card State Concentrations

Accruing Past Due
Outstandings 90 Days or More (1)
California $ 12,543 $ 16,135 $ 166 $ 178 $ 419 $ 526
Florida 7,666 9,075 135 135 306 363
Texas 6,499 7,815 87 93 202 241
New York 4,654 5,975 76 80 188 243
Washington 3,685 4,639 21 26 56 71
Other 43,661 53,969 418 530 1,178 1,504
Total credit card portfolio $ 78,708 $ 97,608 $ 903 $ 1,042 $ 2,349 $ 2,948
(1)
For information on our interest accrual policies and delinquency status for loan modifications related to the pandemic, see Note 1 – Summary of Significant Accounting Principles to the
Direct/Indirect Consumer in the direct/indirect portfolio increased $365 million in 2020 to

At December 31, 2020, 51 percent of the direct/indirect $91.4 billion primarily due to increases in securities-based
portfolio was included in Consumer Banking (consumer auto and lending offset by lower originations in Auto.
recreational vehicle lending) and 49 percent was included in Table 27 presents certain state concentrations for the
GWIM (principally securities-based lending loans). Outstandings direct/indirect consumer loan portfolio.
Table 27 Direct/Indirect State Concentrations

Accruing Past Due
Outstandings 90 Days or More (1)
California $ 12,248 $ 11,912 $ 6 $ 4 $ 20 $ 49
Florida 10,891 10,154 4 4 20 27
Texas 8,981 9,516 6 5 20 29
New York 6,609 6,394 2 1 9 12
New Jersey 3,572 3,468 — 1 2 4
Other 49,062 49,554 15 18 51 88
Total direct/indirect loan portfolio $ 91,363 $ 90,998 $ 33 $ 33 $ 122 $ 209
(1)
Nonperforming Consumer Loans, Leases and Foreclosed loans classified as nonperforming loans in accordance with
Properties Activity applicable policies.
Table 28 presents nonperforming consumer loans, leases and Foreclosed properties decreased $106 million in 2020 to
foreclosed properties activity during 2020 and 2019. During $123 million as the Corporation has paused formal loan
2020, nonperforming consumer loans increased $672 million to foreclosure proceedings and foreclosure sales for occupied
$2.7 billion primarily driven by COVID-19 deferral activity, as well properties during 2020.
as the inclusion of $144 million of certain loans that were Nonperforming loans also include certain loans that have
previously classified as purchased credit-impaired loans and been modified in TDRs where economic concessions have been
accounted for under a pool basis. granted to borrowers experiencing financial difficulties.
At December 31, 2020, $892 million, or 33 percent of Nonperforming TDRs are included in Table 28. For more
nonperforming loans were 180 days or more past due and had information on our loan modification programs offered in
been written down to their estimated property value less costs response to the pandemic, most of which are not TDRs, see
to sell. In addition, at December 31, 2020, $1.2 billion, or 45 Executive Summary – Recent Developments – COVID-19
Pandemic on page 48 and Note 1 – Summary of Significant
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percent of nonperforming consumer loans were modified and

are now current after successful trial periods, or are current Accounting Principles to the Consolidated Financial Statements.

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Table 28 Nonperforming Consumer Loans, Leases and Foreclosed Properties Activity

Nonperforming loans and leases, January 1 $ 2,053 $ 3,842
Additions 2,278 1,407
Reductions:
Paydowns and payoffs (440) (701)
Sales (38) (1,523)
Returns to performing status (1) (1,014) (766)
Charge-offs (78) (111)
Transfers to foreclosed properties (36) (95)
Total net additions/(reductions) to nonperforming loans and leases 672 (1,789)
Total nonperforming loans and leases, December 31 2,725 2,053
Foreclosed properties, December 31 (2) 123 229
Nonperforming consumer loans, leases and foreclosed properties, December 31 $ 2,848 $ 2,282
Nonperforming consumer loans and leases as a percentage of outstanding consumer loans and leases (3) 0.64 % 0.44 %
Nonperforming consumer loans, leases and foreclosed properties as a percentage of outstanding consumer loans, leases and
foreclosed properties (3) 0.66 0.49
(1)
Consumer loans may be returned to performing status when all principal and interest is current and full repayment of the remaining contractual principal and interest is expected, or when the loan
otherwise becomes well-secured and is in the process of collection.
(2)
Foreclosed property balances do not include properties insured by certain government-guaranteed loans, principally FHA-insured, of $119 million and $260 million at December 31, 2020 and
2019.
(3)
Outstanding consumer loans and leases exclude loans accounted for under the fair value option.
Table 29 presents TDRs for the consumer real estate portfolio. Performing TDR balances are excluded from nonperforming loans
and leases in Table 28. For more information on our loan modification programs offered in response to the pandemic, most of which
are not TDRs, see Executive Summary – Recent Developments – COVID-19 Pandemic on page 48 and Note 1 – Summary of
Significant Accounting Principles to the Consolidated Financial Statements.
Table 29 Consumer Real Estate Troubled Debt Restructurings

December 31, 2020 December 31, 2019
(Dollars in millions) Nonperforming Performing Total Nonperforming Performing Total
Residential mortgage (1, 2) $ 1,195 $ 2,899 $ 4,094 $ 921 $ 3,832 $ 4,753
Home equity (3) 248 836 1,084 252 977 1,229
Total consumer real estate troubled debt restructurings $ 1,443 $ 3,735 $ 5,178 $ 1,173 $ 4,809 $ 5,982
(1)
At December 31, 2020 and 2019, residential mortgage TDRs deemed collateral dependent totaled $1.4 billion and $1.2 billion, and included $1.0 billion and $748 million of loans classified as
nonperforming and $361 million and $468 million of loans classified as performing.
(2)
At December 31, 2020 and 2019, residential mortgage performing TDRs include $1.5 billion and $2.1 billion of loans that were fully-insured.
(3) At December 31, 2020 and 2019, home equity TDRs deemed collateral dependent totaled $407 million and $442 million, and include $216 million and $209 million of loans classified as
nonperforming and $191 million and $233 million of loans classified as performing.
In addition to modifying consumer real estate loans, we work borrower or counterparty relationship. We use a variety of tools
with customers who are experiencing financial difficulty by to continuously monitor the ability of a borrower or counterparty
modifying credit card and other consumer loans. Credit card and to perform under its obligations. We use risk rating aggregations
other consumer loan modifications generally involve a reduction to measure and evaluate concentrations within portfolios. In
in the customer’s interest rate on the account and placing the addition, risk ratings are a factor in determining the level of
customer on a fixed payment plan not exceeding 60 months. allocated capital and the allowance for credit losses.
Modifications of credit card and other consumer loans are As part of our ongoing risk mitigation initiatives, we attempt
made through programs utilizing direct customer contact, but to work with clients experiencing financial difficulty to modify
may also utilize external programs. At December 31, 2020 and their loans to terms that better align with their current ability to
2019, our credit card and other consumer TDR portfolio was pay. In situations where an economic concession has been
$701 million and $679 million, of which $614 million and $570 granted to a borrower experiencing financial difficulty, we identify
million were current or less than 30 days past due under the these loans as TDRs. For more information on our accounting
modified terms. policies regarding delinquencies, nonperforming status and net
charge-offs for the commercial portfolio, see Note 1 – Summary
Commercial Portfolio Credit Risk Management of Significant Accounting Principles to the Consolidated Financial
Credit risk management for the commercial portfolio begins with Statements.
an assessment of the credit risk profile of the borrower or
counterparty based on an analysis of its financial position. As Management of Commercial Credit Risk
part of the overall credit risk assessment, our commercial credit Concentrations
exposures are assigned a risk rating and are subject to approval Commercial credit risk is evaluated and managed with the goal
based on defined credit approval standards. Subsequent to loan that concentrations of credit exposure continue to be aligned
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origination, risk ratings are monitored on an ongoing basis, and with our risk appetite. We review, measure and manage
if necessary, adjusted to reflect changes in the financial concentrations of credit exposure by industry, product,
condition, cash flow, risk profile or outlook of a borrower or geography, customer relationship and loan size. We also review,
counterparty. In making credit decisions, we consider risk rating, measure and manage commercial real estate loans by
collateral, country, industry and single-name concentration limits geographic location and property type. In addition, within our
while also balancing these considerations with the total
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non-U.S. portfolio, we evaluate exposures by region and by and commercial clients contributing to the $67.2 billion loan
country. Tables 34, 37 and 40 summarize our concentrations. growth in the first quarter of 2020 have largely been repaid, as
We also utilize syndications of exposure to third parties, loan emergency or contingent funding was no longer needed or
sales, hedging and other risk mitigation techniques to manage clients were able to access capital markets. Additionally, as part
the size and risk profile of the commercial credit portfolio. For of the CARES Act, we had $22.7 billion of PPP loans
more information on our industry concentrations, see outstanding with our small business clients at December 31,
Commercial Portfolio Credit Risk Management – Industry 2020, which are included in U.S. small business commercial in
Concentrations on page 95 and Table 37. the tables in this section. For more information on PPP loans,
We account for certain large corporate loans and loan see Note 1 – Summary of Significant Accounting Principles to the
commitments, including issued but unfunded letters of credit Consolidated Financial Statements.
which are considered utilized for credit risk management Credit quality of commercial real estate borrowers has begun
purposes, that exceed our single-name credit risk concentration to stabilize in many sectors as certain economies have
guidelines under the fair value option. Lending commitments, reopened. Certain sectors, including hospitality and retail,
both funded and unfunded, are actively managed and continue to be negatively impacted as a result of COVID-19.
monitored, and as appropriate, credit risk for these lending Moreover, many real estate markets, while improving, are still
relationships may be mitigated through the use of credit experiencing some disruptions in demand, supply chain
derivatives, with our credit view and market perspectives challenges and tenant difficulties.
determining the size and timing of the hedging activity. In The commercial allowance for loan and lease losses
addition, we purchase credit protection to cover the funded increased $3.9 billion during 2020 to $8.7 billion due to the
portion as well as the unfunded portion of certain other credit deterioration in the economic outlook resulting from the impact
exposures. To lessen the cost of obtaining our desired credit of COVID-19. For more information, see Allowance for Credit
protection levels, credit exposure may be added within an Losses on page 99.
industry, borrower or counterparty group by selling protection. Total commercial utilized credit exposure decreased $15.0
These credit derivatives do not meet the requirements for billion during 2020 to $620.3 billion driven by lower loans and
treatment as accounting hedges. They are carried at fair value leases. The utilization rate for loans and leases, SBLCs and
with changes in fair value recorded in other income. financial guarantees, and commercial letters of credit, in the
In addition, we are a member of various securities and aggregate, was 57 percent at December 31, 2020 and 58
derivative exchanges and clearinghouses, both in the U.S. and percent at December 31, 2019.
other countries. As a member, we may be required to pay a pro- Table 30 presents commercial credit exposure by type for
rata share of the losses incurred by some of these utilized, unfunded and total binding committed credit exposure.
organizations as a result of another member default and under Commercial utilized credit exposure includes SBLCs and
other loss scenarios. For more information, see Note 12 – financial guarantees and commercial letters of credit that have
Commitments and Contingencies to the Consolidated Financial been issued and for which we are legally bound to advance
Statements. funds under prescribed conditions during a specified time
period, and excludes exposure related to trading account
Commercial Credit Portfolio assets. Although funds have not yet been advanced, these
During 2020, commercial asset quality weakened as a result of exposure types are considered utilized for credit risk
the economic impact from COVID-19. However, there were also management purposes.
positive signs during this period. The draws by large corporate
Table 30 Commercial Credit Exposure by Type

Commercial Utilized (1) Commercial Unfunded (2, 3, 4) Total Commercial Committed
December 31
Loans and leases $ 499,065 $ 517,657 $ 404,740 $ 405,834 $ 903,805 $ 923,491
Derivative assets (5) 47,179 40,485 — — 47,179 40,485
Standby letters of credit and financial guarantees 34,616 36,062 538 468 35,154 36,530
Debt securities and other investments 22,618 25,546 4,827 5,101 27,445 30,647
Loans held-for-sale 8,378 7,047 9,556 15,135 17,934 22,182
Operating leases 6,424 6,660 — — 6,424 6,660
Commercial letters of credit 855 1,049 280 451 1,135 1,500
Other 1,168 800 — — 1,168 800
Total $ 620,303 $ 635,306 $ 419,941 $ 426,989 $ 1,040,244 $ 1,062,295
(1)
Commercial utilized exposure includes loans of $5.9 billion and $7.7 billion and issued letters of credit with a notional amount of $89 million and $170 million accounted for under the fair value
option at December 31, 2020 and 2019.
(2)
Commercial unfunded exposure includes commitments accounted for under the fair value option with a notional amount of $3.9 billion and $4.2 billion at December 31, 2020 and 2019.
(3)
Excludes unused business card lines, which are not legally binding.
(4)
Includes the notional amount of unfunded legally binding lending commitments net of amounts distributed (i.e., syndicated or participated) to other financial institutions. The distributed amounts
were $10.5 billion and $10.6 billion at December 31, 2020 and 2019.
(5)
Derivative assets are carried at fair value, reflect the effects of legally enforceable master netting agreements and have been reduced by cash collateral of $42.5 billion and $33.9 billion at
December 31, 2020 and 2019. Not reflected in utilized and committed exposure is additional non-cash derivative collateral held of $39.3 billion and $35.2 billion at December 31, 2020 and
2019, which consists primarily of other marketable securities.
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Outstanding commercial loans and leases decreased $18.6 reservable criticized utilized exposure increased $27.2 billion
billion during 2020 primarily driven by repayments due in part to spread across several industries, including travel and
reduced working capital needs and a favorable capital markets entertainment, as a result of weaker economic conditions
environment, partially offset by $22.7 billion of PPP loans arising from COVID-19. Table 31 presents our commercial loans
outstanding at December 31, 2020. Nonperforming commercial and leases portfolio and related credit quality information at
loans increased $728 million across industries, and commercial December 31, 2020 and 2019.
Table 31 Commercial Credit Quality

Accruing Past Due
Outstandings Nonperforming 90 Days or More (3)
December 31
Commercial and industrial:
U.S. commercial $ 288,728 $ 307,048 $ 1,243 $ 1,094 $ 228 $ 106
Non-U.S. commercial 90,460 104,966 418 43 10 8
Total commercial and industrial 379,188 412,014 1,661 1,137 238 114
Commercial real estate 60,364 62,689 404 280 6 19
Commercial lease financing 17,098 19,880 87 32 25 20
456,650 494,583 2,152 1,449 269 153
U.S. small business commercial (1) 36,469 15,333 75 50 115 97
Commercial loans excluding loans accounted for under the fair
value option 493,119 509,916 2,227 1,499 384 250
Loans accounted for under the fair value option (2) 5,946 7,741
Total commercial loans and leases $ 499,065 $ 517,657
(1)
Includes card-related products.
(2)
Commercial loans accounted for under the fair value option include U.S. commercial of $2.9 billion and $4.7 billion and non-U.S. commercial of $3.0 billion and $3.1 billion at December 31,
2020 and 2019. For more information on the fair value option, see Note 21 – Fair Value Option to the Consolidated Financial Statements.
(3)
Table 32 presents net charge-offs and related ratios for our commercial loans and leases for 2020 and 2019.
Table 32 Commercial Net Charge-offs and Related Ratios

Net Charge-offs Net Charge-off Ratios (1)
U.S. commercial $ 718 $ 256 0.23% 0.08%
Non-U.S. commercial 155 84 0.15 0.08
Total commercial and industrial 873 340 0.21 0.08
Commercial real estate 270 29 0.43 0.05
Commercial lease financing 59 21 0.32 0.10
1,202 390 0.24 0.08
U.S. small business commercial 267 272 0.86 1.83
Total commercial $ 1,469 $ 662 0.28 0.13
(1)
Net charge-off ratios are calculated as net charge-offs divided by average outstanding loans and leases excluding loans accounted for under the fair value option.
Table 33 presents commercial reservable criticized utilized exposure by loan type. Criticized exposure corresponds to the Special
Mention, Substandard and Doubtful asset categories as defined by regulatory authorities. Total commercial reservable criticized
utilized exposure increased $27.2 billion during 2020, which was spread across several industries, including travel and
entertainment, as a result of weaker economic conditions arising from COVID-19. At December 31, 2020 and 2019, 79 percent and
90 percent of commercial reservable criticized utilized exposure was secured.
Table 33 Commercial Reservable Criticized Utilized Exposure (1, 2)

December 31
U.S. commercial $ 21,388 6.83 % $ 8,272 2.46%
Non-U.S. commercial 5,051 5.03 989 0.89
Total commercial and industrial 26,439 6.40 9,261 2.07
Commercial real estate 10,213 16.42 1,129 1.75
Commercial lease financing 714 4.18 329 1.66
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37,366 7.59 10,719 2.01

U.S. small business commercial 1,300 3.56 733 4.78
Total commercial reservable criticized utilized exposure (1) $ 38,666 7.31 $ 11,452 2.09
(1)
Total commercial reservable criticized utilized exposure includes loans and leases of $36.6 billion and $10.7 billion and commercial letters of credit of $2.1 billion and $715 million at
(2)
Percentages are calculated as commercial reservable criticized utilized exposure divided by total commercial reservable utilized exposure for each exposure category.

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Commercial and Industrial 2020 as paydowns exceeded new originations. Reservable

Commercial and industrial loans include U.S. commercial and criticized utilized exposure increased $9.1 billion to $10.2
non-U.S. commercial portfolios. billion from $1.1 billion, or 16.42 and 1.75 percent of the
commercial real estate portfolio at December 31, 2020 and
U.S. Commercial 2019, due to downgrades driven by the impact of COVID-19
At December 31, 2020, 65 percent of the U.S. commercial loan across industries, primarily hotels. Although we have observed
portfolio, excluding small business, was managed in Global property-level improvements in a number of the most impacted
Banking, 18 percent in Global Markets, 15 percent in GWIM sectors, the length of time for recovery has been slower than
(generally business-purpose loans for high net worth clients) and originally anticipated, which has prompted additional
the remainder primarily in Consumer Banking. U.S. commercial downgrades. The portfolio remains diversified across property
loans decreased $18.3 billion during 2020 driven by Global types and geographic regions. California represented the largest
Banking. Reservable criticized utilized exposure increased $13.1 state concentration at 23 percent and 24 percent of the
billion, which was spread across several industries, including commercial real estate portfolio at December 31, 2020 and
travel and entertainment, as a result of weaker economic 2019. The commercial real estate portfolio is predominantly
conditions arising from COVID-19. managed in Global Banking and consists of loans made
Non-U.S. Commercial primarily to public and private developers, and commercial real
At December 31, 2020, 79 percent of the non-U.S. commercial estate firms.
loan portfolio was managed in Global Banking and 21 percent in During 2020, we continued to see low default rates and
Global Markets. Non-U.S. commercial loans decreased $14.5 varying degrees of improvement in the portfolio. We use a
billion during 2020, primarily in Global Banking. For information number of proactive risk mitigation initiatives to reduce
on the non-U.S. commercial portfolio, see Non-U.S. Portfolio on adversely rated exposure in the commercial real estate portfolio,
page 97. including transfers of deteriorating exposures to management by
independent special asset officers and the pursuit of loan
Commercial Real Estate restructurings or asset sales to achieve the best results for our
Commercial real estate primarily includes commercial loans customers and the Corporation.
secured by non-owner-occupied real estate and is dependent on Table 34 presents outstanding commercial real estate loans
the sale or lease of the real estate as the primary source of by geographic region, based on the geographic location of the
repayment. Outstanding loans declined by $2.3 billion during collateral, and by property type.
Table 34 Outstanding Commercial Real Estate Loans

December 31
By Geographic Region
California $ 14,028 $ 14,910
Northeast 11,628 12,408
Southwest 8,551 8,408
Southeast 6,588 5,937
Florida 4,294 3,984
Midwest 3,483 3,203
Illinois 2,594 3,349
Midsouth 2,370 2,468
Northwest 1,634 1,638
Non-U.S. 3,187 3,724
Other (1) 2,007 2,660
Total outstanding commercial real estate loans $ 60,364 $ 62,689
By Property Type
Non-residential
Office $ 17,667 $ 17,902
Industrial / Warehouse 8,330 8,677
Shopping centers / Retail 7,931 8,183
Hotels / Motels 7,226 6,982
Multi-family rental 7,051 7,250
Unsecured 2,336 3,438
Multi-use 1,460 1,788
Other 7,146 6,958
Total non-residential 59,147 61,178
Residential 1,217 1,511
Total outstanding commercial real estate loans $ 60,364 $ 62,689
(1)
Includes unsecured loans to real estate investment trusts and national home builders whose portfolios of properties span multiple geographic regions and properties in the states of Colorado,
Utah, Hawaii, Wyoming and Montana.
U.S. Small Business Commercial 2020 and 2019. Of the U.S. small business commercial net
The U.S. small business commercial loan portfolio is comprised charge-offs, 91 percent and 94 percent were credit card-related
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of small business card loans and small business loans primarily products in 2020 and 2019.
managed in Consumer Banking, and includes $22.7 billion of Nonperforming Commercial Loans, Leases and Foreclosed
PPP loans outstanding at December 31, 2020. Excluding PPP,
Properties Activity
credit card-related products were 50 percent and 52 percent of
Table 35 presents the nonperforming commercial loans, leases
the U.S. small business commercial portfolio at December 31,
and foreclosed properties activity during 2020 and 2019.

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Nonperforming loans do not include loans accounted for under contractually current. Commercial nonperforming loans were
the fair value option. During 2020, nonperforming commercial carried at 81 percent of their unpaid principal balance before
loans and leases increased $728 million to $2.2 billion, consideration of the allowance for loan and lease losses, as the
primarily driven by the impact of COVID-19. At December 31, carrying value of these loans has been reduced to the estimated
2020, 84 percent of commercial nonperforming loans, leases collateral value less costs to sell.
and foreclosed properties were secured and 66 percent were
Table 35 Nonperforming Commercial Loans, Leases and Foreclosed Properties Activity (1, 2)
Nonperforming loans and leases, January 1 $ 1,499 $ 1,102
Additions 3,518 2,048
Reductions:
Paydowns (1,002) (648)
Sales (350) (215)
Returns to performing status (3) (172) (120)
Charge-offs (1,208) (478)
Transfers to foreclosed properties (2) (9)
Transfers to loans held-for-sale (56) (181)
Total net additions to nonperforming loans and leases 728 397
Total nonperforming loans and leases, December 31 2,227 1,499
Foreclosed properties, December 31 41 56
Nonperforming commercial loans, leases and foreclosed properties, December 31 2,268 1,555
Nonperforming commercial loans and leases as a percentage of outstanding commercial loans and leases (4) 0.45 % 0.29 %
Nonperforming commercial loans, leases and foreclosed properties as a percentage of outstanding commercial loans, leases
and foreclosed properties (4) 0.46 0.30
(1)
Balances do not include nonperforming loans held-for-sale of $359 million and $239 million at December 31, 2020 and 2019.
(2)
Includes U.S. small business commercial activity. Small business card loans are excluded as they are not classified as nonperforming.
(3)
Commercial loans and leases may be returned to performing status when all principal and interest is current and full repayment of the remaining contractual principal and interest is expected, or
when the loan otherwise becomes well-secured and is in the process of collection. TDRs are generally classified as performing after a sustained period of demonstrated payment performance.
(4)
Outstanding commercial loans exclude loans accounted for under the fair value option.
Table 36 presents our commercial TDRs by product type and Outstanding Loans and Leases and Allowance for Credit Losses
performing status. U.S. small business commercial TDRs are to the Consolidated Financial Statements. For more information
comprised of renegotiated small business card loans and small on our loan modification programs offered in response to the
business loans. The renegotiated small business card loans are pandemic, most of which are not TDRs, see Executive Summary
not classified as nonperforming as they are charged off no later – Recent Developments – COVID-19 Pandemic on page 48 and
than the end of the month in which the loan becomes 180 days Note 1 – Summary of Significant Accounting Principles to the
past due. For more information on TDRs, see Note 5 – Consolidated Financial Statements.
Table 36 Commercial Troubled Debt Restructurings

(Dollars in millions) Nonperforming Performing Total Nonperforming Performing Total
U.S. commercial $ 509 $ 850 $ 1,359 $ 617 $ 999 $ 1,616
Non-U.S. commercial 49 119 168 41 193 234
Total commercial and industrial 558 969 1,527 658 1,192 1,850
Commercial real estate 137 — 137 212 14 226
Commercial lease financing 42 2 44 18 31 49
737 971 1,708 888 1,237 2,125
U.S. small business commercial — 29 29 — 27 27
Total commercial troubled debt restructurings $ 737 $ 1,000 $ 1,737 $ 888 $ 1,264 $ 2,152
Industry Concentrations determined on an industry-by-industry basis. A risk management

Table 37 presents commercial committed and utilized credit framework is in place to set and approve industry limits as well
exposure by industry and the total net credit default protection as to provide ongoing monitoring. The MRC oversees industry
purchased to cover the funded and unfunded portions of certain limit governance.
credit exposures. Our commercial credit exposure is diversified Asset managers and funds, our largest industry concentration
across a broad range of industries. Total commercial committed with committed exposure of $101.5 billion, decreased $8.5
exposure decreased $22.1 billion, or two percent, during 2020 billion, or eight percent, during 2020.
to $1.0 trillion. The decrease in commercial committed Real estate, our second largest industry concentration with
exposure was concentrated in the Global commercial banks, committed exposure of $92.4 billion, decreased $4.0 billion, or
Asset managers and funds, Utilities, and Real estate industry four percent, during 2020. For more information on the
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sectors. Decreases were partially offset by increased exposure commercial real estate and related portfolios, see Commercial
to the Finance companies and Automobiles and components Portfolio Credit Risk Management – Commercial Real Estate on
industry sectors. page 94.
Industry limits are used internally to manage industry Capital goods, our third largest industry concentration with
concentrations and are based on committed exposure that is committed exposure of $81.0 billion, remained flat during
2020.
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Given the widespread impact of the pandemic on the U.S. related committed exposure decreased $3.3 billion, or nine
and global economy, a number of industries have been and will percent, during 2020 to $33.0 billion, driven by declines in
likely continue to be adversely impacted. We continue to monitor exploration and production, refining and marketing exposure,
all industries, particularly higher risk industries which are energy equipment and services, partially offset by an increase
experiencing or could experience a more significant impact to in our integrated client exposure. For more information on
their financial condition. The impact of the pandemic has also COVID-19, see Executive Summary – Recent Developments –
placed significant stress on global demand for oil. Our energy- COVID-19 Pandemic on page 48.
Table 37 Commercial Credit Exposure by Industry (1)

Commercial Total Commercial
Utilized Committed (2)
December 31
Asset managers and funds $ 68,093 $ 71,386 $ 101,540 $ 110,069
Real estate (3) 69,267 70,361 92,414 96,370
Capital goods 39,911 41,082 80,959 80,892
Finance companies 46,948 40,173 70,004 63,942
Healthcare equipment and services 33,759 34,353 57,880 55,918
Government and public education 41,669 41,889 56,212 53,566
Materials 24,548 26,663 50,792 52,129
Retailing 24,749 25,868 49,710 48,317
Consumer services 32,000 28,434 48,026 49,071
Food, beverage and tobacco 22,871 24,163 44,628 45,956
Commercial services and supplies 21,154 23,103 38,149 38,944
Transportation 23,426 23,449 33,444 33,028
Energy 13,936 16,406 32,983 36,326
Utilities 12,387 12,383 29,234 36,060
Individuals and trusts 18,784 18,927 25,881 27,817
Technology hardware and equipment 10,515 10,646 24,796 24,072
Media 13,144 12,445 24,677 23,645
Software and services 11,709 10,432 23,647 20,556
Global commercial banks 20,751 30,171 22,922 32,345
Automobiles and components 10,956 7,345 20,765 14,910
Consumer durables and apparel 9,232 10,193 20,223 21,245
Vehicle dealers 15,028 18,013 18,696 21,435
Pharmaceuticals and biotechnology 5,217 5,964 16,349 20,206
Telecommunication services 9,411 9,154 15,605 16,113
Insurance 5,921 6,673 13,491 15,218
Food and staples retailing 5,209 6,290 11,810 10,392
Financial markets infrastructure (clearinghouses) 4,939 5,496 8,648 7,997
Religious and social organizations 4,769 3,844 6,759 5,756
Total commercial credit exposure by industry $ 620,303 $ 635,306 $ 1,040,244 $ 1,062,295
Net credit default protection purchased on total commitments (4) $ (4,170) $ (3,349)
(1)
Includes U.S. small business commercial exposure.
(2)
Includes the notional amount of unfunded legally binding lending commitments net of amounts distributed (i.e., syndicated or participated) to other financial institutions. The distributed amounts
were $10.5 billion and $10.6 billion at December 31, 2020 and 2019.
(3)
Industries are viewed from a variety of perspectives to best isolate the perceived risks. For purposes of this table, the real estate industry is defined based on the primary business activity of the
borrowers or counterparties using operating cash flows and primary source of repayment as key factors.
(4)
Represents net notional credit protection purchased to hedge funded and unfunded exposures for which we elected the fair value option, as well as certain other credit exposures. For more
information, see Commercial Portfolio Credit Risk Management – Risk Mitigation.
Risk Mitigation our funded and unfunded exposures for which we elected the
We purchase credit protection to cover the funded portion as fair value option, as well as certain other credit exposures, was
well as the unfunded portion of certain credit exposures. To $4.2 billion and $3.3 billion. We recorded net losses of $240
lower the cost of obtaining our desired credit protection levels, million in 2020 compared to net losses of $145 million in 2019
we may add credit exposure within an industry, borrower or for these same positions. The gains and losses on these
counterparty group by selling protection. instruments were offset by gains and losses on the related
At December 31, 2020 and 2019, net notional credit default exposures. The Value-at-Risk (VaR) results for these exposures
protection purchased in our credit derivatives portfolio to hedge are included in the fair value option portfolio information in
Table 44. For more information, see Trading Risk Management
on page 102.
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Tables 38 and 39 present the maturity profiles and the purchased credit default protection. In most cases, credit
credit exposure debt ratings of the net credit default protection derivative transactions are executed on a daily margin basis.
portfolio at December 31, 2020 and 2019. Therefore, events such as a credit downgrade, depending on the
ultimate rating level, or a breach of credit covenants would
typically require an increase in the amount of collateral required
Table 38 Net Credit Default Protection by Maturity
by the counterparty, where applicable, and/or allow us to take
December 31 additional protective measures such as early termination of all
2020 2019 trades. For more information on credit derivatives and
Less than or equal to one year 65 % 54 % counterparty credit risk valuation adjustments, see Note 3 –
Greater than one year and less than or equal Derivatives to the Consolidated Financial Statements.
to five years 34 45
Greater than five years 1 1 Non-U.S. Portfolio
Total net credit default protection 100 % 100 %
Our non-U.S. credit and trading portfolios are subject to country
risk. We define country risk as the risk of loss from unfavorable
economic and political conditions, currency fluctuations, social
Table 39 Net Credit Default Protection by Credit instability and changes in government policies. A risk
Exposure Debt Rating management framework is in place to measure, monitor and
manage non-U.S. risk and exposures. In addition to the direct
Net Percent of Net Percent of
Notional (1) Total Notional (1) Total
risk of doing business in a country, we also are exposed to
December 31 indirect country risks (e.g., related to the collateral received on
(Dollars in millions) 2020 2019 secured financing transactions or related to client clearing
Ratings (2, 3) activities). These indirect exposures are managed in the normal
A $ (250) 6.0 % $ (697) 20.8 % course of business through credit, market and operational risk
BBB (1,856) 44.5 (1,089) 32.5 governance, rather than through country risk governance.
BB (1,363) 32.7 (766) 22.9 Table 40 presents our 20 largest non-U.S. country exposures
B (465) 11.2 (373) 11.1 at December 31, 2020. These exposures accounted for 90
CCC and below (182) 4.4 (119) 3.6
percent and 88 percent of our total non-U.S. exposure at
NR (4) (54) 1.2 (305) 9.1
December 31, 2020 and 2019. Net country exposure for these
Total net credit
default protection $ (4,170) 100.0 % $ (3,349) 100.0 % 20 countries increased $21.2 billion in 2020. The majority of
(1)
Represents net credit default protection purchased.
the increase was due to higher deposits with central banks in
(2)
Ratings are refreshed on a quarterly basis. Germany and Japan.
(3)
Ratings of BBB- or higher are considered to meet the definition of investment grade.
(4)
NR is comprised of index positions held and any names that have not been rated.
Non-U.S. exposure is presented on an internal risk
management basis and includes sovereign and non-sovereign
In addition to our net notional credit default protection credit exposure, securities and other investments issued by or
purchased to cover the funded and unfunded portion of certain domiciled in countries other than the U.S.
credit exposures, credit derivatives are used for market-making Funded loans and loan equivalents include loans, leases,
activities for clients and establishing positions intended to profit and other extensions of credit and funds, including letters of
from directional or relative value changes. We execute the credit and due from placements. Unfunded commitments are
majority of our credit derivative trades in the OTC market with the undrawn portion of legally binding commitments related to
large, multinational financial institutions, including broker- loans and loan equivalents. Net counterparty exposure includes
dealers and, to a lesser degree, with a variety of other the fair value of derivatives, including the counterparty risk
investors. Because these transactions are executed in the OTC associated with credit default swaps (CDS), and secured
market, we are subject to settlement risk. We are also subject financing transactions. Securities and other investments are
to credit risk in the event that these counterparties fail to carried at fair value and long securities exposures are netted
perform under the terms of these contracts. In order to properly against short exposures with the same underlying issuer to, but
reflect counterparty credit risk, we record counterparty credit risk not below, zero. Net country exposure represents country
valuation adjustments on certain derivative assets, including our exposure less hedges and credit default protection purchased,
net of credit default protection sold.
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Table 40 Top 20 Non-U.S. Countries Exposure

Increase
Country Net Country (Decrease)
Funded Loans Unfunded Net Securities/ Exposure at Hedges and Exposure at from
and Loan Loan Counterparty Other December 31 Credit Default December 31 December 31
(Dollars in millions) Equivalents Commitments Exposure Investments 2020 Protection 2020 2019
United Kingdom $ 31,817 $ 18,201 $ 6,601 $ 4,086 $ 60,705 $ (1,233) $ 59,472 $ 3,628
Germany 29,169 10,772 2,155 4,492 46,588 (1,685) 44,903 14,075
Canada 8,657 8,681 1,624 2,628 21,590 (456) 21,134 1,012
France 8,219 8,353 988 4,329 21,889 (1,098) 20,791 4,536
Japan 12,679 1,086 1,115 3,325 18,205 (709) 17,496 6,964
China 10,098 67 1,529 1,952 13,646 (226) 13,420 (2,167)
Australia 6,559 4,242 372 2,235 13,408 (321) 13,087 1,985
Brazil 5,854 696 708 3,288 10,546 (253) 10,293 (1,479)
Netherlands 4,654 4,109 486 997 10,246 (562) 9,684 (643)
Singapore 4,115 278 359 4,603 9,355 (73) 9,282 1,456
South Korea 5,161 856 488 2,214 8,719 (168) 8,551 (154)
India 5,428 221 353 1,989 7,991 (180) 7,811 (4,206)
Switzerland 3,811 2,817 412 130 7,170 (275) 6,895 (490)
Hong Kong 4,434 452 584 1,128 6,598 (61) 6,537 (519)
Mexico 3,712 1,379 205 1,112 6,408 (121) 6,287 (1,524)
Italy 2,456 1,784 553 1,568 6,361 (669) 5,692 315
Belgium 2,471 1,334 505 797 5,107 (140) 4,967 (1,540)
Spain 2,835 1,156 262 914 5,167 (351) 4,816 94
Ireland 2,785 1,050 100 253 4,188 (23) 4,165 798
United Arab Emirates 2,218 136 266 77 2,697 (10) 2,687 (900)
Total top 20 non-U.S.
countries exposure $ 157,132 $ 67,670 $ 19,665 $ 42,117 $ 286,584 $ (8,614) $ 277,970 $ 21,241
Our largest non-U.S. country exposure at December 31, 2020 The impact of COVID-19 could have an adverse impact on the
was the U.K. with net exposure of $59.5 billion, which global economy for a prolonged period of time. For more
represents a $3.6 billion increase from December 31, 2019. information on how the pandemic may affect our operations,
Our second largest non-U.S. country exposure was Germany with see Executive Summary – Recent Developments – COVID-19
net exposure of $44.9 billion at December 31, 2020, a $14.1 Pandemic on page 48 and Item 1A. Risk Factors of our 2020
billion increase from December 31, 2019. The increase in Annual Report on Form 10-K.
Germany was primarily driven by an increase in deposits with Table 41 presents countries that had total cross-border
the central bank. exposure, including the notional amount of cash loaned under
In light of the global pandemic, we are monitoring our non- secured financing agreements, exceeding one percent of our
U.S. exposure closely, particularly in countries where restrictions total assets at December 31, 2020. Local exposure, defined as
on certain activities, in an attempt to contain the spread and exposure booked in local offices of a respective country with
impact of the virus, have affected and will likely continue to clients in the same country, is excluded. At December 31,
adversely affect economic activity. We are managing the impact 2020, the U.K. and France were the only countries where their
to our international business operations as part of our overall respective total cross-border exposures exceeded one percent
response framework and are taking actions to manage exposure of our total assets. No other countries had total cross-border
carefully in impacted regions while supporting the needs of our exposure that exceeded 0.75 percent of our total assets at
clients. The magnitude and duration of the pandemic and its full December 31, 2020.
impact on the global economy continue to be highly uncertain.
Table 41 Total Cross-border Exposure Exceeding One Percent of Total Assets

Exposure as a
Cross-border Percent of
(Dollars in millions) December 31 Public Sector Banks Private Sector Exposure Total Assets
United Kingdom 2020 $ 4,733 $ 2,269 $ 95,180 $ 102,182 3.62 %
2019 1,859 3,580 93,232 98,671 4.05
2018 1,505 3,458 46,191 51,154 2.17
France 2020 3,073 1,726 26,399 31,198 1.11
2019 736 2,473 23,172 26,381 1.08
2018 633 2,385 29,847 32,865 1.40
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99
Allowance for Credit Losses The allowance for credit losses further increased by $7.2
On January 1, 2020, the Corporation adopted the new billion from January 1, 2020 to $20.7 billion at December 31,
accounting standard that requires the measurement of the 2020, which included a $5.0 billion reserve increase related to
allowance for credit losses to be based on management’s best the commercial portfolio and a $2.2 billion reserve increase
estimate of lifetime ECL inherent in the Corporation’s relevant related to the consumer portfolio. The increases were driven by
financial assets. Upon adoption of the new accounting standard, deterioration in the economic outlook resulting from the impact
the Corporation recorded a net increase of $3.3 billion in the of COVID-19.
allowance for credit losses which was comprised of a net The following table presents an allocation of the allowance
increase of $2.9 billion in the allowance for loan and lease for credit losses by product type for December 31, 2020,
losses and an increase of $310 million in the reserve for January 1, 2020 and December 31, 2019 (prior to the adoption
unfunded lending commitments. The net increase was primarily of the CECL accounting standard).
driven by a $3.1 billion increase related to the credit card
portfolio.
Table 42 Allocation of the Allowance for Credit Losses by Product Type
Percent of Percent of Percent of

Loans and Loans and Loans and
Percent of Leases Percent of Leases Percent of Leases
Amount Total Outstanding (1) Amount Total Outstanding (1) Amount Total Outstanding (1)
(Dollars in millions) December 31, 2020 January 1, 2020 December 31, 2019
Allowance for loan and lease losses
Residential mortgage $ 459 2.44 % 0.21 % $ 212 1.72 % 0.09 % $ 325 3.45 % 0.14 %
Home equity 399 2.12 1.16 228 1.84 0.57 221 2.35 0.55
Credit card 8,420 44.79 10.70 6,809 55.10 6.98 3,710 39.39 3.80
Direct/Indirect consumer 752 4.00 0.82 566 4.58 0.62 234 2.49 0.26
Other consumer 41 0.22 n/m 55 0.45 n/m 52 0.55 n/m
Total consumer 10,071 53.57 2.35 7,870 63.69 1.69 4,542 48.23 0.98
U.S. commercial (2) 5,043 26.82 1.55 2,723 22.03 0.84 3,015 32.02 0.94
Non-U.S. commercial 1,241 6.60 1.37 668 5.41 0.64 658 6.99 0.63
Commercial real estate 2,285 12.15 3.79 1,036 8.38 1.65 1,042 11.07 1.66
Commercial lease financing 162 0.86 0.95 61 0.49 0.31 159 1.69 0.80
Total commercial 8,731 46.43 1.77 4,488 36.31 0.88 4,874 51.77 0.96
Allowance for loan and lease losses 18,802 100.00 % 2.04 12,358 100.00 % 1.27 9,416 100.00 % 0.97
Reserve for unfunded lending commitments 1,878 1,123 813
Allowance for credit losses $ 20,680 $ 13,481 $ 10,229
(1)
Ratios are calculated as allowance for loan and lease losses as a percentage of loans and leases outstanding excluding loans accounted for under the fair value option. Consumer loans
accounted for under the fair value option include residential mortgage loans of $298 million at December 31, 2020 and $257 million at January 1, 2020 and December 31, 2019 and home
equity loans of $437 million at December 31, 2020 and $337 million at January 1, 2020 and December 31, 2019. Commercial loans accounted for under the fair value option include U.S.
commercial loans of $2.9 billion, $5.1 billion and $4.7 billion at December 31, 2020, January 1, 2020 and December 31, 2019, and non-U.S. commercial loans of $3.0 billion, $3.2 billion and
$3.1 billion at December 31, 2020, January 1, 2020 and December 31, 2019.
(2)
Includes allowance for loan and lease losses for U.S. small business commercial loans of $1.5 billion, $831 million and $523 million at December 31, 2020, January 1, 2020 and December 31,
2019.
Net charge-offs for 2020 were $4.1 billion compared to $3.6 lending commitments, increased $5.7 billion to $6.5 billion
billion in 2019 driven by increases in commercial losses. The during 2020 compared to 2019.
provision for credit losses increased $7.7 billion to $11.3 billion The following table presents a rollforward of the allowance
during 2020 compared to 2019. The allowance for credit losses for credit losses, including certain loan and allowance ratios for
included a reserve build of $7.2 billion for 2020, excluding the 2020, noting that measurement of the allowance for credit
impact of the new accounting standard, primarily due to the losses for 2019 was based on management’s estimate of
deterioration in the economic outlook resulting from the impact probable incurred losses. For more information on the
of COVID-19 on both the consumer and commercial portfolios. Corporation’s credit loss accounting policies and activity related
The provision for credit losses for the consumer portfolio, to the allowance for credit losses, see Note 1 – Summary of
including unfunded lending commitments, increased $2.0 billion Significant Accounting Principles and Note 5 – Outstanding Loans
to $4.9 billion during 2020 compared to 2019. The provision for and Leases and Allowance for Credit Losses to the Consolidated
credit losses for the commercial portfolio, including unfunded Financial Statements.
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Table 43 Allowance for Credit Losses

Allowance for loan and lease losses, January 1 $ 12,358 $ 9,601
Loans and leases charged off
Residential mortgage (40) (93)
Home equity (58) (429)
Credit card (2,967) (3,535)
Direct/Indirect consumer (372) (518)
Other consumer (307) (249)
Total consumer charge-offs (3,744) (4,824)
U.S. commercial (1) (1,163) (650)
Non-U.S. commercial (168) (115)
Commercial real estate (275) (31)
Commercial lease financing (69) (26)
Total commercial charge-offs (1,675) (822)
Total loans and leases charged off (5,419) (5,646)
Recoveries of loans and leases previously charged off
Residential mortgage 70 140
Home equity 131 787
Credit card 618 587
Direct/Indirect consumer 250 309
Other consumer 23 15
Total consumer recoveries 1,092 1,838
U.S. commercial (2) 178 122
Non-U.S. commercial 13 31
Commercial real estate 5 2
Commercial lease financing 10 5
Total commercial recoveries 206 160
Total recoveries of loans and leases previously charged off 1,298 1,998
Net charge-offs (4,121) (3,648)
Provision for loan and lease losses 10,565 3,574
Other — (111)
Allowance for loan and lease losses, December 31 18,802 9,416
Reserve for unfunded lending commitments, January 1 1,123 797
Provision for unfunded lending commitments 755 16
Reserve for unfunded lending commitments, December 31 1,878 813
Allowance for credit losses, December 31 $ 20,680 $ 10,229
Loan and allowance ratios:

Loans and leases outstanding at December 31 (3) $ 921,180 $ 975,091
Allowance for loan and lease losses as a percentage of total loans and leases outstanding at December 31 (3) 2.04 % 0.97 %
Consumer allowance for loan and lease losses as a percentage of total consumer loans and leases outstanding at December
31 (4) 2.35 0.98
Commercial allowance for loan and lease losses as a percentage of total commercial loans and leases outstanding at
December 31 (5) 1.77 0.96
Average loans and leases outstanding (3) $ 974,281 $ 951,583
Annualized net charge-offs as a percentage of average loans and leases outstanding (3) 0.42 % 0.38 %
Allowance for loan and lease losses as a percentage of total nonperforming loans and leases at December 31 380 265
Ratio of the allowance for loan and lease losses at December 31 to net charge-offs 4.56 2.58
Amounts included in allowance for loan and lease losses for loans and leases that are excluded from nonperforming loans and
leases at December 31 (6) $ 9,854 $ 4,151
Allowance for loan and lease losses as a percentage of total nonperforming loans and leases, excluding the allowance for loan
and lease losses for loans and leases that are excluded from nonperforming loans and leases at December 31 (6) 181 % 148 %
(1)
Includes U.S. small business commercial charge-offs of $321 million in 2020 compared to $320 million in 2019.
(2)
Includes U.S. small business commercial recoveries of $54 million in 2020 compared to $48 million in 2019.
(3)
Outstanding loan and lease balances and ratios do not include loans accounted for under the fair value option of $6.7 billion and $8.3 billion at December 31, 2020 and 2019. Average loans
accounted for under the fair value option were $8.2 billion in 2020 compared to $6.8 billion in 2019.
(4)
Excludes consumer loans accounted for under the fair value option of $735 million and $594 million at December 31, 2020 and 2019.
(5)
Excludes commercial loans accounted for under the fair value option of $5.9 billion and $7.7 billion at December 31, 2020 and 2019.
(6)
Primarily includes amounts related to credit card and unsecured consumer lending portfolios in Consumer Banking.
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02.25.2021 22:54PM 62539
Market Risk Management Interest Rate Risk

Market risk is the risk that changes in market conditions may Interest rate risk represents exposures to instruments whose
adversely impact the value of assets or liabilities, or otherwise values vary with the level or volatility of interest rates. These
negatively impact earnings. This risk is inherent in the financial instruments include, but are not limited to, loans, debt
instruments associated with our operations, primarily within our securities, certain trading-related assets and liabilities,
Global Markets segment. We are also exposed to these risks in deposits, borrowings and derivatives. Hedging instruments used
other areas of the Corporation (e.g., our ALM activities). In the to mitigate these risks include derivatives such as options,
event of market stress, these risks could have a material futures, forwards and swaps.
impact on our results. For more information, see Interest Rate
Risk Management for the Banking Book on page 105. Foreign Exchange Risk
We have been affected, and expect to continue to be Foreign exchange risk represents exposures to changes in the
affected, by market stress resulting from the pandemic that values of current holdings and future cash flows denominated in
began in the first quarter of 2020. For more information on the currencies other than the U.S. dollar. The types of instruments
effects of the pandemic, see Executive Summary – Recent exposed to this risk include investments in non-U.S.
Developments – COVID-19 Pandemic on page 48. subsidiaries, foreign currency-denominated loans and securities,
Our traditional banking loan and deposit products are non- future cash flows in foreign currencies arising from foreign
trading positions and are generally reported at amortized cost exchange transactions, foreign currency-denominated debt and
for assets or the amount owed for liabilities (historical cost). various foreign exchange derivatives whose values fluctuate with
However, these positions are still subject to changes in changes in the level or volatility of currency exchange rates or
economic value based on varying market conditions, with one of non-U.S. interest rates. Hedging instruments used to mitigate
the primary risks being changes in the levels of interest rates. this risk include foreign exchange options, currency swaps,
The risk of adverse changes in the economic value of our non- futures, forwards, and foreign currency-denominated debt and
trading positions arising from changes in interest rates is deposits.
managed through our ALM activities. We have elected to
account for certain assets and liabilities under the fair value
Mortgage Risk
option. Mortgage risk represents exposures to changes in the values of
Our trading positions are reported at fair value with changes mortgage-related instruments. The values of these instruments
reflected in income. Trading positions are subject to various are sensitive to prepayment rates, mortgage rates, agency debt
changes in market-based risk factors. The majority of this risk is ratings, default, market liquidity, government participation and
generated by our activities in the interest rate, foreign exchange, interest rate volatility. Our exposure to these instruments takes
credit, equity and commodities markets. In addition, the values several forms. For example, we trade and engage in market-
of assets and liabilities could change due to market liquidity, making activities in a variety of mortgage securities including
correlations across markets and expectations of market whole loans, pass-through certificates, commercial mortgages
volatility. We seek to manage these risk exposures by using a and collateralized mortgage obligations including collateralized
variety of techniques that encompass a broad range of financial debt obligations using mortgages as underlying collateral. In
instruments. The key risk management techniques are addition, we originate a variety of MBS, which involves the
discussed in more detail in the Trading Risk Management accumulation of mortgage-related loans in anticipation of
section. eventual securitization, and we may hold positions in mortgage
Global Risk Management is responsible for providing senior securities and residential mortgage loans as part of the ALM
management with a clear and comprehensive understanding of portfolio. We also record MSRs as part of our mortgage
the trading risks to which we are exposed. These origination activities. Hedging instruments used to mitigate this
responsibilities include ownership of market risk policy, risk include derivatives such as options, swaps, futures and
developing and maintaining quantitative risk models, calculating forwards as well as securities including MBS and U.S. Treasury
aggregated risk measures, establishing and monitoring position securities. For more information, see Mortgage Banking Risk
limits consistent with risk appetite, conducting daily reviews and Management on page 107.
analysis of trading inventory, approving material risk exposures Equity Market Risk
and fulfilling regulatory requirements. Market risks that impact
Equity market risk represents exposures to securities that
businesses outside of Global Markets are monitored and
represent an ownership interest in a corporation in the form of
governed by their respective governance functions.
domestic and foreign common stock or other equity-linked
Model risk is the potential for adverse consequences from
instruments. Instruments that would lead to this exposure
decisions based on incorrect or misused model outputs and
reports. Given that models are used across the Corporation, include, but are not limited to, the following: common stock,
model risk impacts all risk types including credit, market and exchange-traded funds, American Depositary Receipts,
operational risks. The Enterprise Model Risk Policy defines convertible bonds, listed equity options (puts and calls), OTC
model risk standards, consistent with our risk framework and equity options, equity total return swaps, equity index futures
risk appetite, prevailing regulatory guidance and industry best and other equity derivative products. Hedging instruments used
practice. All models, including risk management, valuation and to mitigate this risk include options, futures, swaps, convertible
regulatory capital models, must meet certain validation criteria, bonds and cash positions.
including effective challenge of the conceptual soundness of the
model, independent model testing and ongoing monitoring Commodity Risk
through outcomes analysis and benchmarking. The Enterprise Commodity risk represents exposures to instruments traded in
Model Risk Committee (EMRC), a subcommittee of the MRC, the petroleum, natural gas, power and metals markets. These
oversees that model standards are consistent with model risk instruments consist primarily of futures, forwards, swaps and
requirements and monitors the effective challenge in the model options. Hedging instruments used to mitigate this risk include
validation process across the Corporation.


02.26.2021 18:55PM 62539
options, futures and swaps in the same or similar commodity are not consistently available. For positions with insufficient
product, as well as cash positions. historical data for the VaR calculation, the process for
establishing an appropriate proxy is based on fundamental and
Issuer Credit Risk statistical analysis of the new product or less liquid position.
Issuer credit risk represents exposures to changes in the This analysis identifies reasonable alternatives that replicate
creditworthiness of individual issuers or groups of issuers. Our both the expected volatility and correlation to other market risk
portfolio is exposed to issuer credit risk where the value of an factors that the missing data would be expected to experience.
asset may be adversely impacted by changes in the levels of VaR may not be indicative of realized revenue volatility as
credit spreads, by credit migration or by defaults. Hedging changes in market conditions or in the composition of the
instruments used to mitigate this risk include bonds, CDS and portfolio can have a material impact on the results. In particular,
other credit fixed-income instruments. the historical data used for the VaR calculation might indicate
higher or lower levels of portfolio diversification than will be
Market Liquidity Risk experienced. In order for the VaR model to reflect current market
Market liquidity risk represents the risk that the level of conditions, we update the historical data underlying our VaR
expected market activity changes dramatically and, in certain model on a weekly basis, or more frequently during periods of
cases, may even cease. This exposes us to the risk that we will market stress, and regularly review the assumptions underlying
not be able to transact business and execute trades in an the model. A minor portion of risks related to our trading
orderly manner which may impact our results. This impact could positions is not included in VaR. These risks are reviewed as
be further exacerbated if expected hedging or pricing part of our ICAAP. For more information regarding ICAAP, see
correlations are compromised by disproportionate demand or Capital Management on page 73.
lack of demand for certain instruments. We utilize various risk Global Risk Management continually reviews, evaluates and
mitigating techniques as discussed in more detail in Trading enhances our VaR model so that it reflects the material risks in
Risk Management. our trading portfolio. Changes to the VaR model are reviewed
and approved prior to implementation and any material changes
Trading Risk Management are reported to management through the appropriate
To evaluate risks in our trading activities, we focus on the actual management committees.
and potential volatility of revenues generated by individual Trading limits on quantitative risk measures, including VaR,
positions as well as portfolios of positions. Various techniques are independently set by Global Markets Risk Management and
and procedures are utilized to enable the most complete reviewed on a regular basis so that trading limits remain
understanding of these risks. Quantitative measures of market relevant and within our overall risk appetite for market risks.
risk are evaluated on a daily basis from a single position to the Trading limits are reviewed in the context of market liquidity,
portfolio of the Corporation. These measures include volatility and strategic business priorities. Trading limits are set
sensitivities of positions to various market risk factors, such as at both a granular level to allow for extensive coverage of risks
the potential impact on revenue from a one basis point change as well as at aggregated portfolios to account for correlations
in interest rates, and statistical measures utilizing both actual among risk factors. All trading limits are approved at least
and hypothetical market moves, such as VaR and stress annually. Approved trading limits are stored and tracked in a
testing. Periods of extreme market stress influence the centralized limits management system. Trading limit excesses
reliability of these techniques to varying degrees. Qualitative are communicated to management for review. Certain
evaluations of market risk utilize the suite of quantitative risk quantitative market risk measures and corresponding limits
measures while understanding each of their respective have been identified as critical in the Corporation’s Risk
limitations. Additionally, risk managers independently evaluate Appetite Statement. These risk appetite limits are reported on a
the risk of the portfolios under the current market environment daily basis and are approved at least annually by the ERC and
and potential future environments. the Board.
VaR is a common statistic used to measure market risk as it In periods of market stress, Global Markets senior leadership
allows the aggregation of market risk factors, including the communicates daily to discuss losses, key risk positions and
effects of portfolio diversification. A VaR model simulates the any limit excesses. As a result of this process, the businesses
value of a portfolio under a range of scenarios in order to may selectively reduce risk.
generate a distribution of potential gains and losses. VaR Table 44 presents the total market-based portfolio VaR which
represents the loss a portfolio is not expected to exceed more is the combination of the total covered positions (and less liquid
than a certain number of times per period, based on a specified trading positions) portfolio and the fair value option portfolio.
holding period, confidence level and window of historical data. Covered positions are defined by regulatory standards as trading
We use one VaR model consistently across the trading assets and liabilities, both on- and off-balance sheet, that meet
portfolios and it uses a historical simulation approach based on a defined set of specifications. These specifications identify the
a three-year window of historical data. Our primary VaR statistic most liquid trading positions which are intended to be held for a
is equivalent to a 99 percent confidence level, which means short-term horizon and where we are able to hedge the material
that for a VaR with a one-day holding period, there should not be risk elements in a two-way market. Positions in less liquid
losses in excess of VaR, on average, 99 out of 100 trading markets, or where there are restrictions on the ability to trade
days. the positions, typically do not qualify as covered positions.
Within any VaR model, there are significant and numerous Foreign exchange and commodity positions are always
assumptions that will differ from company to company. The considered covered positions, except for structural foreign
accuracy of a VaR model depends on the availability and quality currency positions that are excluded with prior regulatory
of historical data for each of the risk factors in the portfolio. A approval. In addition, Table 44 presents our fair value option
VaR model may require additional modeling assumptions for portfolio, which includes substantially all of the funded and
new products that do not have the necessary historical market unfunded exposures for which we elect the fair value option, and
data or for less liquid positions for which accurate daily prices their corresponding hedges. Additionally, market risk VaR for

02.25.2021 22:54PM 62539
trading activities as presented in Table 44 differs from VaR level. The amounts disclosed in Table 44 and Table 45 align to
used for regulatory capital calculations due to the holding period the view of covered positions used in the Basel 3 capital
being used. The holding period for VaR used for regulatory calculations. Foreign exchange and commodity positions are
capital calculations is 10 days, while for the market risk VaR always considered covered positions, regardless of trading or
presented below, it is one day. Both measures utilize the same banking treatment for the trade, except for structural foreign
process and methodology. currency positions that are excluded with prior regulatory
The total market-based portfolio VaR results in Table 44 approval.
include market risk to which we are exposed from all business The annual average of total covered positions and less liquid
segments, excluding credit valuation adjustment (CVA), DVA and trading positions portfolio VaR increased for 2020 compared to
related hedges. The majority of this portfolio is within the Global 2019 primarily due to the impact of market volatility related to
Markets segment. the pandemic in the VaR look back period.
Table 44 presents year-end, average, high and low daily
trading VaR for 2020 and 2019 using a 99 percent confidence
Table 44 Market Risk VaR for Trading Activities

2020 2019
Year Year
(Dollars in millions) End Average High (1) Low (1) End Average High (1) Low (1)
Foreign exchange $ 8 $ 7 $ 25 $ 2 $ 4 $ 6 $ 13 $ 2
Interest rate 30 19 39 7 25 24 49 14
Credit 79 58 91 25 26 23 32 16
Equity 20 24 162 12 29 22 33 14
Commodities 4 6 12 3 4 6 31 4
Portfolio diversification (72) (61) — — (47) (49) — —
Total covered positions portfolio 69 53 171 27 41 32 47 24
Impact from less liquid exposures 52 27 — — — 3 — —
Total covered positions and less liquid trading positions portfolio 121 80 169 30 41 35 53 27
Fair value option loans 52 52 84 7 8 10 13 7
Fair value option hedges 11 13 17 9 10 10 17 4
Fair value option portfolio diversification (17) (24) — — (9) (10) — —
Total fair value option portfolio 46 41 86 9 9 10 16 5
Portfolio diversification (4) (15) — — (5) (7) — —
Total market-based portfolio $ 163 $ 106 171 32 $ 45 $ 38 56 28
(1)
The high and low for each portfolio may have occurred on different trading days than the high and low for the components. Therefore the impact from less liquid exposures and the amount of
portfolio diversification, which is the difference between the total portfolio and the sum of the individual components, is not relevant.
The graph below presents the daily covered positions and less liquid trading positions portfolio VaR for 2020, corresponding to
the data in Table 44. Peak VaR in mid-March 2020 was driven by increased market realized volatility and higher implied volatilities.
Additional VaR statistics produced within our single VaR presents average trading VaR statistics at 99 percent and 95
model are provided in Table 45 at the same level of detail as in percent confidence levels for 2020 and 2019. The increase in
Table 44. Evaluating VaR with additional statistics allows for an VaR for the 99 percent confidence level for 2020 was primarily
increased understanding of the risks in the portfolio as the due to COVID-19 related market volatility, which impacted the
historical market data used in the VaR calculation does not 99 percent VaR average more severely than the 95 percent VaR
necessarily follow a predefined statistical distribution. Table 45 average.


02.25.2021 22:54PM 62539
Table 45 Average Market Risk VaR for Trading Activities – 99 percent and 95 percent VaR Statistics
2020 2019
(Dollars in millions) 99 percent 95 percent 99 percent 95 percent
Foreign exchange $ 7 $ 4 $ 6 $ 3
Interest rate 19 9 24 15
Credit 58 18 23 15
Equity 24 13 22 11
Commodities 6 3 6 3
Portfolio diversification (61) (26) (49) (29)
Total covered positions portfolio 53 21 32 18
Impact from less liquid exposures 27 2 3 2
Total covered positions and less liquid trading positions portfolio 80 23 35 20
Fair value option loans 52 13 10 5
Fair value option hedges 13 7 10 6
Fair value option portfolio diversification (24) (8) (10) (5)
Total fair value option portfolio 41 12 10 6
Portfolio diversification (15) (6) (7) (5)
Total market-based portfolio $ 106 $ 29 $ 38 $ 21
Backtesting Trading-related revenue can be volatile and is largely driven by

The accuracy of the VaR methodology is evaluated by general market conditions and customer demand. Also, trading-
backtesting, which compares the daily VaR results, utilizing a related revenue is dependent on the volume and type of
one-day holding period, against a comparable subset of trading transactions, the level of risk assumed, and the volatility of
revenue. A backtesting excess occurs when a trading loss price and rate movements at any given time within the ever-
exceeds the VaR for the corresponding day. These excesses are changing market environment. Significant daily revenue by
evaluated to understand the positions and market moves that business is monitored and the primary drivers of these are
produced the trading loss with a goal to ensure that the VaR reviewed.
methodology accurately represents those losses. We expect the The following histogram is a graphic depiction of trading
frequency of trading losses in excess of VaR to be in line with volatility and illustrates the daily level of trading-related revenue
the confidence level of the VaR statistic being tested. For for 2020 and 2019. During 2020, positive trading-related
example, with a 99 percent confidence level, we expect one revenue was recorded for 98 percent of the trading days, of
trading loss in excess of VaR every 100 days or between two to which 87 percent were daily trading gains of over $25 million,
three trading losses in excess of VaR over the course of a year. and the largest loss was $90 million. This compares to 2019
The number of backtesting excesses observed can differ from where positive trading-related revenue was recorded for 98
the statistically expected number of excesses if the current level percent of the trading days, of which 80 percent were daily
of market volatility is materially different than the level of trading gains of over $25 million, and the largest loss was $35
market volatility that existed during the three years of historical million.
data used in the VaR calculation.
The trading revenue used for backtesting is defined by
regulatory agencies in order to most closely align with the VaR
component of the regulatory capital calculation. This revenue
differs from total trading-related revenue in that it excludes
revenue from trading activities that either do not generate
market risk or the market risk cannot be included in VaR. Some
examples of the types of revenue excluded for backtesting are
fees, commissions, reserves, net interest income and intra-day
trading revenues.
We conduct daily backtesting on the VaR results used for
regulatory capital calculations as well as the VaR results for key
legal entities, regions and risk factors. These results are
reported to senior market risk management. Senior Trading Portfolio Stress Testing
management regularly reviews and evaluates the results of Because the very nature of a VaR model suggests results can
these tests. exceed our estimates and it is dependent on a limited historical
During 2020, there were seven days where this subset of window, we also stress test our portfolio using scenario
trading revenue had losses that exceeded our total covered analysis. This analysis estimates the change in the value of our
portfolio VaR, utilizing a one-day holding period. trading portfolio that may result from abnormal market
movements.
Total Trading-related Revenue A set of scenarios, categorized as either historical or
Total trading-related revenue, excluding brokerage fees, and hypothetical, are computed daily for the overall trading portfolio
CVA, DVA and funding valuation adjustment gains (losses), and individual businesses. These scenarios include shocks to
represents the total amount earned from trading positions, underlying market risk factors that may be well beyond the
including market-based net interest income, which are taken in shocks found in the historical data used to calculate VaR.
a diverse range of financial instruments and markets. For more Historical scenarios simulate the impact of the market moves
information on fair value, see Note 20 – Fair Value that occurred during a period of extended historical market
Measurements to the Consolidated Financial Statements. stress. Generally, a multi-week period representing the most

02.25.2021 22:54PM 62539
severe point during a crisis is selected for each historical shocks to the market-based forward curve. Periodically we
scenario. Hypothetical scenarios provide estimated portfolio evaluate the scenarios presented so that they are meaningful in
impacts from potential future market stress events. Scenarios the context of the current rate environment. The interest rate
are reviewed and updated in response to changing positions scenarios also assume U.S. dollar rates are floored at zero.
and new economic or political information. In addition, new or During 2020, the asset sensitivity of our balance sheet
ad hoc scenarios are developed to address specific potential increased in both up-rate and down-rate scenarios primarily due
market events or particular vulnerabilities in the portfolio. The to continued deposit growth invested in long-term securities. We
stress tests are reviewed on a regular basis and the results are continue to be asset sensitive to a parallel upward move in
presented to senior management. interest rates with the majority of that impact coming from the
Stress testing for the trading portfolio is integrated with short end of the yield curve. Additionally, higher interest rates
enterprise-wide stress testing and incorporated into the limits impact the fair value of debt securities and, accordingly, for
framework. The macroeconomic scenarios used for enterprise- debt securities classified as AFS, may adversely affect
wide stress testing purposes differ from the typical trading accumulated OCI and thus capital levels under the Basel 3
portfolio scenarios in that they have a longer time horizon and capital rules. Under instantaneous upward parallel shifts, the
the results are forecasted over multiple periods for use in near-term adverse impact to Basel 3 capital is reduced over
consolidated capital and liquidity planning. For more time by offsetting positive impacts to net interest income. For
information, see Managing Risk on page 70. more information on Basel 3, see Capital Management –
Regulatory Capital on page 74.
Interest Rate Risk Management for the Banking
Book
The following discussion presents net interest income for Table 47 Estimated Banking Book Net Interest Income
banking book activities. Sensitivity to Curve Changes
Interest rate risk represents the most significant market risk Short Long
exposure to our banking book balance sheet. Interest rate risk Rate Rate December 31
is measured as the potential change in net interest income (Dollars in millions) (bps) (bps) 2020 2019
caused by movements in market interest rates. Client-facing Parallel Shifts
+100 bps
activities, primarily lending and deposit-taking, create interest
instantaneous shift +100 +100 $ 10,468 $ 4,190
rate sensitive positions on our balance sheet. -25 bps
We prepare forward-looking forecasts of net interest income. instantaneous shift -25 -25 (2,766) (1,500)
The baseline forecast takes into consideration expected future Flatteners
business growth, ALM positioning -and the direction of interest Short-end
rate movements as implied by the market-based forward curve. instantaneous change +100 — 6,321 2,641
Long-end
We then measure and evaluate the impact that alternative instantaneous change — -25 (1,686) (653)
interest rate scenarios have on the baseline forecast in order to Steepeners
assess interest rate sensitivity under varied conditions. The net Short-end
interest income forecast is frequently updated for changing instantaneous change -25 — (1,084) (844)
assumptions and differing outlooks based on economic trends, Long-end
market conditions and business strategies. Thus, we continually instantaneous change — +100 4,333 1,561
monitor our balance sheet position in order to maintain an
The sensitivity analysis in Table 47 assumes that we take no
acceptable level of exposure to interest rate changes.
action in response to these rate shocks and does not assume
The interest rate scenarios that we analyze incorporate
any change in other macroeconomic variables normally
balance sheet assumptions such as loan and deposit growth
correlated with changes in interest rates. As part of our ALM
and pricing, changes in funding mix, product repricing, maturity
activities, we use securities, certain residential mortgages, and
characteristics and investment securities premium amortization.
interest rate and foreign exchange derivatives in managing
Our overall goal is to manage interest rate risk so that
interest rate sensitivity.
movements in interest rates do not significantly adversely affect
The behavior of our deposits portfolio in the baseline
earnings and capital.
forecast and in alternate interest rate scenarios is a key
Table 46 presents the spot and 12-month forward rates used
assumption in our projected estimates of net interest income.
in our baseline forecasts at December 31, 2020 and 2019.
The sensitivity analysis in Table 47 assumes no change in
deposit portfolio size or mix from the baseline forecast in
Table 46 Forward Rates alternate rate environments. In higher rate scenarios, any
customer activity resulting in the replacement of low-cost or non-
December 31, 2020 interest-bearing deposits with higher yielding deposits or market-
Federal Three-month 10-Year
Funds LIBOR Swap
based funding would reduce our benefit in those scenarios.
Spot rates 0.25 % 0.24 % 0.93 %
12-month forward rates 0.25 0.19 1.06
Interest Rate and Foreign Exchange Derivative
Contracts
December 31, 2019 Interest rate and foreign exchange derivative contracts are
Spot rates 1.75 % 1.91 % 1.90 %
utilized in our ALM activities and serve as an efficient tool to
12-month forward rates 1.50 1.62 1.92

manage our interest rate and foreign exchange risk. We use
derivatives to hedge the variability in cash flows or changes in
Table 47 shows the pretax impact to forecasted net interest
fair value on our balance sheet due to interest rate and foreign
income over the next 12 months from December 31, 2020 and
exchange components. For more information on our hedging
2019 resulting from instantaneous parallel and non-parallel


02.25.2021 22:54PM 62539
activities, see Note 3 – Derivatives to the Consolidated Financial cash flows. Assuming no change in open cash flow derivative
Statements. hedge positions and no changes in prices or interest rates
Our interest rate contracts are generally non-leveraged beyond what is implied in forward yield curves at December 31,
generic interest rate and foreign exchange basis swaps, 2020, the after-tax net gains are expected to be reclassified
options, futures and forwards. In addition, we use foreign into earnings as follows: a gain of $187 million within the next
exchange contracts, including cross-currency interest rate year, a gain of $358 million in years two through five, a loss of
swaps, foreign currency futures contracts, foreign currency $59 million in years six through ten, with the remaining loss of
forward contracts and options to mitigate the foreign exchange $50 million thereafter. For more information on derivatives
risk associated with foreign currency-denominated assets and designated as cash flow hedges, see Note 3 – Derivatives to the
liabilities. Consolidated Financial Statements.
Changes to the composition of our derivatives portfolio We hedge our net investment in non-U.S. operations
during 2020 reflect actions taken for interest rate and foreign determined to have functional currencies other than the U.S.
exchange rate risk management. The decisions to reposition our dollar using forward foreign exchange contracts that typically
derivatives portfolio are based on the current assessment of settle in less than 180 days, cross-currency basis swaps and
economic and financial conditions including the interest rate foreign exchange options. We recorded net after-tax losses on
and foreign currency environments, balance sheet composition derivatives in accumulated OCI associated with net investment
and trends, and the relative mix of our cash and derivative hedges which were offset by gains on our net investments in
positions. consolidated non-U.S. entities at December 31, 2020.
We use interest rate derivative instruments to hedge the Table 48 presents derivatives utilized in our ALM activities
variability in the cash flows of our assets and liabilities and and shows the notional amount, fair value, weighted-average
other forecasted transactions (collectively referred to as cash receive-fixed and pay-fixed rates, expected maturity and average
flow hedges). The net results on both open and terminated cash estimated durations of our open ALM derivatives at
flow hedge derivative instruments recorded in accumulated OCI December 31, 2020 and 2019. These amounts do not include
were a gain of $580 million and a loss of $496 million, on a derivative hedges on our MSRs. During 2020, the fair value of
pretax basis, at December 31, 2020 and 2019. These gains receive-fixed interest rate swaps increased while pay-fixed
and losses are expected to be reclassified into earnings in the interest swaps decreased, primarily driven by lower swap rates
same period as the hedged cash flows affect earnings and will on hedges of U.S. dollar long-term debt.
decrease income or increase expense on the respective hedged
Table 48 Asset and Liability Management Interest Rate and Foreign Exchange Contracts
December 31, 2020
Expected Maturity
Average
(Dollars in millions, average estimated duration in Fair Estimated
years) Value Total 2021 2022 2023 2024 2025 Thereafter Duration
Receive-fixed interest rate swaps (1) $ 14,885 8.08
Notional amount $269,015 $ 11,050 $ 20,908 $ 30,654 $ 31,317 $ 32,898 $142,188
Weighted-average fixed-rate 1.54 % 3.25 % 0.91 % 1.48 % 1.17 % 1.07 % 1.69 %
Pay-fixed interest rate swaps (1) (5,502) 6.52
Notional amount $252,698 $ 7,562 $ 21,667 $ 24,671 $ 24,406 $ 32,052 $142,340
Same-currency basis swaps (2) (235)
Notional amount $223,659 $ 18,769 $ 12,245 $ 9,747 $ 22,737 $ 28,222 $131,939
Foreign exchange basis swaps (1, 3, 4) (1,014)
Notional amount 112,465 27,424 16,038 8,066 3,819 4,446 52,672
Foreign exchange contracts (1, 4, 5) 349
Notional amount (6) (42,490) (69,299) 2,841 2,505 4,735 4,369 12,359
Futures and forward rate contracts 47
Notional amount 14,255 14,255 — — — — —
Option products —
Notional amount 17 — — 17 — — —
Net ALM contracts $ 8,530


02.25.2021 22:54PM 62539
Table 48 Asset and Liability Management Interest Rate and Foreign Exchange Contracts (continued)
December 31, 2019
Expected Maturity
Average
(Dollars in millions, average estimated duration in Fair Estimated
years) Value Total 2020 2021 2022 2023 2024 Thereafter Duration
Receive-fixed interest rate swaps (1) $ 12,370 6.47
Notional amount $215,123 $ 16,347 $ 14,642 $ 21,616 $ 36,356 $ 21,257 $104,905
Pay-fixed interest rate swaps (1) (2,669) 6.99
Notional amount $ 69,586 $ 4,344 $ 2,117 $ — $ 13,993 $ 8,194 $ 40,938
Weighted-average fixed-rate 2.36 % 2.16 % 2.15 % —% 2.52 % 2.26 % 2.35 %
Same-currency basis swaps (2) (290)
Notional amount $152,160 $ 18,857 $ 18,590 $ 4,306 $ 2,017 $ 14,567 $ 93,823
Foreign exchange basis swaps (1, 3, 4) (1,258)
Notional amount 113,529 23,639 24,215 14,611 7,111 3,521 40,432
Foreign exchange contracts (1, 4, 5) 414
Notional amount (6) (53,106) (79,315) 4,539 2,674 2,340 4,432 12,224
Option products —
Notional amount 15 — — — 15 — —
Net ALM contracts $ 8,567
(1)
Does not include basis adjustments on either fixed-rate debt issued by the Corporation or AFS debt securities, which are hedged using derivatives designated as fair value hedging instruments,
that substantially offset the fair values of these derivatives.
(2)
At December 31, 2020 and 2019, the notional amount of same-currency basis swaps included $223.7 billion and $152.2 billion in both foreign currency and U.S. dollar-denominated basis swaps
in which both sides of the swap are in the same currency.
(3)
Foreign exchange basis swaps consisted of cross-currency variable interest rate swaps used separately or in conjunction with receive-fixed interest rate swaps.
(4)
Does not include foreign currency translation adjustments on certain non-U.S. debt issued by the Corporation that substantially offset the fair values of these derivatives.
(5)
The notional amount of foreign exchange contracts of $(42.5) billion at December 31, 2020 was comprised of $34.2 billion in foreign currency-denominated and cross-currency receive-fixed
swaps, $(74.3) billion in net foreign currency forward rate contracts, $(3.1) billion in foreign currency-denominated interest rate swaps and $711 million in net foreign currency futures contracts.
Foreign exchange contracts of $(53.1) billion at December 31, 2019 were comprised of $29.0 billion in foreign currency-denominated and cross-currency receive-fixed swaps, $(82.4) billion in net
foreign currency forward rate contracts, $(313) million in foreign currency-denominated interest rate swaps and $644 million in foreign currency futures contracts.
(6)
Reflects the net of long and short positions. Amounts shown as negative reflect a net short position.
Mortgage Banking Risk Management events. Operational risk may occur anywhere in the Corporation,
We originate, fund and service mortgage loans, which subject us including third-party business processes, and is not limited to
to credit, liquidity and interest rate risks, among others. We operations functions. Effects may extend beyond financial
determine whether loans will be held for investment or held for losses and may result in reputational risk impacts. Operational
sale at the time of commitment and manage credit and liquidity risk includes legal risk. Additionally, operational risk is a
risks by selling or securitizing a portion of the loans we component in the calculation of total RWA used in the Basel 3
originate. capital calculation. For more information on Basel 3
Interest rate risk and market risk can be substantial in the calculations, see Capital Management on page 73.
mortgage business. Changes in interest rates and other market FLUs and control functions are first and foremost responsible
factors impact the volume of mortgage originations. Changes in for managing all aspects of their businesses, including their
interest rates also impact the value of interest rate lock compliance and operational risk. FLUs and control functions are
commitments (IRLCs) and the related residential first mortgage required to understand their business processes and related
loans held-for-sale (LHFS) between the date of the IRLC and the risks and controls, including third-party dependencies, the
date the loans are sold to the secondary market. An increase in related regulatory requirements, and monitor and report on the
mortgage interest rates typically leads to a decrease in the effectiveness of the control environment. In order to actively
value of these instruments. Conversely, when there is an monitor and assess the performance of their processes and
increase in interest rates, the value of the MSRs will increase controls, they must conduct comprehensive quality assurance
driven by lower prepayment expectations. Because the interest activities and identify issues and risks to remediate control
rate risks of these hedged items offset, we combine them into gaps and weaknesses. FLUs and control functions must also
one overall hedged item with one combined economic hedge adhere to compliance and operational risk appetite limits to
portfolio consisting of derivative contracts and securities. meet strategic, capital and financial planning objectives. Finally,
During 2020, 2019 and 2018, we recorded gains of $321 FLUs and control functions are responsible for the proactive
million, $291 million and $244 million related to the change in identification, management and escalation of compliance and
fair value of the MSRs, IRLCs and LHFS, net of gains and losses operational risks across the Corporation.
on the hedge portfolio. For more information on MSRs, see Note Global Compliance and Operational Risk teams
20 – Fair Value Measurements to the Consolidated Financial independently assess compliance and operational risk, monitor
Statements. business activities and processes and evaluate FLUs and
control functions for adherence to applicable laws, rules and
Compliance and Operational Risk Management regulations, including identifying issues and risks, determining
Compliance risk is the risk of legal or regulatory sanctions, and developing tests to be conducted by the Enterprise
material financial loss or damage to the reputation of the Independent Testing unit, and reporting on the state of the
Corporation arising from the failure of the Corporation to comply control environment. Enterprise Independent Testing, an
with the requirements of applicable laws, rules, regulations and independent testing function within IRM, works with Global
our internal policies and procedures (collectively, applicable Compliance and Operational Risk, the FLUs and control
laws, rules and regulations). functions in the identification of testing needs and test design,
Operational risk is the risk of loss resulting from inadequate and is accountable for test execution, reporting and analysis of
or failed processes, people and systems or from external results.


02.25.2021 22:54PM 62539
Corporate Audit provides independent assessment and changes, and (2) risks related to the physical impacts of climate
validation through testing of key compliance and operational risk change, driven by extreme weather events, such as hurricanes
processes and controls across the Corporation. and floods, as well as chronic longer-term shifts, such as
The Corporation's Global Compliance Enterprise Policy and temperature increases and sea level rises. These changes and
Operational Risk Management – Enterprise Policy set the events can have broad impacts on operations, supply chains,
requirements for reporting compliance and operational risk distribution networks, customers, and markets and are
information to executive management as well as the Board or otherwise referred to, respectively, as transition risk and
appropriate Board-level committees in support of Global physical risk. The financial impacts of transition risk can lead to
Compliance and Operational Risk’s responsibilities for and amplify credit risk. Physical risk can also lead to increased
conducting independent oversight of our compliance and credit risk by diminishing borrowers’ repayment capacity or
operational risk management activities. The Board provides collateral values.
oversight of compliance risk through its Audit Committee and As climate risk is interconnected with all key risk types, we
the ERC, and operational risk through the ERC. have developed and continue to enhance processes to embed
A key operational risk facing the Corporation is information climate risk considerations into our Risk Framework and risk
security, which includes cybersecurity. Cybersecurity risk management programs established for strategic, credit, market,
represents, among other things, exposure to failures or liquidity, compliance, operational and reputational risks. A key
interruptions of service or breaches of security, including as a element of how we manage climate risk is the Risk
result of malicious technological attacks, that impact the Identification process through which climate and other risks are
confidentiality, availability or integrity of our, or third identified across all FLUs and control functions, prioritized in our
parties' (including their downstream service providers, the risk inventory and evaluated to determine estimated severity
financial services industry and financial data aggregators) and likelihood of occurrence. Once identified, climate risks are
operations, systems or data, including sensitive corporate and assessed for potential impacts and incorporated into the design
customer information. The Corporation manages information of macroeconomic scenarios to generate loss forecasts and
security risk in accordance with internal policies which govern assess how climate-related impacts could affect us and our
our comprehensive information security program designed to clients.
protect the Corporation by enabling preventative, detective and Our governance framework establishes oversight of climate
responsive measures to combat information and cybersecurity risk practices and strategies by the Board, supported by its
risks. The Board and the ERC provide cybersecurity and Corporate Governance, ESG, and Sustainability Committee, the
information security risk oversight for the Corporation, and our ERC and the Global Environmental, Social and Governance
Global Information Security Team manages the day-to-day Committee, a management-level committee comprised of senior
implementation of our information security program. leaders across every major FLU and control function. The
Climate Risk Steering Council oversees our climate risk
Reputational Risk Management management practices, shapes our approach to managing
Reputational risk is the risk that negative perceptions of the climate-related risks in line with our Risk Framework and meets
Corporation’s conduct or business practices may adversely monthly. In 2020, the climate risk management effort was
impact its profitability or operations. Reputational risk may bolstered through the appointment of a Global Climate Risk
result from many of the Corporation’s activities, including those Executive who reports to the CRO, and establishment of a new
related to the management of our strategic, operational, division within our Global Risk organization to drive execution of
compliance and credit risks. the climate risk management program with the support of FLUs,
The Corporation manages reputational risk through Technology & Operations and Risk partners. For additional
established policies and controls in its businesses and risk information about climate risk, see the Bank of America website
management processes to mitigate reputational risks in a timely (the content of which is not incorporated by reference into this
manner and through proactive monitoring and identification of Annual Report on Form 10-K).
potential reputational risk events. If reputational risk events
occur, we focus on remediating the underlying issue and taking Complex Accounting Estimates
action to minimize damage to the Corporation’s reputation. The Our significant accounting principles, as described in Note 1 –
Corporation has processes and procedures in place to respond Summary of Significant Accounting Principles to the Consolidated
to events that give rise to reputational risk, including educating Financial Statements, are essential in understanding the MD&A.
individuals and organizations that influence public opinion, Many of our significant accounting principles require complex
implementing external communication strategies to mitigate the judgments to estimate the values of assets and liabilities. We
risk, and informing key stakeholders of potential reputational have procedures and processes in place to facilitate making
risks. The Corporation’s organization and governance structure these judgments.
provides oversight of reputational risks, and reputational risk The more judgmental estimates are summarized in the
reporting is provided regularly and directly to management and following discussion. We have identified and described the
the ERC, which provides primary oversight of reputational risk. development of the variables most important in the estimation
In addition, each FLU has a committee, which includes processes that involve mathematical models to derive the
representatives from Compliance, Legal and Risk, that is estimates. In many cases, there are numerous alternative
responsible for the oversight of reputational risk. Such judgments that could be used in the process of determining the
committees’ oversight includes providing approval for business inputs to the models. Where alternatives exist, we have used
the factors that we believe represent the most reasonable value
activities that present elevated levels of reputational risks.

in developing the inputs. Actual performance that differs from
Climate Risk Management our estimates of the key variables could materially impact our
Climate-related risks are divided into two major categories: (1) results of operations. Separate from the possible future impact
risks related to the transition to a low-carbon economy, which to our results of operations from input and model variables, the
may entail extensive policy, legal, technology and market value of our lending portfolio and market-sensitive assets and

02.25.2021 22:54PM 62539
liabilities may change subsequent to the balance sheet date, and Leases and Allowance for Credit Losses to the Consolidated
often significantly, due to the nature and magnitude of future Financial Statements.
credit and market conditions. Such credit and market conditions
may change quickly and in unforeseen ways and the resulting Fair Value of Financial Instruments
volatility could have a significant, negative effect on future Under applicable accounting standards, we are required to
operating results. These fluctuations would not be indicative of maximize the use of observable inputs and minimize the use of
deficiencies in our models or inputs. unobservable inputs in measuring fair value. We classify fair
value measurements of financial instruments and MSRs based
Allowance for Credit Losses on the three-level fair value hierarchy in the accounting
On January 1, 2020, the Corporation adopted the new standards.
accounting standard that requires the measurement of the The fair values of assets and liabilities may include
allowance for credit losses, which includes the allowance for adjustments, such as market liquidity and credit quality, where
loan and lease losses and the reserve for unfunded lending appropriate. Valuations of products using models or other
commitments, to be based on management’s best estimate of techniques are sensitive to assumptions used for the significant
lifetime ECL inherent in the Corporation's relevant financial inputs. Where market data is available, the inputs used for
assets. valuation reflect that information as of our valuation date.
The Corporation's estimate of lifetime ECL includes the use Inputs to valuation models are considered unobservable if they
of quantitative models that incorporate forward-looking are supported by little or no market activity. In periods of
macroeconomic scenarios that are applied over the contractual extreme volatility, lessened liquidity or in illiquid markets, there
life of the loan portfolios, adjusted for expected prepayments may be more variability in market pricing or a lack of market
and borrower-controlled extension options. These data to use in the valuation process. In keeping with the
macroeconomic scenarios include variables that have prudent application of estimates and management judgment in
historically been key drivers of increases and decreases in determining the fair value of assets and liabilities, we have in
credit losses. These variables include, but are not limited to, place various processes and controls that include: a model
unemployment rates, real estate prices, gross domestic product validation policy that requires review and approval of
and corporate bond spreads. As any one economic outlook is quantitative models used for deal pricing, financial statement
inherently uncertain, the Corporation leverages multiple fair value determination and risk quantification; a trading
scenarios. The scenarios that are chosen each quarter and the product valuation policy that requires verification of all traded
amount of weighting given to each scenario depend on a variety product valuations; and a periodic review and substantiation of
of factors including recent economic events, leading economic daily profit and loss reporting for all traded products. Primarily
indicators, views of internal and third-party economists and through validation controls, we utilize both broker and pricing
industry trends. service inputs which can and do include both market-observable
The Corporation also includes qualitative reserves to cover and internally-modeled values and/or valuation inputs. Our
losses that are expected but, in the Corporation's assessment, reliance on this information is affected by our understanding of
may not be adequately reflected in the economic assumptions how the broker and/or pricing service develops its data with a
described above. For example, factors the Corporation higher degree of reliance applied to those that are more directly
considers include changes in lending policies and procedures, observable and lesser reliance applied to those developed
business conditions, the nature and size of the portfolio, through their own internal modeling. For example, broker quotes
portfolio concentrations, the volume and severity of past due in less active markets may only be indicative and therefore less
loans and nonaccrual loans, the effect of external factors such reliable. These processes and controls are performed
as competition and legal and regulatory requirements, among independently of the business. For more information, see Note
others. Further, the Corporation considers the inherent 20 – Fair Value Measurements and Note 21 – Fair Value Option
uncertainty in quantitative models that are built on historical to the Consolidated Financial Statements.
data.
The allowance for credit losses can also be impacted by Level 3 Assets and Liabilities
unanticipated changes in asset quality of the portfolio, such as Financial assets and liabilities, and MSRs, where values are
increases in risk rating downgrades in our commercial portfolio, based on valuation techniques that require inputs that are both
deterioration in borrower delinquencies or credit scores in our unobservable and are significant to the overall fair value
credit card portfolio or increases in LTVs in our consumer real measurement are classified as Level 3 under the fair value
estate portfolio. In addition, while we have incorporated our hierarchy established in applicable accounting standards. The
estimated impact of COVID-19 into our allowance for credit fair value of these Level 3 financial assets and liabilities and
losses, the ultimate impact of the pandemic is still unknown, MSRs is determined using pricing models, discounted cash flow
including how long economic activities will be impacted and methodologies or similar techniques for which the determination
what effect the unprecedented levels of government fiscal and of fair value requires significant management judgment or
monetary actions will have on the economy and our credit estimation.
losses. Level 3 financial instruments may be hedged with derivatives
As described above, the process to determine the allowance classified as Level 1 or 2; therefore, gains or losses associated
for credit losses requires numerous estimates and with Level 3 financial instruments may be offset by gains or
assumptions, some of which require a high degree of judgment losses associated with financial instruments classified in other
and are often interrelated. Changes in the estimates and levels of the fair value hierarchy. The Level 3 gains and losses
assumptions can result in significant changes in the allowance recorded in earnings did not have a significant impact on our
for credit losses. Our process for determining the allowance for liquidity or capital. We conduct a review of our fair value
credit losses is further discussed in Note 1 – Summary of hierarchy classifications on a quarterly basis. Transfers into or
Significant Accounting Principles and Note 5 – Outstanding Loans out of Level 3 are made if the significant inputs used in the
financial models measuring the fair values of the assets and


02.25.2021 22:54PM 62539
liabilities became unobservable or observable, respectively, in We completed our annual goodwill impairment test as of
the current marketplace. For more information on transfers into June 30, 2020. In performing that test, we compared the fair
and out of Level 3 during 2020, 2019 and 2018, see Note 20 – value of each reporting unit to its estimated carrying value as
Fair Value Measurements to the Consolidated Financial measured by allocated equity. We estimated the fair value of
Statements. each reporting unit based on the income approach (which
utilizes the present value of cash flows to estimate fair value)
Accrued Income Taxes and Deferred Tax Assets and the market multiplier approach (which utilizes observable
Accrued income taxes, reported as a component of either other market prices and metrics of peer companies to estimate fair
assets or accrued expenses and other liabilities on the value).
Consolidated Balance Sheet, represent the net amount of Our discounted cash flows were generally based on the
current income taxes we expect to pay to or receive from Corporation’s three-year internal forecasts with a long-term
various taxing jurisdictions attributable to our operations to growth rate of 3.68 percent. Our estimated cash flows
date. We currently file income tax returns in more than 100 considered the current challenging global industry and market
jurisdictions and consider many factors, including statutory, conditions related to the pandemic, including the low interest
judicial and regulatory guidance, in estimating the appropriate rate environment. The cash flows were discounted using rates
accrued income taxes for each jurisdiction. that ranged from 9 percent to 12 percent, which were derived
Net deferred tax assets, reported as a component of other from a capital asset pricing model that incorporates the risk and
assets on the Consolidated Balance Sheet, represent the net uncertainty in the cash flow forecasts, the financial markets and
decrease in taxes expected to be paid in the future because of industries similar to each of the reporting units.
net operating loss (NOL) and tax credit carryforwards and Under the market multiplier approach, we estimated the fair
because of future reversals of temporary differences in the value of the individual reporting units utilizing various market
bases of assets and liabilities as measured by tax laws and multiples, primarily various pricing multiples, from comparable
their bases as reported in the financial statements. NOL and tax publicly-traded companies in industries similar to the reporting
credit carryforwards result in reductions to future tax liabilities, unit and then factored in a control premium based upon
and many of these attributes can expire if not utilized within observed comparable premiums paid for change-in-control
certain periods. We consider the need for valuation allowances transactions for financial institutions.
to reduce net deferred tax assets to the amounts that we Based on the results of the test, we determined that each
estimate are more likely than not to be realized. reporting unit’s estimated fair value exceeded its respective
Consistent with the applicable accounting guidance, we carrying value and that the goodwill assigned to each reporting
monitor relevant tax authorities and change our estimates of unit was not impaired. The fair values of the reporting units as a
accrued income taxes and/or net deferred tax assets due to percentage of their carrying values ranged from 109 percent to
changes in income tax laws and their interpretation by the 213 percent. It currently remains difficult to estimate the future
courts and regulatory authorities. These revisions of our economic impacts related to the pandemic. If economic and
estimates, which also may result from our income tax planning market conditions (both in the U.S. and internationally)
and from the resolution of income tax audit matters, may be deteriorate, our reporting units could be negatively impacted,
material to our operating results for any given period. which could change our key assumptions and related estimates
See Note 19 – Income Taxes to the Consolidated Financial and may result in a future impairment charge.
Statements for a table of significant tax attributes and
Certain Contingent Liabilities
additional information. For more information, see Item 1A. Risk
For more information on the complex judgments associated with
Factors of our 2020 Annual Report on Form 10-K.
certain contingent liabilities, see Note 12 – Commitments and
Goodwill and Intangible Assets Contingencies to the Consolidated Financial Statements.
The nature of and accounting for goodwill and intangible assets
are discussed in Note 1 – Summary of Significant Accounting
Principles, and Note 7 – Goodwill and Intangible Assets to the


02.25.2021 22:54PM 62539
Non-GAAP Reconciliations
Tables 49 and 50 provide reconciliations of certain non-GAAP financial measures to GAAP financial measures.
Table 49 Five-year Reconciliations to GAAP Financial Measures (1)

(Dollars in millions, shares in thousands) 2020 2019 2018 2017 2016
Reconciliation of average shareholders’ equity to average tangible shareholders’ equity and
average tangible common shareholders’ equity
Shareholders’ equity $ 267,309 $ 267,889 $ 264,748 $ 271,289 $ 265,843
Goodwill (68,951) (68,951) (68,951) (69,286) (69,750)
Intangible assets (excluding MSRs) (1,862) (1,721) (2,058) (2,652) (3,382)
Related deferred tax liabilities 821 773 906 1,463 1,644
Tangible shareholders’ equity $ 197,317 $ 197,990 $ 194,645 $ 200,814 $ 194,355
Preferred stock (23,624) (23,036) (22,949) (24,188) (24,656)
Tangible common shareholders’ equity $ 173,693 $ 174,954 $ 171,696 $ 176,626 $ 169,699
Reconciliation of year-end shareholders’ equity to year-end tangible shareholders’ equity and
year-end tangible common shareholders’ equity
Shareholders’ equity $ 272,924 $ 264,810 $ 265,325 $ 267,146 $ 266,195
Goodwill (68,951) (68,951) (68,951) (68,951) (69,744)
Related deferred tax liabilities 920 713 858 943 1,545
Tangible shareholders’ equity $ 202,742 $ 194,911 $ 195,458 $ 196,826 $ 195,007
Preferred stock (24,510) (23,401) (22,326) (22,323) (25,220)
Tangible common shareholders’ equity $ 178,232 $ 171,510 $ 173,132 $ 174,503 $ 169,787
Reconciliation of year-end assets to year-end tangible assets
Assets $ 2,819,627 $2,434,079 $2,354,507 $2,281,234 $2,188,067
Goodwill (68,951) (68,951) (68,951) (68,951) (69,744)
Related deferred tax liabilities 920 713 858 943 1,545
Tangible assets $ 2,749,445 $2,364,180 $2,284,640 $2,210,914 $2,116,879
(1)
Presents reconciliations of non-GAAP financial measures to GAAP financial measures. For more information on non-GAAP financial measures and ratios we use in assessing the results of the
Corporation, see Supplemental Financial Data on page 54.
Table 50 Quarterly Reconciliations to GAAP Financial Measures (1)

2020 Quarters 2019 Quarters
(Dollars in millions) Fourth Third Second First Fourth Third Second First
Reconciliation of average shareholders’ equity to average tangible
shareholders’ equity and average tangible common shareholders’
equity
Shareholders’ equity $ 271,020 $ 267,323 $ 266,316 $ 264,534 $ 266,900 $ 270,430 $ 267,975 $ 266,217
Goodwill (68,951) (68,951) (68,951) (68,951) (68,951) (68,951) (68,951) (68,951)
Intangible assets (excluding MSRs) (2,173) (1,976) (1,640) (1,655) (1,678) (1,707) (1,736) (1,763)
Related deferred tax liabilities 910 855 790 728 730 752 770 841
Tangible shareholders’ equity $ 200,806 $ 197,251 $ 196,515 $ 194,656 $ 197,001 $ 200,524 $ 198,058 $ 196,344
Preferred stock (24,180) (23,427) (23,427) (23,456) (23,461) (23,800) (22,537) (22,326)
Tangible common shareholders’ equity $ 176,626 $ 173,824 $ 173,088 $ 171,200 $ 173,540 $ 176,724 $ 175,521 $ 174,018
Reconciliation of period-end shareholders’ equity to period-end tangible
shareholders’ equity and period-end tangible common shareholders’
equity
Shareholders’ equity $ 272,924 $ 268,850 $ 265,637 $ 264,918 $ 264,810 $ 268,387 $ 271,408 $ 267,010
Goodwill (68,951) (68,951) (68,951) (68,951) (68,951) (68,951) (68,951) (68,951)
Tangible shareholders’ equity $ 202,742 $ 198,624 $ 195,845 $ 195,111 $ 194,911 $ 198,480 $ 201,495 $ 197,085
Preferred stock (24,510) (23,427) (23,427) (23,427) (23,401) (23,606) (24,689) (22,326)
Tangible common shareholders’ equity $ 178,232 $ 175,197 $ 172,418 $ 171,684 $ 171,510 $ 174,874 $ 176,806 $ 174,759
Reconciliation of period-end assets to period-end tangible assets
Assets $ 2,819,627 $ 2,738,452 $2,741,688 $ 2,619,954 $ 2,434,079 $2,426,330 $ 2,395,892 $ 2,377,164
Goodwill (68,951) (68,951) (68,951) (68,951) (68,951) (68,951) (68,951) (68,951)
Tangible assets $ 2,749,445 $ 2,668,226 $2,671,896 $ 2,550,147 $ 2,364,180 $2,356,423 $ 2,325,979 $ 2,307,239
(1)
Presents reconciliations of non-GAAP financial measures to GAAP financial measures. For more information on non-GAAP financial measures and ratios we use in assessing the results of the
Corporation, see Supplemental Financial Data on page 54.


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Statistical Tables
Table of Contents
Page
Table I – Outstanding Loans and Leases 112
Table II – Nonperforming Loans, Leases and Foreclosed Properties 113
Table III – Accruing Loans and Leases Past Due 90 Days or More 113
Table IV – Selected Loan Maturity Data 114
Table V – Allowance for Credit Losses 114
Table VI – Allocation of the Allowance for Credit Losses by Product Type 115
Table I Outstanding Loans and Leases

December 31
(Dollars in millions) 2020 2019 2018 2017 2016
Consumer
Residential mortgage $ 223,555 $ 236,169 $ 208,557 $ 203,811 $ 191,797
Home equity 34,311 40,208 48,286 57,744 66,443
Credit card 78,708 97,608 98,338 96,285 92,278
Non-U.S. credit card — — — — 9,214
Direct/Indirect consumer (1) 91,363 90,998 91,166 96,342 95,962
Other consumer (2) 124 192 202 166 626
Total consumer loans excluding loans accounted for under the fair value option 428,061 465,175 446,549 454,348 456,320
Consumer loans accounted for under the fair value option (3) 735 594 682 928 1,051
Total consumer 428,796 465,769 447,231 455,276 457,371
Commercial
U.S. commercial 288,728 307,048 299,277 284,836 270,372
Non-U.S. commercial 90,460 104,966 98,776 97,792 89,397
Commercial real estate (4) 60,364 62,689 60,845 58,298 57,355
Commercial lease financing 17,098 19,880 22,534 22,116 22,375
456,650 494,583 481,432 463,042 439,499
U.S. small business commercial (5) 36,469 15,333 14,565 13,649 12,993
Total commercial loans excluding loans accounted for under the fair value option 493,119 509,916 495,997 476,691 452,492
Commercial loans accounted for under the fair value option (3) 5,946 7,741 3,667 4,782 6,034
Total commercial 499,065 517,657 499,664 481,473 458,526
Less: Loans of business held for sale (6) — — — — (9,214)
Total loans and leases $ 927,861 $ 983,426 $ 946,895 $ 936,749 $ 906,683
(1)
Includes primarily auto and specialty lending loans and leases of $46.4 billion, $50.4 billion, $50.1 billion, $52.4 billion and $50.7 billion, U.S. securities-based lending loans of $41.1 billion,
$36.7 billion, $37.0 billion, $39.8 billion and $40.1 billion and non-U.S. consumer loans of $3.0 billion, $2.8 billion, $2.9 billion, $3.0 billion and $3.0 billion at December 31, 2020, 2019,
2018, 2017 and 2016, respectively.
(2)
Substantially all of other consumer at December 31, 2020, 2019, 2018 and 2017 is consumer overdrafts. Other consumer at December 31, 2016 also includes consumer finance loans of $465
million.
(3)
Consumer loans accounted for under the fair value option include residential mortgage loans of $298 million, $257 million, $336 million, $567 million and $710 million, and home equity loans of
$437 million, $337 million, $346 million, $361 million and $341 million at December 31, 2020, 2019, 2018, 2017 and 2016, respectively. Commercial loans accounted for under the fair value
option include U.S. commercial loans of $2.9 billion, $4.7 billion, $2.5 billion, $2.6 billion and $2.9 billion, and non-U.S. commercial loans of $3.0 billion, $3.1 billion, $1.1 billion, $2.2 billion
and $3.1 billion at December 31, 2020, 2019, 2018, 2017 and 2016, respectively.
(4)
Includes U.S. commercial real estate loans of $57.2 billion, $59.0 billion, $56.6 billion, $54.8 billion and $54.3 billion, and non-U.S. commercial real estate loans of $3.2 billion, $3.7 billion,
$4.2 billion, $3.5 billion and $3.1 billion at December 31, 2020, 2019, 2018, 2017 and 2016, respectively.
(5)
Includes card-related products.
(6)
Represents non-U.S. credit card loans, which were included in assets of business held for sale on the Consolidated Balance Sheet.


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Table II Nonperforming Loans, Leases and Foreclosed Properties (1)

December 31
Consumer
Residential mortgage $ 2,005 $ 1,470 $ 1,893 $ 2,476 $ 3,056
Home equity 649 536 1,893 2,644 2,918
Direct/Indirect consumer 71 47 56 46 28
Other consumer — — — — 2
Total consumer (2) 2,725 2,053 3,842 5,166 6,004
Commercial
U.S. commercial 1,243 1,094 794 814 1,256
Non-U.S. commercial 418 43 80 299 279
Commercial real estate 404 280 156 112 72
Commercial lease financing 87 32 18 24 36
2,152 1,449 1,048 1,249 1,643
U.S. small business commercial 75 50 54 55 60
Total commercial (3) 2,227 1,499 1,102 1,304 1,703
Total nonperforming loans and leases 4,952 3,552 4,944 6,470 7,707
Foreclosed properties 164 285 300 288 377
Total nonperforming loans, leases and foreclosed properties $ 5,116 $ 3,837 $ 5,244 $ 6,758 $ 8,084
(1)
Balances exclude foreclosed properties insured by certain government-guaranteed loans, principally FHA-insured loans, that entered foreclosure of $119 million, $260 million, $488 million, $801
million and $1.2 billion at December 31, 2020, 2019, 2018, 2017 and 2016, respectively.
(2)
In 2020, $372 million in interest income was estimated to be contractually due on $2.7 billion of consumer loans and leases classified as nonperforming at December 31, 2020, as presented in
the table above, plus $4.4 billion of TDRs classified as performing at December 31, 2020. Approximately $254 million of the estimated $372 million in contractual interest was received and
included in interest income for 2020.
(3)
In 2020, $115 million in interest income was estimated to be contractually due on $2.2 billion of commercial loans and leases classified as nonperforming at December 31, 2020, as presented
in the table above, plus $1.0 billion of TDRs classified as performing at December 31, 2020. Approximately $71 million of the estimated $115 million in contractual interest was received and
included in interest income for 2020.
Table III Accruing Loans and Leases Past Due 90 Days or More (1)
December 31
Consumer
Residential mortgage (2) $ 762 $ 1,088 $ 1,884 $ 3,230 $ 4,793
Credit card 903 1,042 994 900 782
Non-U.S. credit card — — — — 66
Other consumer — — — — 4
Total consumer 1,698 2,163 2,916 4,170 5,679
Commercial
U.S. commercial 228 106 197 144 106
Non-U.S. commercial 10 8 — 3 5
269 153 230 170 137
U.S. small business commercial 115 97 84 75 71
Total commercial 384 250 314 245 208
Total accruing loans and leases past due 90 days or more $ 2,082 $ 2,413 $ 3,230 $ 4,415 $ 5,887
(1)
Our policy is to classify consumer real estate-secured loans as nonperforming at 90 days past due, except for the fully-insured loan portfolio and loans accounted for under the fair value option.
(2)
Balances are fully-insured loans.


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Table IV Selected Loan Maturity Data (1, 2)

December 31, 2020
Due After One
Due in One Year Through Due After
(Dollars in millions) Year or Less Five Years Five Years Total
U.S. commercial $ 82,577 $ 198,898 $ 46,642 $ 328,117
U.S. commercial real estate 14,073 37,552 5,552 57,177
Non-U.S. and other (3) 33,196 54,488 8,989 96,673
Total selected loans $ 129,846 $ 290,938 $ 61,183 $ 481,967
Percent of total 27 % 60 % 13 % 100 %
Sensitivity of selected loans to changes in interest rates for loans due after one year:
Fixed interest rates $ 46,911 $ 32,280
Floating or adjustable interest rates 244,027 28,903
Total $ 290,938 $ 61,183
(1)
Loan maturities are based on the remaining maturities under contractual terms.
(2)
Includes loans accounted for under the fair value option.
(3)
Loan maturities include non-U.S. commercial and commercial real estate loans.
Table V Allowance for Credit Losses (1)

Allowance for loan and lease losses, January 1 $ 12,358 $ 9,601 $ 10,393 $ 11,237 $ 12,234
Loans and leases charged off
Residential mortgage (40) (93) (207) (188) (403)
Home equity (58) (429) (483) (582) (752)
Credit card (2,967) (3,535) (3,345) (2,968) (2,691)
Non-U.S. credit card (2) — — — (103) (238)
Direct/Indirect consumer (372) (518) (495) (491) (392)
Other consumer (307) (249) (197) (212) (232)
Total consumer charge-offs (3,744) (4,824) (4,727) (4,544) (4,708)
U.S. commercial (3) (1,163) (650) (575) (589) (567)
Non-U.S. commercial (168) (115) (82) (446) (133)
Commercial real estate (275) (31) (10) (24) (10)
Commercial lease financing (69) (26) (8) (16) (30)
Total commercial charge-offs (1,675) (822) (675) (1,075) (740)
Total loans and leases charged off (5,419) (5,646) (5,402) (5,619) (5,448)
Recoveries of loans and leases previously charged off
Residential mortgage 70 140 179 288 272
Home equity 131 787 485 369 347
Credit card 618 587 508 455 422
Non-U.S. credit card (2) — — — 28 63
Other consumer 23 15 15 49 27
Total consumer recoveries 1,092 1,838 1,487 1,466 1,389
U.S. commercial (4) 178 122 120 142 175
Non-U.S. commercial 13 31 14 6 13
Total commercial recoveries 206 160 152 174 238
Total recoveries of loans and leases previously charged off 1,298 1,998 1,639 1,640 1,627
Net charge-offs (4,121) (3,648) (3,763) (3,979) (3,821)
Provision for loan and lease losses 10,565 3,574 3,262 3,381 3,581
Other (5) — (111) (291) (246) (514)
Total allowance for loan and lease losses, December 31 18,802 9,416 9,601 10,393 11,480
Less: Allowance included in assets of business held for sale (6) — — — — (243)
Allowance for loan and lease losses, December 31 18,802 9,416 9,601 10,393 11,237
Reserve for unfunded lending commitments, January 1 1,123 797 777 762 646
Provision for unfunded lending commitments 755 16 20 15 16
Other (5) — — — — 100
Reserve for unfunded lending commitments, December 31 1,878 813 797 777 762
Allowance for credit losses, December 31 $ 20,680 $ 10,229 $ 10,398 $ 11,170 $ 11,999
(1)
On January 1, 2020, the Corporation adopted the CECL accounting standard, which increased the allowance for loan and lease losses by $2.9 billion and the reserve for unfunded lending
commitments by $310 million. For more information, see Note 1 – Summary of Significant Accounting Principles to the Consolidated Financial Statements.
(2)
Represents amounts related to the non-U.S. credit card loan portfolio, which was sold in 2017.
(3)
Includes U.S. small business commercial charge-offs of $321 million, $320 million, $287 million, $258 million and $253 million in 2020, 2019, 2018, 2017 and 2016, respectively.
(4)
Includes U.S. small business commercial recoveries of $54 million, $48 million, $47 million, $43 million and $45 million in 2020, 2019, 2018, 2017 and 2016, respectively.
(5)
Primarily represents write-offs of purchased credit-impaired loans for years prior to 2020, the net impact of portfolio sales, consolidations and deconsolidations, foreign currency translation
adjustments, transfers to held for sale and certain other reclassifications.
(6)
Represents allowance related to the non-U.S. credit card loan portfolio, which was sold in 2017.


02.25.2021 22:54PM 62539
Table V Allowance for Credit Losses (continued)

Loan and allowance ratios (7):
(8)
Loans and leases outstanding at December 31 $921,180 $975,091 $942,546 $931,039 $908,812
Allowance for loan and lease losses as a percentage of total loans and leases outstanding
(8)
at December 31 2.04 % 0.97 % 1.02 % 1.12 % 1.26 %
Consumer allowance for loan and lease losses as a percentage of total consumer loans and
(9)
leases outstanding at December 31 2.35 0.98 1.08 1.18 1.36
Commercial allowance for loan and lease losses as a percentage of total commercial loans
and leases outstanding at December 31 (10) 1.77 0.96 0.97 1.05 1.16
Average loans and leases outstanding (8) $974,281 $951,583 $927,531 $911,988 $892,255
Net charge-offs as a percentage of average loans and leases outstanding (8) 0.42 % 0.38 % 0.41 % 0.44 % 0.43 %
Allowance for loan and lease losses as a percentage of total nonperforming loans and
leases at December 31 380 265 194 161 149
Ratio of the allowance for loan and lease losses at December 31 to net charge-offs 4.56 2.58 2.55 2.61 3.00
Amounts included in allowance for loan and lease losses for loans and leases that are
excluded from nonperforming loans and leases at December 31 (11) $ 9,854 $ 4,151 $ 4,031 $ 3,971 $ 3,951
Allowance for loan and lease losses as a percentage of total nonperforming loans and
leases, excluding the allowance for loan and lease losses for loans and leases that are
excluded from nonperforming loans and leases at December 31 (11) 181 % 148 % 113 % 99 % 98 %
(7)
Loan and allowance ratios for 2016 include $243 million of non-U.S. credit card allowance for loan and lease losses and $9.2 billion of ending non-U.S. credit card loans, which were sold in
2017.
(8)
Outstanding loan and lease balances and ratios do not include loans accounted for under the fair value option of $6.7 billion, $8.3 billion, $4.3 billion, $5.7 billion and $7.1 billion at
December 31, 2020, 2019, 2018, 2017 and 2016, respectively. Average loans accounted for under the fair value option were $8.2 billion, $6.8 billion, $5.5 billion, $6.7 billion and $8.2 billion
in 2020, 2019, 2018, 2017 and 2016, respectively.
(9)
Excludes consumer loans accounted for under the fair value option of $735 million, $594 million, $682 million, $928 million and $1.1 billion at December 31, 2020, 2019, 2018, 2017 and
2016, respectively.
(10)
Excludes commercial loans accounted for under the fair value option of $5.9 billion, $7.7 billion, $3.7 billion, $4.8 billion and $6.0 billion at December 31, 2020, 2019, 2018, 2017 and 2016,
respectively.
(11)
Primarily includes amounts related to credit card and unsecured consumer lending portfolios in Consumer Banking and, in 2017 and 2016, the non-U.S. credit card portfolio in All Other.
Table VI Allocation of the Allowance for Credit Losses by Product Type (1)
December 31
2020 2019 2018 2017 2016
Percent Percent Percent Percent Percent
(Dollars in millions) Amount of Total Amount of Total Amount of Total Amount of Total Amount of Total
Allowance for loan and lease losses
Residential mortgage $ 459 2.44 % $ 325 3.45 % $ 422 4.40 % $ 701 6.74 % $ 1,012 8.82 %
Home equity 399 2.12 221 2.35 506 5.27 1,019 9.80 1,738 15.14
Credit card 8,420 44.79 3,710 39.39 3,597 37.47 3,368 32.41 2,934 25.56
Non-U.S. credit card — — — — — — — — 243 2.12
Direct/Indirect consumer 752 4.00 234 2.49 248 2.58 264 2.54 244 2.13
Other consumer 41 0.22 52 0.55 29 0.30 31 0.30 51 0.44
Total consumer 10,071 53.57 4,542 48.23 4,802 50.02 5,383 51.79 6,222 54.21
U.S. commercial (2) 5,043 26.82 3,015 32.02 3,010 31.35 3,113 29.95 3,326 28.97
Non-U.S. commercial 1,241 6.60 658 6.99 677 7.05 803 7.73 874 7.61
Commercial real estate 2,285 12.15 1,042 11.07 958 9.98 935 9.00 920 8.01
Commercial lease financing 162 0.86 159 1.69 154 1.60 159 1.53 138 1.20
Total commercial 8,731 46.43 4,874 51.77 4,799 49.98 5,010 48.21 5,258 45.79
Total allowance for loan and lease losses 18,802 100.00 % 9,416 100.00 % 9,601 100.00 % 10,393 100.00 % 11,480 100.00 %
Less: Allowance included in assets of
business held for sale (3) — — — — (243)
Allowance for loan and lease losses 18,802 9,416 9,601 10,393 11,237
Reserve for unfunded lending commitments 1,878 813 797 777 762
Allowance for credit losses $ 20,680 $ 10,229 $ 10,398 $ 11,170 $ 11,999
(1)
On January 1, 2020, the Corporation adopted the CECL accounting standard. For more information, see Note 1 – Summary of Significant Accounting Principles to the Consolidated Financial
Statements.
(2)
Includes allowance for loan and lease losses for U.S. small business commercial loans of $1.5 billion, $523 million, $474 million, $439 million and $416 million at December 31, 2020, 2019,
2018, 2017 and 2016, respectively.
(3)
Represents allowance for loan and lease losses related to the non-U.S. credit card loan portfolio, which was sold in 2017.


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Financial Statements and Notes

Table of Contents
Page
Consolidated Statement of Income 120
Consolidated Statement of Comprehensive Income 120
Consolidated Balance Sheet 121
Consolidated Statement of Changes in Shareholders’ Equity 122
Consolidated Statement of Cash Flows 123
Note 1 – Summary of Significant Accounting Principles 124
Note 2 – Net Interest Income and Noninterest Income 133
Note 3 – Derivatives 134
Note 4 – Securities 141
Note 5 – Outstanding Loans and Leases and Allowance for Credit Losses 144
Note 6 – Securitizations and Other Variable Interest Entities 152
Note 7 – Goodwill and Intangible Assets 156
Note 8 – Leases 157
Note 9 – Deposits 157
Note 10 – Federal Funds Sold or Purchased, Securities Financing Agreements, Short-term Borrowings
and Restricted Cash 158
Note 11 – Long-term Debt 160
Note 12 – Commitments and Contingencies 161
Note 13 – Shareholders’ Equity 166
Note 14 – Accumulated Other Comprehensive Income 168
Note 15 – Earnings Per Common Share 168
Note 16 – Regulatory Requirements and Restrictions 169
Note 17 – Employee Benefit Plans 170
Note 18 – Stock-based Compensation Plans 175
Note 19 – Income Taxes 175
Note 20 – Fair Value Measurements 177
Note 21 – Fair Value Option 186
Note 22 – Fair Value of Financial Instruments 188
Note 23 – Business Segment Information 189
Note 24 – Parent Company Information 192
Note 25 – Performance by Geographical Area 194
Glossary 195
Acronyms 197


02.25.2021 22:54PM 62539
Report of Management on Internal Control Over Financial Reporting

Bank of America Corporation and Subsidiaries
The management of Bank of America Corporation is responsible Management assessed the effectiveness of the
for establishing and maintaining adequate internal control over Corporation’s internal control over financial reporting as of
financial reporting. December 31, 2020 based on the framework set forth by the
The Corporation’s internal control over financial reporting is a Committee of Sponsoring Organizations of the Treadway
process designed to provide reasonable assurance regarding Commission in Internal Control – Integrated Framework (2013).
the reliability of financial reporting and the preparation of Based on that assessment, management concluded that, as of
financial statements for external purposes in accordance with December 31, 2020, the Corporation’s internal control over
accounting principles generally accepted in the United States of financial reporting is effective.
America. The Corporation’s internal control over financial The Corporation’s internal control over financial reporting as
reporting includes those policies and procedures that (i) pertain of December 31, 2020 has been audited by
to the maintenance of records that, in reasonable detail, PricewaterhouseCoopers, LLP, an independent registered public
accurately and fairly reflect the transactions and dispositions of accounting firm, as stated in their accompanying report which
the assets of the Corporation; (ii) provide reasonable assurance expresses an unqualified opinion on the effectiveness of the
that transactions are recorded as necessary to permit Corporation’s internal control over financial reporting as of
preparation of financial statements in accordance with December 31, 2020.
accounting principles generally accepted in the United States of
America, and that receipts and expenditures of the Corporation
are being made only in accordance with authorizations of
management and directors of the Corporation; and (iii) provide
reasonable assurance regarding prevention or timely detection
of unauthorized acquisition, use, or disposition of the Brian T. Moynihan
Corporation’s assets that could have a material effect on the Chairman, Chief Executive Officer and President
financial statements.
Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstatements.
Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the
degree of compliance with the policies or procedures may Paul M. Donofrio
deteriorate. Chief Financial Officer


02.25.2021 22:54PM 62539
C M Y K 186 8.000 in x 10.250 in Bank of America
Report of Independent Registered Public Accounting Firm

Bank of America Corporation and Subsidiaries regarding the amounts and disclosures in the consolidated
financial statements. Our audits also included evaluating the
To the Board of Directors and Shareholders of Bank accounting principles used and significant estimates made by
of America Corporation: management, as well as evaluating the overall presentation of
the consolidated financial statements. Our audit of internal
Opinions on the Financial Statements and Internal control over financial reporting included obtaining an
Control over Financial Reporting understanding of internal control over financial reporting,
assessing the risk that a material weakness exists, and testing
We have audited the accompanying consolidated balance
and evaluating the design and operating effectiveness of
sheets of Bank of America Corporation and its subsidiaries (the
internal control based on the assessed risk. Our audits also
“Corporation”) as of December 31, 2020 and 2019, and the
included performing such other procedures as we considered
related consolidated statements of income, comprehensive
necessary in the circumstances. We believe that our audits
income, changes in shareholders’ equity and cash flows for
provide a reasonable basis for our opinions.
each of the three years in the period ended December 31,
2020, including the related notes (collectively referred to as the Definition and Limitations of Internal Control over
“consolidated financial statements”). We also have audited the
Corporation's internal control over financial reporting as of
Financial Reporting
December 31, 2020, based on criteria established in Internal A company’s internal control over financial reporting is a
Control - Integrated Framework (2013) issued by the Committee process designed to provide reasonable assurance regarding
of Sponsoring Organizations of the Treadway Commission the reliability of financial reporting and the preparation of
(COSO). financial statements for external purposes in accordance with
In our opinion, the consolidated financial statements generally accepted accounting principles. A company’s internal
referred to above present fairly, in all material respects, the control over financial reporting includes those policies and
financial position of the Corporation as of December 31, 2020 procedures that (i) pertain to the maintenance of records that, in
and 2019, and the results of its operations and its cash flows reasonable detail, accurately and fairly reflect the transactions
for each of the three years in the period ended December 31, and dispositions of the assets of the company; (ii) provide
2020 in conformity with accounting principles generally reasonable assurance that transactions are recorded as
accepted in the United States of America. Also in our opinion, necessary to permit preparation of financial statements in
the Corporation maintained, in all material respects, effective accordance with generally accepted accounting principles, and
internal control over financial reporting as of December 31, that receipts and expenditures of the company are being made
2020, based on criteria established in Internal Control - only in accordance with authorizations of management and
Integrated Framework (2013) issued by the COSO. directors of the company; and (iii) provide reasonable assurance
regarding prevention or timely detection of unauthorized
Change in Accounting Principle acquisition, use, or disposition of the company’s assets that
As discussed in Note 1 to the consolidated financial could have a material effect on the financial statements.
statements, the Corporation changed the manner in which it Because of its inherent limitations, internal control over
accounts for credit losses on certain financial instruments in financial reporting may not prevent or detect misstatements.
2020. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become
Basis for Opinions inadequate because of changes in conditions, or that the
The Corporation’s management is responsible for these degree of compliance with the policies or procedures may
consolidated financial statements, for maintaining effective deteriorate.
internal control over financial reporting, and for its assessment
of the effectiveness of internal control over financial reporting,
Critical Audit Matters
included in the accompanying Report of Management on Internal The critical audit matters communicated below are matters
Control Over Financial Reporting. Our responsibility is to express arising from the current period audit of the consolidated
opinions on the Corporation’s consolidated financial statements financial statements that were communicated or required to be
and on the Corporation's internal control over financial reporting communicated to the audit committee and that (i) relate to
based on our audits. We are a public accounting firm registered accounts or disclosures that are material to the consolidated
with the Public Company Accounting Oversight Board (United financial statements and (ii) involved our especially challenging,
States) (PCAOB) and are required to be independent with subjective, or complex judgments. The communication of critical
respect to the Corporation in accordance with the U.S. federal audit matters does not alter in any way our opinion on the
securities laws and the applicable rules and regulations of the consolidated financial statements, taken as a whole, and we
Securities and Exchange Commission and the PCAOB. are not, by communicating the critical audit matters below,
We conducted our audits in accordance with the standards providing separate opinions on the critical audit matters or on
of the PCAOB. Those standards require that we plan and the accounts or disclosures to which they relate.
perform the audits to obtain reasonable assurance about Allowance for Loan and Lease Losses - Commercial and
whether the consolidated financial statements are free of
material misstatement, whether due to error or fraud, and
Consumer Card Loans
whether effective internal control over financial reporting was As described in Notes 1 and 5 to the consolidated financial
statements, the allowance for loan and lease losses represents
maintained in all material respects. Our audits of the

consolidated financial statements included performing management’s estimate of the expected credit losses in the
procedures to assess the risks of material misstatement of the Corporation’s loan and lease portfolio, excluding loans and
consolidated financial statements, whether due to error or unfunded lending commitments accounted for under the fair
fraud, and performing procedures that respond to those risks. value option. As of December 31, 2020, the allowance for loan
Such procedures included examining, on a test basis, evidence and lease losses was $18.8 billion on total loans and leases of


02.25.2021 22:54PM 62539
$921.2 billion, which excludes loans accounted for under the also included the involvement of professionals with specialized
fair value option. For commercial and consumer card loans, the skill and knowledge to assist in evaluating the appropriateness
expected credit loss is estimated using quantitative methods of certain loss forecast models, the reasonableness of
that consider a variety of factors such as historical loss economic forecast scenarios and related weightings and the
experience, the current credit quality of the portfolio as well as reasonableness of certain qualitative reserves.
an economic outlook over the life of the loan. In its loss
forecasting framework, the Corporation incorporates forward Valuation of Certain Level 3 Financial Instruments
looking information through the use of macroeconomic As described in Notes 1 and 20 to the consolidated financial
scenarios applied over the forecasted life of the assets. These statements, the Corporation carries certain financial
macroeconomic scenarios include variables that have instruments at fair value, which includes $10.0 billion of assets
historically been key drivers of increases and decreases in and $7.4 billion of liabilities classified as Level 3 fair value
credit losses. These variables include, but are not limited to, measurements on a recurring basis and $1.7 billion of assets
unemployment rates, real estate prices, gross domestic product classified as Level 3 fair value measurements on a nonrecurring
levels and corporate bond spreads. The scenarios that are basis, for which the determination of fair value requires
chosen and the amount of weighting given to each scenario significant management judgment or estimation. The
depend on a variety of factors including recent economic events, Corporation determines the fair value of Level 3 financial
leading economic indicators, views of internal as well as third- instruments using pricing models, discounted cash flow
party economists and industry trends. Also included in the methodologies, or similar techniques that require inputs that
allowance for loan losses are qualitative reserves to cover are both unobservable and are significant to the overall fair
losses that are expected but, in the Corporation's assessment, value measurement. Unobservable inputs, such as volatility or
may not be adequately reflected in the quantitative methods or price, may be determined using quantitative-based
the economic assumptions. Factors that the Corporation extrapolations or other internal methodologies which incorporate
considers include changes in lending policies and procedures, management estimates and available market information.
business conditions, the nature and size of the portfolio, The principal considerations for our determination that
portfolio concentrations, the volume and severity of past due performing procedures relating to the valuation of certain Level
loans and nonaccrual loans, the effect of external factors such 3 financial instruments is a critical audit matter are the
as competition, and legal and regulatory requirements, among significant judgment and estimation used by management to
others. Further, the Corporation considers the inherent determine the fair value of these financial instruments, which in
uncertainty in quantitative models that are built on historical turn led to a high degree of auditor judgment and effort in
data. performing procedures, including the involvement of
The principal considerations for our determination that professionals with specialized skill and knowledge to assist in
performing procedures relating to the allowance for loan and evaluating certain audit evidence.
lease losses for the commercial and consumer card portfolios is Addressing the matter involved performing procedures and
a critical audit matter are (i) the significant judgment and evaluating audit evidence in connection with forming our overall
estimation by management in developing lifetime economic opinion on the consolidated financial statements. These
forecast scenarios, related weightings to each scenario and procedures included testing the effectiveness of controls
certain qualitative reserves, which in turn led to a high degree of relating to the valuation of financial instruments, including
auditor judgment, subjectivity and effort in performing controls related to valuation models, significant unobservable
procedures and in evaluating audit evidence obtained, and (ii) inputs, and data. These procedures also included, among
the audit effort involved professionals with specialized skill and others, the involvement of professionals with specialized skill
knowledge to assist in evaluating certain audit evidence. and knowledge to assist in developing an independent estimate
Addressing the matter involved performing procedures and of fair value for a sample of these certain financial instruments
evaluating audit evidence in connection with forming our overall and comparison of management’s estimate to the
opinion on the consolidated financial statements. These independently developed estimate of fair value. Developing the
procedures included testing the effectiveness of controls independent estimate involved testing the completeness and
relating to the allowance for loan and lease losses, including accuracy of data provided by management and evaluating the
controls over the evaluation and approval of models, forecast reasonableness of management’s assumptions used to develop
scenarios and related weightings, and qualitative reserves. the significant unobservable inputs.
These procedures also included, among others, testing
management’s process for estimating the allowance for loan
losses, including (i) evaluating the appropriateness of the loss
forecast models and methodology, (ii) evaluating the
reasonableness of certain macroeconomic variables, (iii)
evaluating the reasonableness of management’s development, Charlotte, North Carolina
selection and weighting of economic forecast scenarios used in February 24, 2021
the loss forecast models, (iv) testing the completeness and
accuracy of data used in the estimate, and (v) evaluating certain
qualitative reserves made to the model output results to We have served as the Corporation’s auditor since 1958.
determine the overall allowance for loan losses. The procedures


02.25.2021 22:54PM 62539
C M Y K 8.000 in x 10.250 in Bank of America
Consolidated Statement of Income

(In millions, except per share information) 2020 2019 2018
Net interest income
Interest income $ 51,585 $ 71,236 $ 66,769
Interest expense 8,225 22,345 18,607
Net interest income 43,360 48,891 48,162
Noninterest income
Fees and commissions 34,551 33,015 33,078
Market making and similar activities 8,355 9,034 9,008
Other income (738) 304 772
Total noninterest income 42,168 42,353 42,858
Total revenue, net of interest expense 85,528 91,244 91,020
Provision for credit losses 11,320 3,590 3,282
Noninterest expense
Compensation and benefits 32,725 31,977 31,880
Occupancy and equipment 7,141 6,588 6,380
Information processing and communications 5,222 4,646 4,555
Product delivery and transaction related 3,433 2,762 2,857
Marketing 1,701 1,934 1,674
Professional fees 1,694 1,597 1,699
Other general operating 3,297 5,396 4,109
Total noninterest expense 55,213 54,900 53,154
Income before income taxes 18,995 32,754 34,584
Income tax expense 1,101 5,324 6,437
Net income $ 17,894 $ 27,430 $ 28,147
Preferred stock dividends 1,421 1,432 1,451
Net income applicable to common shareholders $ 16,473 $ 25,998 $ 26,696
Per common share information

Earnings $ 1.88 $ 2.77 $ 2.64
Diluted earnings 1.87 2.75 2.61
Average common shares issued and outstanding 8,753.2 9,390.5 10,096.5
Average diluted common shares issued and outstanding 8,796.9 9,442.9 10,236.9
Consolidated Statement of Comprehensive Income

Net income $ 17,894 $ 27,430 $ 28,147
Other comprehensive income (loss), net-of-tax:
Net change in debt securities 4,799 5,875 (3,953)
Net change in debit valuation adjustments (498) (963) 749
Net change in derivatives 826 616 (53)
Employee benefit plan adjustments (98) 136 (405)
Net change in foreign currency translation adjustments (52) (86) (254)
Other comprehensive income (loss) 4,977 5,578 (3,916)
Comprehensive income $ 22,871 $ 33,008 $ 24,231
See accompanying Notes to Consolidated Financial Statements.


02.25.2021 22:54PM 62539
Consolidated Balance Sheet

December 31
Assets
Cash and due from banks $ 36,430 $ 30,152
Interest-bearing deposits with the Federal Reserve, non-U.S. central banks and other banks 344,033 131,408
Cash and cash equivalents 380,463 161,560
Time deposits placed and other short-term investments 6,546 7,107
Federal funds sold and securities borrowed or purchased under agreements to resell
(includes $108,856 and $50,364 measured at fair value) 304,058 274,597
Trading account assets (includes $91,510 and $90,946 pledged as collateral) 198,854 229,826
Derivative assets 47,179 40,485
Debt securities:
Carried at fair value 246,601 256,467
Held-to-maturity, at cost (fair value – $448,180 and $219,821) 438,249 215,730
Total debt securities 684,850 472,197
Loans and leases (includes $6,681 and $8,335 measured at fair value) 927,861 983,426
Allowance for loan and lease losses (18,802) (9,416)
Loans and leases, net of allowance 909,059 974,010
Premises and equipment, net 11,000 10,561
Goodwill 68,951 68,951
Loans held-for-sale (includes $1,585 and $3,709 measured at fair value) 9,243 9,158
Customer and other receivables 64,221 55,937
Other assets (includes $15,718 and $15,518 measured at fair value) 135,203 129,690
Total assets $ 2,819,627 $ 2,434,079
Liabilities
Deposits in U.S. offices:
Noninterest-bearing $ 650,674 $ 403,305
Interest-bearing (includes $481 and $508 measured at fair value) 1,038,341 940,731
Deposits in non-U.S. offices:
Noninterest-bearing 17,698 13,719
Interest-bearing 88,767 77,048
Total deposits 1,795,480 1,434,803
Federal funds purchased and securities loaned or sold under agreements to repurchase
(includes $135,391 and $16,008 measured at fair value) 170,323 165,109
Trading account liabilities 71,320 83,270
Derivative liabilities 45,526 38,229
Short-term borrowings (includes $5,874 and $3,941 measured at fair value) 19,321 24,204
Accrued expenses and other liabilities (includes $16,311 and $15,434 measured at fair value
and $1,878 and $813 of reserve for unfunded lending commitments) 181,799 182,798
Long-term debt (includes $32,200 and $34,975 measured at fair value) 262,934 240,856
Total liabilities 2,546,703 2,169,269
Commitments and contingencies (Note 6 – Securitizations and Other Variable Interest Entities
and Note 12 – Commitments and Contingencies)
Shareholders’ equity
Preferred stock, $0.01 par value; authorized – 100,000,000 shares; issued and outstanding – 3,931,440 and 3,887,440 shares 24,510 23,401
Common stock and additional paid-in capital, $0.01 par value; authorized – 12,800,000,000 shares;
issued and outstanding – 8,650,814,105 and 8,836,148,954 shares 85,982 91,723
Retained earnings 164,088 156,319
Accumulated other comprehensive income (loss) (1,656) (6,633)
Total shareholders’ equity 272,924 264,810
Total liabilities and shareholders’ equity $ 2,819,627 $ 2,434,079
Assets of consolidated variable interest entities included in total assets above (isolated to settle the liabilities of the variable interest entities)
Trading account assets $ 5,225 $ 5,811
Loans and leases 23,636 38,837
Allowance for loan and lease losses (1,693) (807)
Loans and leases, net of allowance 21,943 38,030
All other assets 1,387 540
Total assets of consolidated variable interest entities $ 28,555 $ 44,381
Liabilities of consolidated variable interest entities included in total liabilities above
Short-term borrowings (includes $22 and $0 of non-recourse short-term borrowings) $ 454 $ 2,175
Long-term debt (includes $7,053 and $8,717 of non-recourse debt) 7,053 8,718
All other liabilities (includes $16 and $19 of non-recourse liabilities) 16 22

Total liabilities of consolidated variable interest entities $ 7,523 $ 10,915


02.25.2021 22:54PM 62539
Bank
Bank
Bankof
of
ofAmerica
America
AmericaCorporation
Corporation
Corporationand
and
andSubsidiaries
Subsidiaries
Subsidiaries
Consolidated
Consolidated Statement
Statement of
of Changes
Changes in
in Shareholders’
Shareholders’ Equity
Equity
Accumulated
Common Stock and Other Total
Preferred Additional Paid-in Capital Retained Comprehensive Shareholders’
(In millions) Stock Shares Amount Earnings Income (Loss) Equity
Balance, December 31, 2017 $ 22,323 10,287.3 $ 138,089 $ 113,816 $ (7,082) $ 267,146
Cumulative adjustment for adoption of hedge accounting
standard (32) 57 25
Adoption of accounting standard related to certain tax effects
stranded in accumulated other comprehensive income (loss) 1,270 (1,270) —
Net income 28,147 28,147
Net change in debt securities (3,953) (3,953)
Net change in debit valuation adjustments 749 749
Net change in derivatives (53) (53)
Employee benefit plan adjustments (405) (405)
Net change in foreign currency translation adjustments (254) (254)
Dividends declared:
Common (5,424) (5,424)
Preferred (1,451) (1,451)
Issuance of preferred stock 4,515 4,515
Redemption of preferred stock (4,512) (4,512)
Common stock issued under employee plans, net, and other 58.2 901 (12) 889
Common stock repurchased (676.2) (20,094) (20,094)
Cumulative adjustment for adoption of lease accounting
standard 165 165
Net income 27,430 27,430
Net change in debt securities 5,875 5,875
Net change in debit valuation adjustments (963) (963)
Net change in derivatives 616 616
Employee benefit plan adjustments 136 136
Dividends declared:
Common (6,146) (6,146)
Preferred (1,432) (1,432)
Common stock issued under employee plans, net, and other 123.3 971 (12) 959
Cumulative adjustment for adoption of credit loss accounting
standard (2,406) (2,406)
Net income 17,894 17,894
Net change in debt securities 4,799 4,799
Net change in debit valuation adjustments (498) (498)
Net change in derivatives 826 826
Employee benefit plan adjustments (98) (98)
Dividends declared:
Common (6,289) (6,289)
Preferred (1,421) (1,421)
Common stock issued under employee plans, net, and other 41.7 1,284 (9) 1,275
See
Seeaccompanying
accompanyingNotes
Notesto
toConsolidated
ConsolidatedFinancial
FinancialStatements.
Statements.

122
122 Bank
BankofofAmerica
America2020
2020

02.26.2021 18:55PM 62539
Bank
Bank of
of America
America Corporation
Corporation and
and Subsidiaries
Subsidiaries
Consolidated
Consolidated Statement
Statement of
of Cash
Cash Flows
Flows

Operating activities
Net income $ 17,894 $ 27,430 $ 28,147
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses 11,320 3,590 3,282
Gains on sales of debt securities (411) (217) (154)
Depreciation and amortization 1,843 1,729 2,063
Net amortization of premium/discount on debt securities 4,101 2,066 1,824
Deferred income taxes (1,737) 2,435 3,041
Stock-based compensation 2,031 1,974 1,729
Impairment of equity method investment — 2,072 —
Loans held-for-sale:
Originations and purchases (19,657) (28,874) (28,071)
Proceeds from sales and paydowns of loans originally classified as held for sale and instruments
from related securitization activities 19,049 30,191 28,972
Net change in:
Trading and derivative assets/liabilities 16,942 7,920 (23,673)
Other assets (12,883) (11,113) 11,920
Accrued expenses and other liabilities (4,385) 16,363 13,010
Other operating activities, net 3,886 6,211 (2,570)
Net cash provided by operating activities 37,993 61,777 39,520
Investing activities
Net change in:
Time deposits placed and other short-term investments 561 387 3,659
Federal funds sold and securities borrowed or purchased under agreements to resell (29,461) (13,466) (48,384)
Debt securities carried at fair value:
Proceeds from sales 77,524 52,006 5,117
Proceeds from paydowns and maturities 91,084 79,114 78,513
Purchases (194,877) (152,782) (76,640)
Held-to-maturity debt securities:
Proceeds from paydowns and maturities 93,835 34,770 18,789
Purchases (257,535) (37,115) (35,980)
Loans and leases:
Proceeds from sales of loans originally classified as held for investment and instruments
from related securitization activities 13,351 12,201 21,365
Purchases (5,229) (5,963) (4,629)
Other changes in loans and leases, net 36,571 (46,808) (31,292)
Other investing activities, net (3,489) (2,974) (1,986)
Net cash used in investing activities (177,665) (80,630) (71,468)
Financing activities
Net change in:
Deposits 360,677 53,327 71,931
Federal funds purchased and securities loaned or sold under agreements to repurchase 5,214 (21,879) 10,070
Short-term borrowings (4,893) 4,004 (12,478)
Long-term debt:
Proceeds from issuance 57,013 52,420 64,278
Retirement (47,948) (50,794) (53,046)
Preferred stock:
Proceeds from issuance 2,181 3,643 4,515
Redemption (1,072) (2,568) (4,512)
Common stock repurchased (7,025) (28,144) (20,094)
Cash dividends paid (7,727) (5,934) (6,895)
Other financing activities, net (601) (698) (651)
Net cash provided by financing activities 355,819 3,377 53,118
Effect of exchange rate changes on cash and cash equivalents 2,756 (368) (1,200)
Net increase (decrease) in cash and cash equivalents 218,903 (15,844) 19,970
Cash and cash equivalents at January 1 161,560 177,404 157,434
Cash and cash equivalents at December 31 $ 380,463 $ 161,560 $ 177,404
Supplemental cash flow disclosures
Interest paid $ 8,662 $ 22,196 $ 19,087
Income taxes paid, net 2,894 4,359 2,470
See
Seeaccompanying
accompanyingNotes
NotestotoConsolidated
ConsolidatedFinancial
FinancialStatements.
Statements.

122 Bank of America 2020 Bank of America 2020 123

02.26.2021 18:55PM 62539
Bank of America Corporation and Subsidiaries relationships and other transactions affected by reference rate
reform. The Corporation has elected to retrospectively adopt the
Notes to Consolidated Financial Statements
new standard as of January 1, 2020. The adoption did not have
NOTE 1 Summary of Significant Accounting a material accounting impact on the Corporation’s consolidated
financial position or results of operations; however, it did ease
Principles the administrative burden in accounting for certain effects of
Bank of America Corporation, a bank holding company and a reference rate reform.
financial holding company, provides a diverse range of financial
services and products throughout the U.S. and in certain Significant Accounting Principles
international markets. The term “the Corporation” as used
herein may refer to Bank of America Corporation, individually, Cash and Cash Equivalents
Bank of America Corporation and its subsidiaries, or certain of Cash and cash equivalents include cash on hand, cash items in
Bank of America Corporation’s subsidiaries or affiliates. the process of collection, cash segregated under federal and
other brokerage regulations, and amounts due from
Principles of Consolidation and Basis of Presentation correspondent banks, the Federal Reserve Bank and certain
The Consolidated Financial Statements include the accounts of non-U.S. central banks. Certain cash balances are restricted as
the Corporation and its majority-owned subsidiaries and those to withdrawal or usage by legally binding contractual agreements
variable interest entities (VIEs) where the Corporation is the or regulatory requirements.
primary beneficiary. Intercompany accounts and transactions
have been eliminated. Results of operations of acquired Securities Financing Agreements
companies are included from the dates of acquisition, and for Securities borrowed or purchased under agreements to resell
VIEs, from the dates that the Corporation became the primary and securities loaned or sold under agreements to repurchase
beneficiary. Assets held in an agency or fiduciary capacity are (securities financing agreements) are treated as collateralized
not included in the Consolidated Financial Statements. The financing transactions except in instances where the transaction
Corporation accounts for investments in companies for which it is required to be accounted for as individual sale and purchase
owns a voting interest and for which it has the ability to exercise transactions. Generally, these agreements are recorded at
significant influence over operating and financing decisions acquisition or sale price plus accrued interest, except for
using the equity method of accounting. These investments are securities financing agreements that the Corporation accounts
included in other assets. Equity method investments are subject for under the fair value option. Changes in the fair value of
to impairment testing, and the Corporation’s proportionate securities financing agreements that are accounted for under
share of income or loss is included in other income. the fair value option are recorded in market making and similar
The preparation of the Consolidated Financial Statements in activities in the Consolidated Statement of Income.
conformity with accounting principles generally accepted in the The Corporation’s policy is to monitor the market value of
United States of America requires management to make the principal amount loaned under resale agreements and
estimates and assumptions that affect reported amounts and obtain collateral from or return collateral pledged to
disclosures. Actual results could materially differ from those counterparties when appropriate. Securities financing
estimates and assumptions. Certain prior-period amounts have agreements do not create material credit risk due to these
been reclassified to conform to current period presentation. collateral provisions; therefore, an allowance for loan losses is
not necessary.
New Accounting Standards In transactions where the Corporation acts as the lender in a
securities lending agreement and receives securities that can
Accounting for Financial Instruments -- Credit Losses be pledged or sold as collateral, it recognizes an asset on the
On January 1, 2020, the Corporation adopted the new Consolidated Balance Sheet at fair value, representing the
accounting standard that requires the measurement of the securities received, and a liability, representing the obligation to
allowance for credit losses to be based on management’s best return those securities.
estimate of lifetime expected credit losses (ECL) inherent in the
Corporation’s relevant financial assets. Upon adoption of the Collateral
standard on January 1, 2020, the Corporation recorded a $3.3 The Corporation accepts securities and loans as collateral that
billion, or 32 percent, increase to the allowance for credit it is permitted by contract or practice to sell or repledge. At
losses. After adjusting for deferred taxes and other adoption December 31, 2020 and 2019, the fair value of this collateral
effects, a $2.4 billion decrease was recorded in retained was $812.4 billion and $693.0 billion, of which $758.5 billion
earnings through a cumulative-effect adjustment. Prior to and $593.8 billion were sold or repledged. The primary source
January 1, 2020, the allowance for credit losses was of this collateral is securities borrowed or purchased under
determined based on management’s estimate of probable agreements to resell.
incurred losses. The Corporation also pledges company-owned securities and
loans as collateral in transactions that include repurchase
Reference Rate Reform agreements, securities loaned, public and trust deposits, U.S.
The Financial Accounting Standards Board (FASB) issued a new Treasury tax and loan notes, and short-term borrowings. This
accounting standard in March 2020, which was subsequently collateral, which in some cases can be sold or repledged by the
amended in January 2021, related to contracts or hedging counterparties to the transactions, is parenthetically disclosed
relationships that reference London Interbank Offered Rate on the Consolidated Balance Sheet.
(LIBOR) or other reference rates that are expected to be In certain cases, the Corporation has transferred assets to
discontinued due to reference rate reform. The new standard consolidated VIEs where those restricted assets serve as
provides for optional expedients and other guidance regarding collateral for the interests issued by the VIEs. These assets are
the accounting related to modifications of contracts, hedging included on the Consolidated Balance Sheet in Assets of
Consolidated VIEs.

02.25.2021 22:55PM 62539
In addition, the Corporation obtains collateral in connection the effect of measuring the derivative instrument and the asset
with its derivative contracts. Required collateral levels vary or liability to which the risk exposure pertains will offset in the
depending on the credit risk rating and the type of counterparty. Consolidated Statement of Income to the extent effective. The
Generally, the Corporation accepts collateral in the form of changes in the fair value of derivatives that serve to mitigate
cash, U.S. Treasury securities and other marketable securities. certain risks associated with mortgage servicing rights (MSRs),
Based on provisions contained in master netting agreements, interest rate lock commitments (IRLCs) and first-lien mortgage
the Corporation nets cash collateral received against derivative loans held-for-sale (LHFS) that are originated by the Corporation
assets. The Corporation also pledges collateral on its own are recorded in other income. Changes in the fair value of
derivative positions which can be applied against derivative derivatives that serve to mitigate interest rate risk and foreign
liabilities. currency risk are included in market making and similar
activities. Credit derivatives are also used by the Corporation to
Trading Instruments mitigate the risk associated with various credit exposures. The
Financial instruments utilized in trading activities are carried at changes in the fair value of these derivatives are included in
fair value. Fair value is generally based on quoted market prices market making and similar activities and other income.
for the same or similar assets and liabilities. If these market
prices are not available, fair values are estimated based on Derivatives Used For Hedge Accounting Purposes
dealer quotes, pricing models, discounted cash flow (Accounting Hedges)
methodologies, or similar techniques where the determination For accounting hedges, the Corporation formally documents at
of fair value may require significant management judgment or inception all relationships between hedging instruments and
estimation. Realized gains and losses are recorded on a trade- hedged items, as well as the risk management objectives and
date basis. Realized and unrealized gains and losses are strategies for undertaking various accounting hedges.
recognized in market making and similar activities. Additionally, the Corporation primarily uses regression analysis
at the inception of a hedge and for each reporting period
Derivatives and Hedging Activities thereafter to assess whether the derivative used in an
Derivatives are entered into on behalf of customers, for trading accounting hedge transaction is expected to be and has been
or to support risk management activities. Derivatives used in highly effective in offsetting changes in the fair value or cash
risk management activities include derivatives that are both flows of a hedged item or forecasted transaction. The
designated in qualifying accounting hedge relationships and Corporation discontinues hedge accounting when it is
derivatives used to hedge market risks in relationships that are determined that a derivative is not expected to be or has
not designated in qualifying accounting hedge relationships ceased to be highly effective as a hedge, and then reflects
(referred to as other risk management activities). The changes in fair value of the derivative in earnings after
Corporation manages interest rate and foreign currency termination of the hedge relationship.
exchange rate sensitivity predominantly through the use of Fair value hedges are used to protect against changes in the
derivatives. Derivatives utilized by the Corporation include fair value of the Corporation’s assets and liabilities that are
swaps, futures and forward settlement contracts, and option attributable to interest rate or foreign exchange volatility.
contracts. Changes in the fair value of derivatives designated as fair value
All derivatives are recorded on the Consolidated Balance hedges are recorded in earnings, together and in the same
Sheet at fair value, taking into consideration the effects of income statement line item with changes in the fair value of the
legally enforceable master netting agreements that allow the related hedged item. If a derivative instrument in a fair value
Corporation to settle positive and negative positions and offset hedge is terminated or the hedge designation removed, the
cash collateral held with the same counterparty on a net basis. previous adjustments to the carrying value of the hedged asset
For exchange-traded contracts, fair value is based on quoted or liability are subsequently accounted for in the same manner
market prices in active or inactive markets or is derived from as other components of the carrying value of that asset or
observable market-based pricing parameters, similar to those liability. For interest-earning assets and interest-bearing
applied to over-the-counter (OTC) derivatives. For non-exchange liabilities, such adjustments are amortized to earnings over the
traded contracts, fair value is based on dealer quotes, pricing remaining life of the respective asset or liability.
models, discounted cash flow methodologies or similar Cash flow hedges are used primarily to minimize the
techniques for which the determination of fair value may require variability in cash flows of assets and liabilities or forecasted
significant management judgment or estimation. transactions caused by interest rate or foreign exchange rate
Valuations of derivative assets and liabilities reflect the fluctuations. The Corporation also uses cash flow hedges to
value of the instrument including counterparty credit risk. These hedge the price risk associated with deferred compensation.
values also take into account the Corporation’s own credit Changes in the fair value of derivatives used in cash flow
standing. hedges are recorded in accumulated other comprehensive
Trading Derivatives and Other Risk Management Activities income (OCI) and are reclassified into the line item in the
income statement in which the hedged item is recorded in the
Derivatives held for trading purposes are included in derivative
same period the hedged item affects earnings. Components of
assets or derivative liabilities on the Consolidated Balance
a derivative that are excluded in assessing hedge effectiveness
Sheet with changes in fair value included in market making and
are recorded in the same income statement line item as the
similar activities.
hedged item.
Derivatives used for other risk management activities are
Net investment hedges are used to manage the foreign
included in derivative assets or derivative liabilities. Derivatives

exchange rate sensitivity arising from a net investment in a
used in other risk management activities have not been
foreign operation. Changes in the spot prices of derivatives that
designated in qualifying accounting hedge relationships because
are designated as net investment hedges of foreign operations
they did not qualify or the risk that is being mitigated pertains to
are recorded as a component of accumulated OCI. The
an item that is reported at fair value through earnings so that
remaining components of these derivatives are excluded in


02.25.2021 22:55PM 62539
assessing hedge effectiveness and are recorded in market Equity securities with readily determinable fair values that
making and similar activities. are not held for trading purposes are carried at fair value with
unrealized gains and losses included in other income. Equity
Securities securities that do not have readily determinable fair values are
Debt securities are reported on the Consolidated Balance Sheet recorded at cost less impairment, if any, plus or minus
at their trade date. Their classification is dependent on the qualifying observable price changes. These securities are
purpose for which the securities were acquired. Debt securities reported in other assets.
purchased for use in the Corporation’s trading activities are
reported in trading account assets at fair value with unrealized Loans and Leases
gains and losses included in market making and similar Loans, with the exception of loans accounted for under the fair
activities. Substantially all other debt securities purchased are value option, are measured at historical cost and reported at
used in the Corporation’s asset and liability management (ALM) their outstanding principal balances net of any unearned
activities and are reported on the Consolidated Balance Sheet income, charge-offs, unamortized deferred fees and costs on
as either debt securities carried at fair value or as held-to- originated loans, and for purchased loans, net of any
maturity (HTM) debt securities. Debt securities carried at fair unamortized premiums or discounts. Loan origination fees and
value are either available-for-sale (AFS) securities with certain direct origination costs are deferred and recognized as
unrealized gains and losses net-of-tax included in accumulated adjustments to interest income over the lives of the related
OCI or carried at fair value with unrealized gains and losses loans. Unearned income, discounts and premiums are
reported in market making and similar activities. HTM debt amortized to interest income using a level yield methodology.
securities are debt securities that management has the intent The Corporation elects to account for certain consumer and
and ability to hold to maturity and are reported at amortized commercial loans under the fair value option with interest
cost. reported in interest income and changes in fair value reported in
The Corporation evaluates each AFS security where the value market making and similar activities or other income.
has declined below amortized cost. If the Corporation intends to Under applicable accounting guidance, for reporting
sell or believes it is more likely than not that it will be required purposes, the loan and lease portfolio is categorized by portfolio
to sell the debt security, it is written down to fair value through segment and, within each portfolio segment, by class of
earnings. For AFS debt securities the Corporation intends to financing receivables. A portfolio segment is defined as the level
hold, the Corporation evaluates the debt securities for ECL at which an entity develops and documents a systematic
except for debt securities that are guaranteed by the U.S. methodology to determine the allowance for credit losses, and a
Treasury, U.S. government agencies or sovereign entities of high class of financing receivables is defined as the level of
credit quality where the Corporation applies a zero credit loss disaggregation of portfolio segments based on the initial
assumption. For the remaining AFS debt securities, the measurement attribute, risk characteristics and methods for
Corporation considers qualitative parameters such as internal assessing risk. The Corporation’s three portfolio segments are
and external credit ratings and the value of underlying collateral. Consumer Real Estate, Credit Card and Other Consumer, and
If an AFS debt security fails any of the qualitative parameters, a Commercial. The classes within the Consumer Real Estate
discounted cash flow analysis is used by the Corporation to portfolio segment are residential mortgage and home equity.
determine if a portion of the unrealized loss is a result of an The classes within the Credit Card and Other Consumer portfolio
expected credit loss. The Corporation will then recognize either segment are credit card, direct/indirect consumer and other
credit loss expense or a reversal of credit loss expense in other consumer. The classes within the Commercial portfolio segment
income for the amount necessary to adjust the debt securities are U.S. commercial, non-U.S. commercial, commercial real
valuation allowance to its current estimate of excepted credit estate, commercial lease financing and U.S. small business
losses. Cash flows expected to be collected are estimated commercial.
using all relevant information available such as remaining
payment terms, prepayment speeds, the financial condition of Leases
the issuer, expected defaults and the value of the underlying The Corporation provides equipment financing to its customers
collateral. If any of the decline in fair value is related to market through a variety of lessor arrangements. Direct financing
factors, that amount is recognized in accumulated OCI. In leases and sales-type leases are carried at the aggregate of
certain instances, the credit loss may exceed the total decline lease payments receivable plus the estimated residual value of
in fair value, in which case, the allowance recorded is limited to the leased property less unearned income, which is accreted to
the difference between the amortized cost and the fair value of interest income over the lease terms using methods that
the asset. approximate the interest method. Operating lease income is
The Corporation separately evaluates its HTM debt securities recognized on a straight-line basis. The Corporation's lease
for any credit losses, of which substantially all qualify for the arrangements generally do not contain non-lease components.
zero loss assumption. For the remaining securities, the
Allowance for Credit Losses
Corporation performs a discounted cash flow analysis to
The allowance for credit losses includes both the allowance for
estimate any credit losses which are then recognized as part of
loan and lease losses and the reserve for unfunded lending
the allowance for credit losses.
commitments and represents management’s estimate of the
Interest on debt securities, including amortization of
ECL in the Corporation’s loan and lease portfolio, excluding
premiums and accretion of discounts, is included in interest
loans and unfunded lending commitments accounted for under
income. Premiums and discounts are amortized or accreted to
the fair value option. The ECL on funded consumer and

interest income at a constant effective yield over the contractual
commercial loans and leases is referred to as the allowance for
lives of the securities. Realized gains and losses from the sales
loan and lease losses and is reported separately as a contra-
of debt securities are determined using the specific
asset to loans and leases on the Consolidated Balance Sheet.
identification method.
The ECL for unfunded lending commitments, including home


02.25.2021 22:55PM 62539
equity lines of credit (HELOCs), standby letters of credit (SBLCs) others. Further, the Corporation considers the inherent
and binding unfunded loan commitments is reported on the uncertainty in quantitative models that are built on historical
Consolidated Balance Sheet in accrued expenses and other data.
liabilities. The provision for credit losses related to the loan and With the exception of the Corporation's credit card portfolio,
lease portfolio and unfunded lending commitments is reported the Corporation does not include reserves for interest receivable
in the Consolidated Statement of Income. in the measurement of the allowance for credit losses as the
For loans and leases, the ECL is typically estimated using Corporation generally classifies consumer loans as
quantitative methods that consider a variety of factors such as nonperforming at 90 days past due and reverses interest
historical loss experience, the current credit quality of the income for these loans at that time. For credit card loans, the
portfolio as well as an economic outlook over the life of the Corporation reserves for interest and fees as part of the
loan. The life of the loan for closed-ended products is based on allowance for loan and lease losses. Upon charge-off of a credit
the contractual maturity of the loan adjusted for any expected card loan, the Corporation reverses the interest and fee income
prepayments. The contractual maturity includes any extension against the income statement line item where it was originally
options that are at the sole discretion of the borrower. For open- recorded.
ended products (e.g., lines of credit), the ECL is determined The Corporation has identified the following three portfolio
based on the maximum repayment term associated with future segments and measures the allowance for credit losses using
draws from credit lines unless those lines of credit are the following methods.
unconditionally cancellable (e.g., credit cards) in which case the
Corporation does not record any allowance. Consumer Real Estate
In its loss forecasting framework, the Corporation To estimate ECL for consumer loans secured by residential real
incorporates forward-looking information through the use of estate, the Corporation estimates the number of loans that will
macroeconomic scenarios applied over the forecasted life of the default over the life of the existing portfolio, after factoring in
assets. These macroeconomic scenarios include variables that estimated prepayments, using quantitative modeling
have historically been key drivers of increases and decreases in methodologies. The attributes that are most significant in
credit losses. These variables include, but are not limited to, estimating the Corporation’s ECL include refreshed loan-to-value
unemployment rates, real estate prices, gross domestic product (LTV) or, in the case of a subordinated lien, refreshed combined
levels and corporate bond spreads. As any one economic LTV (CLTV), borrower credit score, months since origination and
outlook is inherently uncertain, the Corporation leverages geography, all of which are further broken down by present
multiple scenarios. The scenarios that are chosen each quarter collection status (whether the loan is current, delinquent, in
and the weighting given to each scenario depend on a variety of default, or in bankruptcy). The estimates are based on the
factors including recent economic events, leading economic Corporation’s historical experience with the loan portfolio,
indicators, views of internal and third-party economists and adjusted to reflect the economic outlook. The outlook on the
industry trends. unemployment rate and consumer real estate prices are key
The estimate of credit losses includes expected recoveries factors that impact the frequency and severity of loss estimates.
of amounts previously charged off (i.e., negative allowance). If a The Corporation does not reserve for credit losses on the
loan has been charged off, the expected cash flows on the loan unpaid principal balance of loans insured by the Federal
are not limited by the current amortized cost balance. Instead, Housing Administration (FHA) and long-term standby loans, as
expected cash flows can be assumed up to the unpaid principal these loans are fully insured. The Corporation records a reserve
balance immediately prior to the charge-off. for unfunded lending commitments for the ECL associated with
The allowance for loan and lease losses for troubled debt the undrawn portion of the Corporation’s HELOCs, which can
restructurings (TDR) is measured based on the present value of only be canceled by the Corporation if certain criteria are met.
projected future lifetime principal and interest cash flows The ECL associated with these unfunded lending commitments
discounted at the loan’s original effective interest rate, or in is calculated using the same models and methodologies noted
cases where foreclosure is probable or the loan is collateral above and incorporate utilization assumptions at time of
dependent, at the loan’s collateral value or its observable default.
market price, if available. The measurement of ECL for the For loans that are more than 180 days past due and
renegotiated consumer credit card TDR portfolio is based on the collateral-dependent TDRs, the Corporation bases the allowance
present value of projected cash flows discounted using the on the estimated fair value of the underlying collateral as of the
average TDR portfolio contractual interest rate, excluding reporting date less costs to sell. The fair value of the collateral
promotionally priced loans, in effect prior to restructuring. securing these loans is generally determined using an
Projected cash flows for TDRs use the same economic outlook automated valuation model (AVM) that estimates the value of a
as discussed above. For purposes of computing this specific property by reference to market data including sales of
loss component of the allowance, larger impaired loans are comparable properties and price trends specific to the
evaluated individually and smaller impaired loans are evaluated Metropolitan Statistical Area in which the property being valued
as a pool. is located. In the event that an AVM value is not available, the
Also included in the allowance for loan and lease losses are Corporation utilizes publicized indices or if these methods
qualitative reserves to cover losses that are expected but, in the provide less reliable valuations, the Corporation uses appraisals
Corporation's assessment, may not be adequately reflected in or broker price opinions to estimate the fair value of the
the quantitative methods or the economic assumptions collateral. While there is inherent imprecision in these
described above. For example, factors that the Corporation valuations, the Corporation believes that they are representative
considers include changes in lending policies and procedures, of this portfolio in the aggregate.
business conditions, the nature and size of the portfolio, For loans that are more than 180 days past due and
portfolio concentrations, the volume and severity of past due collateral-dependent TDRs, with the exception of the
loans and nonaccrual loans, the effect of external factors such Corporation’s fully insured portfolio, the outstanding balance of
as competition, and legal and regulatory requirements, among loans that is in excess of the estimated property value after


02.25.2021 22:55PM 62539
adjusting for costs to sell is charged off. If the estimated In addition to the allowance for loan and lease losses, the
property value decreases in periods subsequent to the initial Corporation also estimates ECL related to unfunded lending
charge-off, the Corporation will record an additional charge-off; commitments such as letters of credit, financial guarantees,
however, if the value increases in periods subsequent to the unfunded bankers acceptances and binding loan commitments,
charge-off, the Corporation will adjust the allowance to account excluding commitments accounted for under the fair value
for the increase but not to a level above the cumulative charge- option. Reserves are estimated for the unfunded exposure using
off amount. the same models and methodologies as the funded exposure
and are reported as reserves for unfunded lending
Credit Cards and Other Consumer commitments.
Credit cards are revolving lines of credit without a defined
maturity date. The estimated life of a credit card receivable is Nonperforming Loans and Leases, Charge-offs and
determined by estimating the amount and timing of expected Delinquencies
future payments (e.g., borrowers making full payments, Nonperforming loans and leases generally include loans and
minimum payments or somewhere in between) that it will take leases that have been placed on nonaccrual status. Loans
for a receivable balance to pay off. The ECL on the future accounted for under the fair value option and LHFS are not
payments incorporates the spending behavior of a borrower reported as nonperforming.
through time using key borrower-specific factors and the In accordance with the Corporation’s policies, consumer real
economic outlook described above. The Corporation applies all estate-secured loans, including residential mortgages and home
expected payments in accordance with the Credit Card equity loans, are generally placed on nonaccrual status and
Accountability Responsibility and Disclosure Act of 2009 (i.e., classified as nonperforming at 90 days past due unless
paying down the highest interest rate bucket first). Then repayment of the loan is insured by the FHA or through
forecasted future payments are prioritized to pay off the oldest individually insured long-term standby agreements with Fannie
balance until it is brought to zero or an expected charge-off Mae (FNMA) or Freddie Mac (FHLMC) (the fully-insured portfolio).
amount. Unemployment rate outlook, borrower credit score, Residential mortgage loans in the fully-insured portfolio are not
delinquency status and historical payment behavior are all key placed on nonaccrual status and, therefore, are not reported as
inputs into the credit card receivable loss forecasting model. nonperforming. Junior-lien home equity loans are placed on
Future draws on the credit card lines are excluded from the ECL nonaccrual status and classified as nonperforming when the
as they are unconditionally cancellable. underlying first-lien mortgage loan becomes 90 days past due
The ECL for the consumer vehicle lending portfolio is also even if the junior-lien loan is current. The outstanding balance of
determined using quantitative methods supplemented with real estate-secured loans that is in excess of the estimated
qualitative analysis. The quantitative model estimates ECL property value less costs to sell is charged off no later than the
giving consideration to key borrower and loan characteristics end of the month in which the loan becomes 180 days past due
such as delinquency status, borrower credit score, LTV ratio, unless the loan is fully insured, or for loans in bankruptcy, within
underlying collateral type and collateral value. 60 days of receipt of notification of filing, with the remaining
Commercial balance classified as nonperforming.
Consumer loans secured by personal property, credit card
The ECL on commercial loans is forecasted using models that
loans and other unsecured consumer loans are not placed on
estimate credit losses over the loan’s contractual life at an
nonaccrual status prior to charge-off and, therefore, are not
individual loan level. The models use the contractual terms to
reported as nonperforming loans, except for certain secured
forecast future principal cash flows while also considering
consumer loans, including those that have been modified in a
expected prepayments. For open-ended commitments such as
TDR. Personal property-secured loans (including auto loans) are
revolving lines of credit, changes in funded balance are captured
charged off to collateral value no later than the end of the
by forecasting a borrower’s draw and payment behavior over the
month in which the account becomes 120 days past due, or
remaining life of the commitment. For loans collateralized with
upon repossession of an auto or, for loans in bankruptcy, within
commercial real estate and for which the underlying asset is the
60 days of receipt of notification of filing. Credit card and other
primary source of repayment, the loss forecasting models
unsecured customer loans are charged off no later than the end
consider key loan and customer attributes such as LTV ratio,
of the month in which the account becomes 180 days past due,
net operating income and debt service coverage, and captures
within 60 days after receipt of notification of death or
variations in behavior according to property type and region. The
bankruptcy, or upon confirmation of fraud.
outlook on the unemployment rate, gross domestic product, and
Commercial loans and leases, excluding business card
forecasted real estate prices are utilized to determine indicators
loans, that are past due 90 days or more as to principal or
such as rent levels and vacancy rates, which impact the ECL
interest, or where reasonable doubt exists as to timely
estimate. For all other commercial loans and leases, the loss
collection, including loans that are individually identified as
forecasting model determines the probabilities of transition to
being impaired, are generally placed on nonaccrual status and
different credit risk ratings or default at each point over the life
classified as nonperforming unless well-secured and in the
of the asset based on the borrower’s current credit risk rating,
process of collection.
industry sector, size of the exposure and the geographic market.
Business card loans are charged off in the same manner as
The severity of loss is determined based on the type of
consumer credit card loans. Other commercial loans and leases
collateral securing the exposure, the size of the exposure, the
are generally charged off when all or a portion of the principal
borrower’s industry sector, any guarantors and the geographic
amount is determined to be uncollectible.
market. Assumptions of expected loss are conditioned to the

The entire balance of a consumer loan or commercial loan or
economic outlook, and the model considers key economic
lease is contractually delinquent if the minimum payment is not
variables such as unemployment rate, gross domestic product,
received by the specified due date on the customer’s billing
corporate bond spreads, real estate and other asset prices and
statement. Interest and fees continue to accrue on past due
equity market returns.
loans and leases until the date the loan is placed on nonaccrual


02.25.2021 22:55PM 62539
status, if applicable. Accrued interest receivable is reversed addition, for loans modified in response to the pandemic that do
when loans and leases are placed on nonaccrual status. not meet the above criteria (e.g., current payment status at
Interest collections on nonaccruing loans and leases for which December 31, 2019), the Corporation is applying the guidance
the ultimate collectability of principal is uncertain are applied as included in an interagency statement issued by the bank
principal reductions; otherwise, such collections are credited to regulatory agencies. This guidance states that loan
income when received. Loans and leases may be restored to modifications performed in light of the pandemic, including loan
accrual status when all principal and interest is current and full payment deferrals that are up to six months in duration, that
repayment of the remaining contractual principal and interest is were granted to borrowers who were current as of the
expected. implementation date of a loan modification program or
modifications granted under government mandated modification
Troubled Debt Restructurings programs, are not TDRs. For loan modifications that include a
Consumer and commercial loans and leases whose contractual payment deferral and are not TDRs, the borrowers' past due and
terms have been restructured in a manner that grants a nonaccrual status have not been impacted during the deferral
concession to a borrower experiencing financial difficulties are period. The Corporation has continued to accrue interest during
classified as TDRs. Concessions could include a reduction in the deferral period using a constant effective yield method. For
the interest rate to a rate that is below market on the loan, most mortgage, HELOC and commercial loan modifications, the
payment extensions, forgiveness of principal, forbearance or contractual interest that accrued during the deferral period is
other actions designed to maximize collections. Loans that are payable at the maturity of the loan. The Corporation includes
carried at fair value and LHFS are not classified as TDRs. these amounts with the unpaid principal balance when
Loans and leases whose contractual terms have been computing its allowance for credit losses. Amounts that are
modified in a TDR and are current at the time of restructuring subsequently deemed uncollectible are written off against the
may remain on accrual status if there is demonstrated allowance for credit losses.
performance prior to the restructuring and payment in full under
the restructured terms is expected. Otherwise, the loans are Loans Held-for-sale
placed on nonaccrual status and reported as nonperforming, Loans that the Corporation intends to sell in the foreseeable
except for fully-insured consumer real estate loans, until there is future, including residential mortgages, loan syndications, and
sustained repayment performance for a reasonable period, to a lesser degree, commercial real estate, consumer finance
generally six months. If accruing TDRs cease to perform in and other loans, are reported as LHFS and are carried at the
accordance with their modified contractual terms, they are lower of aggregate cost or fair value. The Corporation accounts
placed on nonaccrual status and reported as nonperforming for certain LHFS, including residential mortgage LHFS, under the
TDRs. fair value option. Loan origination costs for LHFS carried at the
Secured consumer loans that have been discharged in lower of cost or fair value are capitalized as part of the carrying
Chapter 7 bankruptcy and have not been reaffirmed by the value of the loans and, upon the sale of a loan, are recognized
borrower are classified as TDRs at the time of discharge. Such as part of the gain or loss in noninterest income. LHFS that are
loans are placed on nonaccrual status and written down to the on nonaccrual status and are reported as nonperforming, as
defined in the policy herein, are reported separately from
estimated collateral value less costs to sell no later than at the
nonperforming loans and leases.
time of discharge. If these loans are contractually current,
interest collections are generally recorded in interest income on Premises and Equipment
a cash basis. Consumer real estate-secured loans for which a Premises and equipment are carried at cost less accumulated
binding offer to restructure has been extended are also depreciation and amortization. Depreciation and amortization
classified as TDRs. Credit card and other unsecured consumer are recognized using the straight-line method over the estimated
loans that have been renegotiated in a TDR generally remain on useful lives of the assets. Estimated lives range up to 40 years
accrual status until the loan is either paid in full or charged off, for buildings, up to 12 years for furniture and equipment, and
which occurs no later than the end of the month in which the the shorter of lease term or estimated useful life for leasehold
loan becomes 180 days past due or, for loans that have been improvements.
placed on a fixed payment plan, 120 days past due.
A loan that had previously been modified in a TDR and is Other Assets
subsequently refinanced under current underwriting standards at For the Corporation’s financial assets that are measured at
a market rate with no concessionary terms is accounted for as a amortized cost and are not included in debt securities or loans
new loan and is no longer reported as a TDR. and leases on the Consolidated Balance Sheet, the Corporation
evaluates these assets for ECL using various techniques. For
COVID-19 Programs assets that are subject to collateral maintenance provisions,
The Corporation has implemented various consumer and including federal funds sold and securities borrowed or
commercial loan modification programs to provide its borrowers purchased under agreements to resell, where the collateral
relief from the economic impacts of the COVID-19 pandemic (the consists of daily margining of liquid and marketable assets
pandemic). In accordance with the Coronavirus Aid, Relief, and where the margining is expected to be maintained into the
Economic Security Act (CARES Act), the Corporation has elected foreseeable future, the expected losses are assumed to be
to not apply TDR classification to eligible COVID-19 related loan zero. For all other assets, the Corporation performs qualitative
modifications that were performed after March 1, 2020 to loans analyses, including consideration of historical losses and
that were current as of December 31, 2019. Accordingly, these current economic conditions, to estimate any ECL which are
restructurings are not classified as TDRs. The availability of this then included in a valuation account that is recorded as a
election expires upon the earlier of January 1, 2022 or 60 days contra-asset against the amortized cost basis of the financial
after the national emergency related to COVID-19 terminates. In asset.


02.25.2021 22:55PM 62539
Lessee Arrangements reversals of goodwill impairment losses are not permitted under
Substantially all of the Corporation’s lessee arrangements are applicable accounting guidance.
operating leases. Under these arrangements, the Corporation For intangible assets subject to amortization, an impairment
records right-of-use assets and lease liabilities at lease loss is recognized if the carrying value of the intangible asset is
commencement. Right-of-use assets are reported in other not recoverable and exceeds fair value. The carrying value of the
assets on the Consolidated Balance Sheet, and the related intangible asset is considered not recoverable if it exceeds the
lease liabilities are reported in accrued expenses and other sum of the undiscounted cash flows expected to result from the
liabilities. All leases are recorded on the Consolidated Balance use of the asset. Intangible assets deemed to have indefinite
Sheet except leases with an initial term less than 12 months for useful lives are not subject to amortization. An impairment loss
which the Corporation made the short-term lease election. is recognized if the carrying value of the intangible asset with an
Lease expense is recognized on a straight-line basis over the indefinite life exceeds its fair value.
lease term and is recorded in occupancy and equipment
expense in the Consolidated Statement of Income. Variable Interest Entities
The Corporation made an accounting policy election not to A VIE is an entity that lacks equity investors or whose equity
separate lease and non-lease components of a contract that is investors do not have a controlling financial interest in the entity
or contains a lease for its real estate and equipment leases. As through their equity investments. The Corporation consolidates
such, lease payments represent payments on both lease and a VIE if it has both the power to direct the activities of the VIE
non-lease components. At lease commencement, lease that most significantly impact the VIE’s economic performance
liabilities are recognized based on the present value of the and an obligation to absorb losses or the right to receive
remaining lease payments and discounted using the benefits that could potentially be significant to the VIE. On a
Corporation’s incremental borrowing rate. Right-of-use assets quarterly basis, the Corporation reassesses its involvement with
initially equal the lease liability, adjusted for any lease payments the VIE and evaluates the impact of changes in governing
made prior to lease commencement and for any lease documents and its financial interests in the VIE. The
incentives. consolidation status of the VIEs with which the Corporation is
involved may change as a result of such reassessments.
Goodwill and Intangible Assets The Corporation primarily uses VIEs for its securitization
Goodwill is the purchase premium after adjusting for the fair activities, in which the Corporation transfers whole loans or debt
value of net assets acquired. Goodwill is not amortized but is securities into a trust or other vehicle. When the Corporation is
reviewed for potential impairment on an annual basis, or when the servicer of whole loans held in a securitization trust,
events or circumstances indicate a potential impairment, at the including non-agency residential mortgages, home equity loans,
reporting unit level. A reporting unit is a business segment or credit cards, and other loans, the Corporation has the power to
one level below a business segment. direct the most significant activities of the trust. The Corporation
The Corporation assesses the fair value of each reporting generally does not have the power to direct the most significant
unit against its carrying value, including goodwill, as measured activities of a residential mortgage agency trust except in certain
by allocated equity. For purposes of goodwill impairment testing, circumstances in which the Corporation holds substantially all of
the Corporation utilizes allocated equity as a proxy for the the issued securities and has the unilateral right to liquidate the
carrying value of its reporting units. Allocated equity in the trust. The power to direct the most significant activities of a
reporting units is comprised of allocated capital plus capital for commercial mortgage securitization trust is typically held by the
the portion of goodwill and intangibles specifically assigned to special servicer or by the party holding specific subordinate
the reporting unit. securities which embody certain controlling rights. The
In performing its goodwill impairment testing, the Corporation consolidates a whole-loan securitization trust if it
Corporation first assesses qualitative factors to determine has the power to direct the most significant activities and also
whether it is more likely than not that the fair value of a holds securities issued by the trust or has other contractual
reporting unit is less than its carrying value. Qualitative factors arrangements, other than standard representations and
include, among other things, macroeconomic conditions, warranties, that could potentially be significant to the trust.
industry and market considerations, financial performance of The Corporation may also transfer trading account securities
the respective reporting unit and other relevant entity- and and AFS securities into municipal bond or resecuritization
reporting-unit specific considerations. trusts. The Corporation consolidates a municipal bond or
If the Corporation concludes it is more likely than not that resecuritization trust if it has control over the ongoing activities
the fair value of a reporting unit is less than its carrying value, a of the trust such as the remarketing of the trust’s liabilities or, if
quantitative assessment is performed. The Corporation has an there are no ongoing activities, sole discretion over the design
unconditional option to bypass the qualitative assessment for of the trust, including the identification of securities to be
any reporting unit in any period and proceed directly to transferred in and the structure of securities to be issued, and
performing the quantitative goodwill impairment test. The also retains securities or has liquidity or other commitments
Corporation may resume performing the qualitative assessment that could potentially be significant to the trust. The Corporation
in any subsequent period. does not consolidate a municipal bond or resecuritization trust if
When performing the quantitative assessment, if the fair one or a limited number of third-party investors share
value of the reporting unit exceeds its carrying value, goodwill of responsibility for the design of the trust or have control over the
the reporting unit would not be considered impaired. If the significant activities of the trust through liquidation or other
carrying value of the reporting unit exceeds its fair value, a substantive rights.
goodwill impairment loss would be recognized for the amount by Other VIEs used by the Corporation include collateralized
which the reporting unit’s allocated equity exceeds its fair value. debt obligations (CDOs), investment vehicles created on behalf
An impairment loss recognized cannot exceed the amount of of customers and other investment vehicles. The Corporation
goodwill assigned to a reporting unit. An impairment loss does not routinely serve as collateral manager for CDOs and,
establishes a new basis in the goodwill, and subsequent therefore, does not typically have the power to direct the


02.25.2021 22:55PM 62539
activities that most significantly impact the economic fair value of the assets or liabilities. Level 3 assets
performance of a CDO. However, following an event of default, if and liabilities include financial instruments for which
the Corporation is a majority holder of senior securities issued the determination of fair value requires significant
by a CDO and acquires the power to manage its assets, the management judgment or estimation. The fair value for
Corporation consolidates the CDO. such assets and liabilities is generally determined
The Corporation consolidates a customer or other using pricing models, discounted cash flow
investment vehicle if it has control over the initial design of the methodologies or similar techniques that incorporate
vehicle or manages the assets in the vehicle and also absorbs the assumptions a market participant would use in
potentially significant gains or losses through an investment in pricing the asset or liability. This category generally
the vehicle, derivative contracts or other arrangements. The includes retained residual interests in securitizations,
Corporation does not consolidate an investment vehicle if a consumer MSRs, certain ABS, highly structured,
single investor controlled the initial design of the vehicle or complex or long-dated derivative contracts, certain
manages the assets in the vehicles or if the Corporation does loans and LHFS, IRLCs and certain CDOs where
not have a variable interest that could potentially be significant independent pricing information cannot be obtained for
to the vehicle. a significant portion of the underlying assets.
Retained interests in securitized assets are initially recorded
at fair value. In addition, the Corporation may invest in debt Income Taxes
securities issued by unconsolidated VIEs. Fair values of these There are two components of income tax expense: current and
debt securities, which are classified as trading account assets, deferred. Current income tax expense reflects taxes to be paid
debt securities carried at fair value or HTM securities, are based or refunded for the current period. Deferred income tax expense
primarily on quoted market prices in active or inactive markets. results from changes in deferred tax assets and liabilities
Generally, quoted market prices for retained residual interests between periods. These gross deferred tax assets and liabilities
are not available; therefore, the Corporation estimates fair represent decreases or increases in taxes expected to be paid
values based on the present value of the associated expected in the future because of future reversals of temporary
future cash flows. differences in the bases of assets and liabilities as measured
by tax laws and their bases as reported in the financial
Fair Value statements. Deferred tax assets are also recognized for tax
The Corporation measures the fair values of its assets and attributes such as net operating loss carryforwards and tax
liabilities, where applicable, in accordance with accounting credit carryforwards. Valuation allowances are recorded to
guidance that requires an entity to base fair value on exit price. reduce deferred tax assets to the amounts management
Under this guidance, an entity is required to maximize the use concludes are more likely than not to be realized.
of observable inputs and minimize the use of unobservable Income tax benefits are recognized and measured based
inputs in measuring fair value. Under applicable accounting upon a two-step model: first, a tax position must be more likely
standards, fair value measurements are categorized into one of than not to be sustained based solely on its technical merits in
three levels based on the inputs to the valuation technique with order to be recognized, and second, the benefit is measured as
the highest priority given to unadjusted quoted prices in active the largest dollar amount of that position that is more likely than
markets and the lowest priority given to unobservable inputs. not to be sustained upon settlement. The difference between
The Corporation categorizes its fair value measurements of the benefit recognized and the tax benefit claimed on a tax
financial instruments based on this three-level hierarchy. return is referred to as an unrecognized tax benefit. The
Corporation records income tax-related interest and penalties, if
Level 1 Unadjusted quoted prices in active markets for applicable, within income tax expense.
identical assets or liabilities. Level 1 assets and
liabilities include debt and equity securities and Revenue Recognition
derivative contracts that are traded in an active The following summarizes the Corporation’s revenue recognition
exchange market, as well as certain U.S. Treasury accounting policies for certain noninterest income activities.
securities that are highly liquid and are actively traded
in OTC markets. Card Income
Level 2 Observable inputs other than Level 1 prices, such as Card income includes annual, late and over-limit fees as well as
quoted prices for similar assets or liabilities, quoted interchange, cash advances and other miscellaneous items
prices in markets that are not active, or other inputs from credit and debit card transactions and from processing
that are observable or can be corroborated by card transactions for merchants. Card income is presented net
observable market data for substantially the full term of direct costs. Interchange fees are recognized upon
of the assets or liabilities. Level 2 assets and settlement of the credit and debit card payment transactions
liabilities include debt securities with quoted prices and are generally determined on a percentage basis for credit
that are traded less frequently than exchange-traded cards and fixed rates for debit cards based on the
instruments and derivative contracts where fair value is corresponding payment network’s rates. Substantially all card
determined using a pricing model with inputs that are fees are recognized at the transaction date, except for certain
observable in the market or can be derived principally time-based fees such as annual fees, which are recognized over
from or corroborated by observable market data. This 12 months. Fees charged to cardholders and merchants that
category generally includes U.S. government and are estimated to be uncollectible are reserved in the allowance
agency mortgage-backed (MBS) and asset-backed for loan and lease losses. Included in direct cost are rewards
securities (ABS), corporate debt securities, derivative and credit card partner payments. Rewards paid to cardholders
contracts, certain loans and LHFS. are related to points earned by the cardholder that can be
Level 3 Unobservable inputs that are supported by little or no redeemed for a broad range of rewards including cash, travel
market activity and that are significant to the overall and gift cards. The points to be redeemed are estimated based
on past redemption behavior, card product type, account

02.25.2021 22:55PM 62539
transaction activity and other historical card performance. The recovered through the revenue the Corporation earns from the
liability is reduced as the points are redeemed. The Corporation customer and are included in operating expenses. Syndication
also makes payments to credit card partners. The payments are fees represent fees earned as the agent or lead lender
based on revenue-sharing agreements that are generally driven responsible for structuring, arranging and administering a loan
by cardholder transactions and partner sales volumes. As part syndication.
of the revenue-sharing agreements, the credit card partner Financial advisory services consist of fees earned for
provides the Corporation exclusive rights to market to the credit assisting clients with transactions related to mergers and
card partner’s members or customers on behalf of the acquisitions and financial restructurings. Revenue varies
Corporation. depending on the size of the transaction and scope of services
performed and is generally contingent on successful completion
Service Charges of the transaction. Revenue is typically recognized once the
Service charges include deposit and lending-related fees. transaction is completed and all services have been rendered.
Deposit-related fees consist of fees earned on consumer and Additionally, the Corporation may earn a fixed fee in merger and
commercial deposit activities and are generally recognized when acquisition transactions to provide a fairness opinion, with the
the transactions occur or as the service is performed. Consumer fees recognized when the opinion is delivered to the client.
fees are earned on consumer deposit accounts for account
maintenance and various transaction-based services, such as Other Revenue Measurement and Recognition Policies
ATM transactions, wire transfer activities, check and money The Corporation did not disclose the value of any open
order processing and insufficient funds/overdraft transactions. performance obligations at December 31, 2020, as its
Commercial deposit-related fees are from the Corporation’s contracts with customers generally have a fixed term that is less
Global Transaction Services business and consist of commercial than one year, an open term with a cancellation period that is
deposit and treasury management services, including account less than one year, or provisions that allow the Corporation to
maintenance and other services, such as payroll, sweep recognize revenue at the amount it has the right to invoice.
account and other cash management services. Lending-related
fees generally represent transactional fees earned from certain Earnings Per Common Share
loan commitments, financial guarantees and SBLCs. Earnings per common share (EPS) is computed by dividing net
income allocated to common shareholders by the weighted-
Investment and Brokerage Services average common shares outstanding, excluding unvested
Investment and brokerage services consist of asset common shares subject to repurchase or cancellation. Net
management and brokerage fees. Asset management fees are income allocated to common shareholders is net income
earned from the management of client assets under advisory adjusted for preferred stock dividends including dividends
agreements or the full discretion of the Corporation’s financial declared, accretion of discounts on preferred stock including
advisors (collectively referred to as assets under management accelerated accretion when preferred stock is repaid early, and
(AUM)). Asset management fees are earned as a percentage of cumulative dividends related to the current dividend period that
the client’s AUM and generally range from 50 basis points (bps) have not been declared as of period end, less income allocated
to 150 bps of the AUM. In cases where a third party is used to to participating securities. Diluted EPS is computed by dividing
obtain a client’s investment allocation, the fee remitted to the income allocated to common shareholders plus dividends on
third party is recorded net and is not reflected in the transaction dilutive convertible preferred stock and preferred stock that can
price, as the Corporation is an agent for those services. be tendered to exercise warrants, by the weighted-average
Brokerage fees include income earned from transaction- common shares outstanding plus amounts representing the
based services that are performed as part of investment dilutive effect of stock options outstanding, restricted stock,
management services and are based on a fixed price per unit or restricted stock units (RSUs), outstanding warrants and the
as a percentage of the total transaction amount. Brokerage fees dilution resulting from the conversion of convertible preferred
also include distribution fees and sales commissions that are stock, if applicable.
primarily in the Global Wealth & Investment Management (GWIM)
segment and are earned over time. In addition, primarily in the Foreign Currency Translation
Global Markets segment, brokerage fees are earned when the Assets, liabilities and operations of foreign branches and
Corporation fills customer orders to buy or sell various financial subsidiaries are recorded based on the functional currency of
products or when it acknowledges, affirms, settles and clears each entity. When the functional currency of a foreign operation
transactions and/or submits trade information to the is the local currency, the assets, liabilities and operations are
appropriate clearing broker. Certain customers pay brokerage, translated, for consolidation purposes, from the local currency
clearing and/or exchange fees imposed by relevant regulatory to the U.S. dollar reporting currency at period-end rates for
bodies or exchanges in order to execute or clear trades. These assets and liabilities and generally at average rates for results
fees are recorded net and are not reflected in the transaction of operations. The resulting unrealized gains and losses are
price, as the Corporation is an agent for those services. reported as a component of accumulated OCI, net-of-tax. When
the foreign entity’s functional currency is the U.S. dollar, the
Investment Banking Income resulting remeasurement gains or losses on foreign currency-
Investment banking income includes underwriting income and denominated assets or liabilities are included in earnings.
financial advisory services income. Underwriting consists of fees
earned for the placement of a customer’s debt or equity Paycheck Protection Program
securities. The revenue is generally earned based on a The Corporation is participating in the Paycheck Protection
percentage of the fixed number of shares or principal placed. Program (PPP), which is a loan program that originated from the
Once the number of shares or notes is determined and the CARES Act and was subsequently expanded by the Paycheck
service is completed, the underwriting fees are recognized. The Protection Program and Health Care Enhancement Act. The PPP
Corporation incurs certain out-of-pocket expenses, such as legal is designed to provide U.S. small businesses with cash-flow
costs, in performing these services. These expenses are assistance through loans fully guaranteed by the Small

02.25.2021 22:55PM 62539
Business Administration (SBA). If the borrower meets certain Corporation had approximately 332,000 PPP loans with a
criteria and uses the proceeds towards certain eligible carrying value of $22.7 billion. As compensation for originating
expenses, the borrower’s obligation to repay the loan can be the loans, the Corporation received lender processing fees from
forgiven up to the full principal amount of the loan and any the SBA, which are capitalized, along with the loan origination
accrued interest. Upon borrower forgiveness, the SBA pays the costs, and will be amortized over the loans’ contractual lives
Corporation for the principal and accrued interest owed on the and recognized as interest income. Upon forgiveness of a loan
loan. If the full principal of the loan is not forgiven, the loan will and repayment by the SBA, any unrecognized net capitalized
operate according to the original loan terms with the 100 fees and costs related to the loan will be recognized as interest
percent SBA guaranty remaining. As of December 31, 2020, the income in that period.
NOTE 2 Net Interest Income and Noninterest Income

The table below presents the Corporation’s net interest income and noninterest income disaggregated by revenue source for 2020,
2019 and 2018. For more information, see Note 1 – Summary of Significant Accounting Principles. For a disaggregation of
noninterest income by business segment and All Other, see Note 23 – Business Segment Information.

Net interest income
Interest income
Loans and leases $ 34,029 $ 43,086 $ 40,811
Debt securities 9,790 11,806 11,724
Federal funds sold and securities borrowed or purchased under agreements to resell 903 4,843 3,176
Trading account assets 4,128 5,196 4,811
Other interest income 2,735 6,305 6,247
Total interest income 51,585 71,236 66,769
Interest expense
Deposits 1,943 7,188 4,495
Short-term borrowings 987 7,208 5,839
Trading account liabilities 974 1,249 1,358
Long-term debt 4,321 6,700 6,915
Total interest expense 8,225 22,345 18,607
Net interest income $ 43,360 $ 48,891 $ 48,162
Noninterest income
Fees and commissions
Card income
Interchange fees (1) $ 3,954 $ 3,834 $ 3,866
Other card income 1,702 1,963 1,958
Total card income 5,656 5,797 5,824
Service charges
Deposit-related fees 5,991 6,588 6,667
Lending-related fees 1,150 1,086 1,100
Total service charges 7,141 7,674 7,767
Investment and brokerage services
Asset management fees 10,708 10,241 10,189
Brokerage fees 3,866 3,661 3,971
Total investment and brokerage services 14,574 13,902 14,160
Investment banking fees
Underwriting income 4,698 2,998 2,722
Syndication fees 861 1,184 1,347
Financial advisory services 1,621 1,460 1,258
Total investment banking fees 7,180 5,642 5,327
Total fees and commissions 34,551 33,015 33,078
Market making and similar activities 8,355 9,034 9,008
Other income (loss) (738) 304 772
Total noninterest income $ 42,168 $ 42,353 $ 42,858
(1)
Gross interchange fees were $9.2 billion, $10.0 billion and $9.5 billion for 2020, 2019 and 2018, respectively, and are presented net of $5.5 billion, $6.2 billion and $5.6 billion of expenses for
rewards and partner payments as well as certain other card costs for the same periods.


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NOTE 3 Derivatives Corporation’s derivatives and hedging activities, see Note 1 –

Summary of Significant Accounting Principles. The following
Derivative Balances tables present derivative instruments included on the
Derivatives are entered into on behalf of customers, for trading Consolidated Balance Sheet in derivative assets and liabilities
or to support risk management activities. Derivatives used in at December 31, 2020 and 2019. Balances are presented on a
risk management activities include derivatives that may or may gross basis, prior to the application of counterparty and cash
not be designated in qualifying hedge accounting relationships. collateral netting. Total derivative assets and liabilities are
Derivatives that are not designated in qualifying hedge adjusted on an aggregate basis to take into consideration the
accounting relationships are referred to as other risk effects of legally enforceable master netting agreements and
management derivatives. For more information on the have been reduced by cash collateral received or paid.
December 31, 2020

Gross Derivative Assets Gross Derivative Liabilities
Trading and Trading and

Other Risk Qualifying Other Risk Qualifying
Contract/ Management Accounting Management Accounting
(Dollars in billions) Notional (1) Derivatives Hedges Total Derivatives Hedges Total
Interest rate contracts
Swaps $ 13,242.8 $ 199.9 $ 10.9 $ 210.8 $ 209.3 $ 1.3 $ 210.6
Futures and forwards 3,222.2 3.5 0.1 3.6 3.6 — 3.6
Written options 1,530.5 — — — 40.5 — 40.5
Purchased options 1,545.8 45.3 — 45.3 — — —
Foreign exchange contracts
Swaps 1,475.8 37.1 0.3 37.4 39.7 0.6 40.3
Spot, futures and forwards 3,710.7 53.4 — 53.4 54.5 0.5 55.0
Written options 289.6 — — — 4.8 — 4.8
Purchased options 279.3 5.0 — 5.0 — — —
Equity contracts
Swaps 320.2 13.3 — 13.3 14.5 — 14.5
Futures and forwards 106.2 0.3 — 0.3 1.4 — 1.4
Written options 599.1 — — — 48.8 — 48.8
Commodity contracts
Swaps 36.4 1.9 — 1.9 4.4 — 4.4
Written options 24.6 — — — 1.4 — 1.4
Credit derivatives (2)
Purchased credit derivatives:
Credit default swaps 322.7 2.3 — 2.3 4.4 — 4.4
Total return swaps/options 63.6 0.2 — 0.2 1.0 — 1.0
Written credit derivatives:
Gross derivative assets/liabilities $ 423.3 $ 11.3 $ 434.6 $ 431.6 $ 2.4 $ 434.0
Less: Legally enforceable master netting agreements (344.9) (344.9)
Less: Cash collateral received/paid (42.5) (43.6)
Total derivative assets/liabilities $ 47.2 $ 45.5
(1)
Represents the total contract/notional amount of derivative assets and liabilities outstanding.
(2)
The net derivative asset (liability) and notional amount of written credit derivatives for which the Corporation held purchased credit derivatives with identical underlying referenced names were $2.2
billion and $269.8 billion at December 31, 2020.


02.25.2021 22:55PM 62539
December 31, 2019

Gross Derivative Assets Gross Derivative Liabilities
Trading and Trading and

Other Risk Qualifying Other Risk Qualifying
Contract/ Management Accounting Management Accounting
(Dollars in billions) Notional (1) Derivatives Hedges Total Derivatives Hedges Total
Swaps $ 15,074.4 $ 162.0 $ 9.7 $ 171.7 $ 168.5 $ 0.4 $ 168.9
Futures and forwards 3,279.8 1.0 — 1.0 1.0 — 1.0
Written options 1,767.7 — — — 32.5 — 32.5
Purchased options 1,673.6 37.4 — 37.4 — — —
Swaps 1,657.7 30.3 0.7 31.0 31.7 0.9 32.6
Spot, futures and forwards 3,792.7 35.9 0.1 36.0 38.7 0.3 39.0
Written options 274.3 — — — 3.8 — 3.8
Equity contracts
Swaps 315.0 6.5 — 6.5 8.1 — 8.1
Written options 731.1 — — — 34.6 — 34.6
Commodity contracts
Swaps 42.0 2.1 — 2.1 4.4 — 4.4
Written options 33.2 — — — 1.4 — 1.4
Credit derivatives (2)
Purchased credit derivatives:
Written credit derivatives:
Gross derivative assets/liabilities $ 334.3 $ 10.5 $ 344.8 $ 335.5 $ 1.6 $ 337.1
Less: Legally enforceable master netting agreements (270.4) (270.4)
Less: Cash collateral received/paid (33.9) (28.5)
Total derivative assets/liabilities $ 40.5 $ 38.2
(1)
Represents the total contract/notional amount of derivative assets and liabilities outstanding.
(2)
The net derivative asset (liability) and notional amount of written credit derivatives for which the Corporation held purchased credit derivatives with identical underlying referenced names were $2.8
billion and $309.7 billion at December 31, 2019.
Offsetting of Derivatives Sheet at December 31, 2020 and 2019 by primary risk (e.g.,
The Corporation enters into International Swaps and Derivatives interest rate risk) and the platform, where applicable, on which
Association, Inc. (ISDA) master netting agreements or similar these derivatives are transacted. Balances are presented on a
agreements with substantially all of the Corporation’s derivative gross basis, prior to the application of counterparty and cash
counterparties. Where legally enforceable, these master netting collateral netting. Total gross derivative assets and liabilities
agreements give the Corporation, in the event of default by the are adjusted on an aggregate basis to take into consideration
counterparty, the right to liquidate securities held as collateral the effects of legally enforceable master netting agreements
and to offset receivables and payables with the same which include reducing the balance for counterparty netting and
counterparty. For purposes of the Consolidated Balance Sheet, cash collateral received or paid.
the Corporation offsets derivative assets and liabilities and For more information on offsetting of securities financing
cash collateral held with the same counterparty where it has agreements, see Note 10 – Federal Funds Sold or Purchased,
such a legally enforceable master netting agreement. Securities Financing Agreements, Short-term Borrowings and
The following table presents derivative instruments included Restricted Cash.
in derivative assets and liabilities on the Consolidated Balance


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Offsetting of Derivatives (1)
Derivative Derivative Derivative Derivative

Assets Liabilities Assets Liabilities
(Dollars in billions) December 31, 2020 December 31, 2019
Over-the-counter $ 247.7 $ 243.5 $ 203.1 $ 196.6
Exchange-traded — — 0.1 0.1
Over-the-counter cleared 10.2 9.1 6.0 5.3
Over-the-counter 92.2 96.5 69.2 73.1
Equity contracts
Over-the-counter 31.3 28.3 21.3 17.8
Exchange-traded 32.3 31.0 26.4 22.8
Commodity contracts
Over-the-counter 3.5 5.0 2.8 4.2
Over-the-counter cleared — — — 0.1
Credit derivatives
Over-the-counter 5.2 5.6 6.4 6.6
Total gross derivative assets/liabilities, before netting
Over-the-counter 379.9 378.9 302.8 298.3
Less: Legally enforceable master netting agreements and cash collateral received/paid
Over-the-counter (345.7) (347.2) (274.7) (269.3)
Exchange-traded (29.5) (29.5) (21.5) (21.5)
Over-the-counter cleared (12.2) (11.8) (8.1) (8.1)
Derivative assets/liabilities, after netting 39.3 34.4 34.8 31.2
Other gross derivative assets/liabilities (2) 7.9 11.1 5.7 7.0
Total derivative assets/liabilities 47.2 45.5 40.5 38.2
Less: Financial instruments collateral (3) (16.1) (16.6) (14.6) (16.1)
Total net derivative assets/liabilities $ 31.1 $ 28.9 $ 25.9 $ 22.1
(1)
OTC derivatives include bilateral transactions between the Corporation and a particular counterparty. OTC-cleared derivatives include bilateral transactions between the Corporation and a
counterparty where the transaction is cleared through a clearinghouse. Exchange-traded derivatives include listed options transacted on an exchange.
(2)
Consists of derivatives entered into under master netting agreements where the enforceability of these agreements is uncertain under bankruptcy laws in some countries or industries.
(3)
Amounts are limited to the derivative asset/liability balance and, accordingly, do not include excess collateral received/pledged. Financial instruments collateral includes securities collateral
received or pledged and cash securities held and posted at third-party custodians that are not offset on the Consolidated Balance Sheet but shown as a reduction to derive net derivative assets
and liabilities.
ALM and Risk Management Derivatives forward loan sale commitments and other derivative
The Corporation’s ALM and risk management activities include instruments, including purchased options, and certain debt
the use of derivatives to mitigate risk to the Corporation securities. The Corporation also utilizes derivatives such as
including derivatives designated in qualifying hedge accounting interest rate options, interest rate swaps, forward settlement
relationships and derivatives used in other risk management contracts and eurodollar futures to hedge certain market risks
activities. Interest rate, foreign exchange, equity, commodity of MSRs.
and credit contracts are utilized in the Corporation's ALM and The Corporation uses foreign exchange contracts to manage
risk management activities. the foreign exchange risk associated with certain foreign
The Corporation maintains an overall interest rate risk currency-denominated assets and liabilities, as well as the
management strategy that incorporates the use of interest rate Corporation’s investments in non-U.S. subsidiaries. Exposure to
contracts, which are generally non-leveraged generic interest loss on these contracts will increase or decrease over their
rate and basis swaps, options, futures and forwards, to respective lives as currency exchange and interest rates
minimize significant fluctuations in earnings caused by interest fluctuate.
rate volatility. The Corporation’s goal is to manage interest rate The Corporation purchases credit derivatives to manage
sensitivity and volatility so that movements in interest rates do credit risk related to certain funded and unfunded credit
not significantly adversely affect earnings or capital. As a result exposures. Credit derivatives include credit default swaps
of interest rate fluctuations, hedged fixed-rate assets and (CDS), total return swaps and swaptions. These derivatives are
liabilities appreciate or depreciate in fair value. Gains or losses recorded on the Consolidated Balance Sheet at fair value with
on the derivative instruments that are linked to the hedged changes in fair value recorded in other income.
fixed-rate assets and liabilities are expected to substantially
offset this unrealized appreciation or depreciation.
Derivatives Designated as Accounting Hedges
Market risk, including interest rate risk, can be substantial in The Corporation uses various types of interest rate and foreign
the mortgage business. Market risk in the mortgage business is exchange derivative contracts to protect against changes in the
the risk that values of mortgage assets or revenues will be fair value of its assets and liabilities due to fluctuations in
adversely affected by changes in market conditions such as interest rates and exchange rates (fair value hedges). The
interest rate movements. To mitigate the interest rate risk in Corporation also uses these types of contracts to protect
mortgage banking production income, the Corporation utilizes against changes in the cash flows of its assets and liabilities,


02.25.2021 22:55PM 62539
and other forecasted transactions (cash flow hedges). The the U.S. dollar using forward exchange contracts and cross-
Corporation hedges its net investment in consolidated non-U.S. currency basis swaps, and by issuing foreign currency-
operations determined to have functional currencies other than denominated debt (net investment hedges).
Fair Value Hedges

The following table summarizes information related to fair value hedges for 2020, 2019 and 2018.
Gains and Losses on Derivatives Designated as Fair Value Hedges

Derivative Hedged Item
Interest rate risk on long-term debt (1) $ 7,091 $ 6,113 $ (1,538) $ (7,220) $ (6,110) $ 1,429
Interest rate and foreign currency risk on long-term debt (2) 783 119 (1,187) (783) (101) 1,079
Interest rate risk on available-for-sale securities (3) (44) (102) (52) 49 98 50
Total $ 7,830 $ 6,130 $ (2,777) $ (7,954) $ (6,113) $ 2,558
(1)
Amounts are recorded in interest expense in the Consolidated Statement of Income.
(2)
In 2020, 2019 and 2018, the derivative amount includes gains (losses) of $701 million, $73 million and $(116) million in interest expense, $73 million, $28 million and $(992) million in market
making and similar activities, and $9 million, $18 million and $(79) million in accumulated OCI, respectively. Line item totals are in the Consolidated Statement of Income and on the
Consolidated Balance Sheet.
(3)
Amounts are recorded in interest income in the Consolidated Statement of Income.
The table below summarizes the carrying value of hedged assets and liabilities that are designated and qualifying in fair value
hedging relationships along with the cumulative amount of fair value hedging adjustments included in the carrying value that have
been recorded in the current hedging relationships. These fair value hedging adjustments are open basis adjustments that are not
subject to amortization as long as the hedging relationship remains designated.
Designated Fair Value Hedged Assets (Liabilities)

Cumulative Cumulative
Fair Value Fair Value
Carrying Value Adjustments (1) Carrying Value Adjustments (1)
(Dollars in millions) December 31, 2020 December 31, 2019
Long-term debt (2) $ (150,556) $ (8,910) $ (162,389) $ (8,685)
Available-for-sale debt securities (2, 3, 4) 116,252 114 1,654 64
Trading account assets (5) 427 15 — —
(1)
For assets, increase (decrease) to carrying value and for liabilities, (increase) decrease to carrying value.
(2)
At December 31, 2020 and 2019, the cumulative fair value adjustments remaining on long-term debt and AFS debt securities from discontinued hedging relationships resulted in an (increase)
decrease in the related liability of $(3.7) billion and $1.3 billion and an increase (decrease) in the related asset of $(69) million and $8 million, which are being amortized over the remaining
contractual life of the de-designated hedged items.
(3)
These amounts include the amortized cost basis of the prepayable financial assets used to designate hedging relationships in which the hedged item is the last layer expected to be remaining at
the end of the hedging relationship (i.e. last-of-layer hedging relationship). At December 31, 2020, the amortized cost of the closed portfolios used in these hedging relationships was $34.6
billion, of which $7.0 billion was designated in the last-of-layer hedging relationship. The cumulative basis adjustments associated with these hedging relationships were not significant.
(4)
Carrying value represents amortized cost.
(5)
Represents hedging activities related to precious metals inventory.
Cash Flow and Net Investment Hedges reclassified into earnings in the next 12 months. These net
The following table summarizes certain information related to gains reclassified into earnings are expected to primarily
cash flow hedges and net investment hedges for 2020, 2019 increase net interest income related to the respective hedged
and 2018. Of the $426 million after-tax net gain ($566 million items. For terminated cash flow hedges, the time period over
pretax) on derivatives in accumulated OCI at December 31, which the majority of the forecasted transactions are hedged is
2020, gains of $190 million after-tax ($254 million pretax) approximately 3 years, with a maximum length of time for
related to both open and terminated hedges are expected to be certain forecasted transactions of 16 years.
Gains and Losses on Derivatives Designated as Cash Flow and Net Investment Hedges
Gains (Losses) Recognized in Gains (Losses) in Income
Accumulated OCI on Derivatives Reclassified from Accumulated OCI
(Dollars in millions, amounts pretax) 2020 2019 2018 2020 2019 2018
Cash flow hedges
Interest rate risk on variable-rate assets (1) $ 763 $ 671 $ (159) $ (7) $ (104) $ (165)
Price risk on forecasted MBS purchases (1) 241 — — 9 — —
Price risk on certain compensation plans (2) 85 34 4 12 (2) 27
Total $ 1,089 $ 705 $ (155) $ 14 $ (106) $ (138)
Net investment hedges
Foreign exchange risk (3) $ (834) $ 22 $ 989 $ 4 $ 366 $ 411
(1)
Amounts reclassified from accumulated OCI are recorded in interest income in the Consolidated Statement of Income.
(2)
Amounts reclassified from accumulated OCI are recorded in compensation and benefits expense in the Consolidated Statement of Income.
(3)
Amounts reclassified from accumulated OCI are recorded in other income in the Consolidated Statement of Income. Amounts excluded from effectiveness testing and recognized in market making
and similar activities were gains (losses) of $(11) million, $154 million and $47 million in 2020, 2019 and 2018, respectively.


02.25.2021 22:55PM 62539
Other Risk Management Derivatives market making and similar activities. Unlike commissions for
Other risk management derivatives are used by the Corporation equity securities, the initial revenue related to broker-dealer
to reduce certain risk exposures by economically hedging services for debt securities is typically included in the pricing of
various assets and liabilities. The following table presents gains the instrument rather than being charged through separate fee
(losses) on these derivatives for 2020, 2019 and 2018. These arrangements. Therefore, this revenue is recorded in market
gains (losses) are largely offset by the income or expense making and similar activities as part of the initial mark to fair
recorded on the hedged item. value. For derivatives, the majority of revenue is included in
market making and similar activities. In transactions where the
Corporation acts as agent, which include exchange-traded
Gains and Losses on Other Risk Management Derivatives futures and options, fees are recorded in other income.
The following table, which includes both derivatives and non-
(Dollars in millions) 2020 2019 2018 derivative cash instruments, identifies the amounts in the
Interest rate risk on mortgage activities (1, 2) $ 446 $ 315 $ (107) respective income statement line items attributable to the
Credit risk on loans (2) (68) (58) 9 Corporation’s sales and trading revenue in Global Markets,
Interest rate and foreign currency risk on categorized by primary risk, for 2020, 2019 and 2018. This
ALM activities (3) (2,971) 1,112 3,278 table includes debit valuation adjustment (DVA) and funding
Price risk on certain compensation plans (4) 700 943 (495) valuation adjustment (FVA) gains (losses). Global Markets
(1)
Primarily related to hedges of interest rate risk on MSRs and IRLCs to originate mortgage results in Note 23 – Business Segment Information are
loans that will be held for sale. The net gains on IRLCs, which are not included in the table
but are considered derivative instruments, were $165 million, $73 million and $47 million in presented on a fully taxable-equivalent (FTE) basis. The table
(2)
2020, 2019 and 2018. below is not presented on an FTE basis.
Gains (losses) on these derivatives are recorded in other income.
(3)
Gains (losses) on these derivatives are recorded in market making and similar activities.
(4)
Gains (losses) on these derivatives are recorded in compensation and benefits expense.
Sales and Trading Revenue
Transfers of Financial Assets with Risk Retained
through Derivatives Market
making Net
The Corporation enters into certain transactions involving the and similar Interest
transfer of financial assets that are accounted for as sales activities Income Other (1) Total
where substantially all of the economic exposure to the (Dollars in millions) 2020
Interest rate risk $ 2,211 $ 2,400 $ 231 $ 4,842
transferred financial assets is retained through derivatives (e.g.,
Foreign exchange risk 1,482 (20) 3 1,465
interest rate and/or credit), but the Corporation does not retain
Equity risk 3,656 (77) 1,801 5,380
control over the assets transferred. At both December 31, 2020 Credit risk 812 1,638 328 2,778
and 2019, the Corporation had transferred $5.2 billion of non- Other risk 308 4 44 356
U.S. government-guaranteed mortgage-backed securities to a Total sales and trading
third-party trust and retained economic exposure to the revenue $ 8,469 $ 3,945 $ 2,407 $ 14,821
transferred assets through derivative contracts. In connection
with these transfers, the Corporation received gross cash 2019
proceeds of $5.2 billion as of both transfer dates. At December Interest rate risk $ 1,000 $ 1,817 $ 113 $ 2,930
31, 2020 and 2019, the fair value of the transferred securities Foreign exchange risk 1,288 62 57 1,407
was $5.5 billion and $5.3 billion. Equity risk 3,563 (634) 1,569 4,498
Credit risk 1,091 1,807 519 3,417
Sales and Trading Revenue Other risk 120 70 53 243
The Corporation enters into trading derivatives to facilitate client Total sales and trading
revenue $ 7,062 $ 3,122 $ 2,311 $ 12,495
transactions and to manage risk exposures arising from trading
account assets and liabilities. It is the Corporation’s policy to 2018
include these derivative instruments in its trading activities, Interest rate risk $ 810 $ 1,651 $ 245 $ 2,706
which include derivatives and non-derivative cash instruments. Foreign exchange risk 1,504 31 22 1,557
Equity risk 3,870 (657) 1,643 4,856
The resulting risk from these derivatives is managed on a
Credit risk 1,034 1,886 600 3,520
portfolio basis as part of the Corporation’s Global Markets
Other risk 40 197 49 286
business segment. The related sales and trading revenue Total sales and trading
generated within Global Markets is recorded in various income revenue $ 7,258 $ 3,108 $ 2,559 $ 12,925
statement line items, including market making and similar (1)
Represents amounts in investment and brokerage services and other income that are
activities and net interest income as well as other revenue recorded in Global Markets and included in the definition of sales and trading revenue.
Includes investment and brokerage services revenue of $1.9 billion, $1.7 billion and $1.7
categories. billion in 2020, 2019 and 2018, respectively.
Sales and trading revenue includes changes in the fair value
and realized gains and losses on the sales of trading and other Credit Derivatives
assets, net interest income, and fees primarily from The Corporation enters into credit derivatives primarily to
commissions on equity securities. Revenue is generated by the facilitate client transactions and to manage credit risk
difference in the client price for an instrument and the price at exposures. Credit derivatives derive value based on an
which the trading desk can execute the trade in the dealer underlying third-party referenced obligation or a portfolio of
market. For equity securities, commissions related to purchases referenced obligations and generally require the Corporation, as
and sales are recorded in the “Other” column in the Sales and the seller of credit protection, to make payments to a buyer
Trading Revenue table. Changes in the fair value of these upon the occurrence of a predefined credit event. Such credit
securities are included in market making and similar activities. events generally include bankruptcy of the referenced credit
For debt securities, revenue, with the exception of interest entity and failure to pay under the obligation, as well as
associated with the debt securities, is typically included in acceleration of indebtedness and payment repudiation or


02.25.2021 22:55PM 62539
moratorium. For credit derivatives based on a portfolio of or higher as investment grade. Non-investment grade includes
referenced credits or credit indices, the Corporation may not be non-rated credit derivative instruments. The Corporation
required to make payment until a specified amount of loss has discloses internal categorizations of investment grade and non-
occurred and/or may only be required to make payment up to a investment grade consistent with how risk is managed for these
specified amount. instruments.
Credit derivatives are classified as investment and non- Credit derivative instruments where the Corporation is the
investment grade based on the credit quality of the underlying seller of credit protection and their expiration at December 31,
referenced obligation. The Corporation considers ratings of BBB- 2020 and 2019 are summarized in the following table.
Credit Derivative Instruments

Less than One to Three to Over Five
One Year Three Years Five Years Years Total
December 31, 2020
(Dollars in millions) Carrying Value
Credit default swaps:
Investment grade $ — $ 1 $ 35 $ 94 $ 130
Non-investment grade 26 233 364 1,163 1,786
Total 26 234 399 1,257 1,916
Total return swaps/options:
Investment grade 21 4 — — 25
Non-investment grade 345 — — — 345
Total 366 4 — — 370
Total credit derivatives $ 392 $ 238 $ 399 $ 1,257 $ 2,286
Credit-related notes:
Investment grade $ — $ — $ — $ 572 $ 572
Non-investment grade 64 2 10 947 1,023
Total credit-related notes $ 64 $ 2 $ 10 $ 1,519 $ 1,595
Maximum Payout/Notional
Investment grade $ 33,474 $ 75,731 $ 87,218 $ 16,822 $ 213,245
Non-investment grade 13,664 28,770 35,978 9,852 88,264
Total 47,138 104,501 123,196 26,674 301,509
Investment grade 30,961 1,061 77 — 32,099
Non-investment grade 36,128 364 27 5 36,524
Total 67,089 1,425 104 5 68,623
Total credit derivatives $ 114,227 $ 105,926 $ 123,300 $ 26,679 $ 370,132
December 31, 2019

Carrying Value
Non-investment grade 70 292 561 808 1,731
Total 70 297 621 972 1,960
Investment grade 35 — — — 35
Non-investment grade 344 — — — 344
Total 379 — — — 379
Total credit derivatives $ 449 $ 297 $ 621 $ 972 $ 2,339
Credit-related notes:
Non-investment grade 6 2 1 1,125 1,134
Total credit-related notes $ 6 $ 5 $ 2 $ 1,764 $ 1,777
Maximum Payout/Notional
Investment grade $ 55,827 $ 67,838 $ 71,320 $ 17,708 $ 212,693
Non-investment grade 19,049 26,521 29,618 12,337 87,525
Total 74,876 94,359 100,938 30,045 300,218
Investment grade 56,488 — 62 76 56,626
Non-investment grade 28,707 657 104 60 29,528
Total 85,195 657 166 136 86,154
Total credit derivatives $ 160,071 $ 95,016 $ 101,104 $ 30,181 $ 386,372
The notional amount represents the maximum amount within acceptable, predefined limits.
payable by the Corporation for most credit derivatives. However, Credit-related notes in the table above include investments
the Corporation does not monitor its exposure to credit in securities issued by CDO, collateralized loan obligation (CLO)
derivatives based solely on the notional amount because this and credit-linked note vehicles. These instruments are primarily
measure does not take into consideration the probability of classified as trading securities. The carrying value of these
occurrence. As such, the notional amount is not a reliable instruments equals the Corporation’s maximum exposure to
indicator of the Corporation’s exposure to these contracts. loss. The Corporation is not obligated to make any payments to
Instead, a risk framework is used to define risk tolerances and the entities under the terms of the securities owned.
establish limits so that certain credit risk-related losses occur

02.25.2021 22:55PM 62539
Credit-related Contingent Features and Collateral

The Corporation executes the majority of its derivative contracts Additional Collateral Required to be Posted Upon
in the OTC market with large, international financial institutions, Downgrade at December 31, 2020
including broker-dealers and, to a lesser degree, with a variety
of non-financial companies. A significant majority of the One Second
derivative transactions are executed on a daily margin basis. incremental incremental
(Dollars in millions) notch notch
Therefore, events such as a credit rating downgrade (depending
Bank of America Corporation $ 300 $ 735
on the ultimate rating level) or a breach of credit covenants Bank of America, N.A. and subsidiaries (1) 61 570
would typically require an increase in the amount of collateral (1)
Included in Bank of America Corporation collateral requirements in this table.
required of the counterparty, where applicable, and/or allow the
Corporation to take additional protective measures such as The following table presents the derivative liabilities that
early termination of all trades. Further, as previously discussed would be subject to unilateral termination by counterparties and
on page 135, the Corporation enters into legally enforceable the amounts of collateral that would have been contractually
master netting agreements that reduce risk by permitting required at December 31, 2020 if the long-term senior debt
closeout and netting of transactions with the same counterparty ratings for the Corporation or certain subsidiaries had been
upon the occurrence of certain events. lower by one incremental notch and by an additional second
Certain of the Corporation’s derivative contracts contain incremental notch.
credit risk-related contingent features, primarily in the form of
ISDA master netting agreements and credit support
Derivative Liabilities Subject to Unilateral Termination
documentation that enhance the creditworthiness of these
instruments compared to other obligations of the respective
Upon Downgrade at December 31, 2020
counterparty with whom the Corporation has transacted. These One Second
contingent features may be for the benefit of the Corporation as incremental incremental
well as its counterparties with respect to changes in the (Dollars in millions) notch notch
Corporation’s creditworthiness and the mark-to-market exposure Derivative liabilities $ 45 $ 1,035
Collateral posted 23 544
under the derivative transactions. At December 31, 2020 and
2019, the Corporation held cash and securities collateral of
$96.5 billion and $84.3 billion and posted cash and securities Valuation Adjustments on Derivatives
collateral of $88.6 billion and $69.1 billion in the normal course The Corporation records credit risk valuation adjustments on
of business under derivative agreements, excluding cross- derivatives in order to properly reflect the credit quality of the
product margining agreements where clients are permitted to counterparties and its own credit quality. The Corporation
margin on a net basis for both derivative and secured financing calculates valuation adjustments on derivatives based on a
arrangements. modeled expected exposure that incorporates current market
In connection with certain OTC derivative contracts and other risk factors. The exposure also takes into consideration credit
trading agreements, the Corporation can be required to provide mitigants such as enforceable master netting agreements and
additional collateral or to terminate transactions with certain collateral. CDS spread data is used to estimate the default
counterparties in the event of a downgrade of the senior debt probabilities and severities that are applied to the exposures.
ratings of the Corporation or certain subsidiaries. The amount of Where no observable credit default data is available for
additional collateral required depends on the contract and is counterparties, the Corporation uses proxies and other market
usually a fixed incremental amount and/or the market value of data to estimate default probabilities and severity.
the exposure. The table below presents credit valuation adjustment (CVA),
At December 31, 2020, the amount of collateral, calculated DVA and FVA gains (losses) on derivatives (excluding the effect
based on the terms of the contracts, that the Corporation and of any related hedge activities), which are recorded in market
certain subsidiaries could be required to post to counterparties making and similar activities, for 2020, 2019 and 2018. CVA
but had not yet posted to counterparties was $2.6 billion, gains reduce the cumulative CVA thereby increasing the
including $1.2 billion for Bank of America, National Association derivative assets balance. DVA gains increase the cumulative
(BANA). DVA thereby decreasing the derivative liabilities balance. CVA
Some counterparties are currently able to unilaterally and DVA losses have the opposite impact. FVA gains related to
terminate certain contracts, or the Corporation or certain derivative assets reduce the cumulative FVA thereby increasing
subsidiaries may be required to take other action such as find a the derivative assets balance. FVA gains related to derivative
suitable replacement or obtain a guarantee. At December 31, liabilities increase the cumulative FVA thereby decreasing the
2020 and 2019, the liability recorded for these derivative derivative liabilities balance. FVA losses have the opposite
contracts was not significant. impact.
The following table presents the amount of additional
collateral that would have been contractually required by Valuation Adjustments Gains (Losses) on Derivatives (1)
derivative contracts and other trading agreements at
December 31, 2020 if the rating agencies had downgraded their (Dollars in millions) 2020 2019 2018
long-term senior debt ratings for the Corporation or certain Derivative assets (CVA) $ (118) $ 72 $ 77
subsidiaries by one incremental notch and by an additional Derivative assets/liabilities (FVA) (24) (2) (15)
second incremental notch. Derivative liabilities (DVA) 24 (147) (19)

(1)
At December 31, 2020, 2019 and 2018, cumulative CVA reduced the derivative assets
balance by $646 million, $528 million and $600 million, cumulative FVA reduced the net
derivatives balance by $177 million, $153 million and $151 million, and cumulative DVA
reduced the derivative liabilities balance by $309 million, $285 million and $432 million,
respectively.


02.25.2021 22:55PM 62539
NOTE 4 Securities
The table below presents the amortized cost, gross unrealized gains and losses, and fair value of AFS debt securities, other debt
securities carried at fair value and HTM debt securities at December 31, 2020 and 2019.
Debt Securities
Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
Available-for-sale debt securities
Mortgage-backed securities:
Agency $ 59,518 $ 2,370 $ (39) $ 61,849
Agency-collateralized mortgage obligations 5,112 161 (13) 5,260
Commercial 15,470 1,025 (4) 16,491
Non-agency residential (1) 899 127 (17) 1,009
Total mortgage-backed securities 80,999 3,683 (73) 84,609
U.S. Treasury and agency securities 114,157 2,236 (13) 116,380
Non-U.S. securities 14,009 15 (7) 14,017
Other taxable securities, substantially all asset-backed securities 2,656 61 (6) 2,711
Total taxable securities 211,821 5,995 (99) 217,717
Tax-exempt securities 16,417 389 (32) 16,774
Total available-for-sale debt securities (3) 228,238 6,384 (131) 234,491
Other debt securities carried at fair value (2) 11,720 429 (39) 12,110
Total debt securities carried at fair value 239,958 6,813 (170) 246,601
Held-to-maturity debt securities, substantially all U.S. agency mortgage-backed securities (3) 438,279 10,095 (194) 448,180
Total debt securities (3,4) $ 678,237 $ 16,908 $ (364) $ 694,781
December 31, 2019

Available-for-sale debt securities
Agency $ 121,698 $ 1,013 $ (183) $ 122,528
Agency-collateralized mortgage obligations 4,587 78 (24) 4,641
Commercial 14,797 249 (25) 15,021
Non-agency residential (1) 948 138 (9) 1,077
Total mortgage-backed securities 142,030 1,478 (241) 143,267
U.S. Treasury and agency securities 67,700 1,023 (195) 68,528
Non-U.S. securities 11,987 6 (2) 11,991
Other taxable securities, substantially all asset-backed securities 3,874 67 — 3,941
Total taxable securities 225,591 2,574 (438) 227,727
Tax-exempt securities 17,716 202 (6) 17,912
Total available-for-sale debt securities 243,307 2,776 (444) 245,639
Other debt securities carried at fair value (2) 10,596 255 (23) 10,828
Total debt securities carried at fair value 253,903 3,031 (467) 256,467
Held-to-maturity debt securities, substantially all U.S. agency mortgage-backed securities 215,730 4,433 (342) 219,821
Total debt securities (3, 4) $ 469,633 $ 7,464 $ (809) $ 476,288
(1)
At December 31, 2020 and 2019, the underlying collateral type included approximately 37 percent and 49 percent prime, two percent and six percent Alt-A and 61 percent and 45 percent
subprime.
(2)
Primarily includes non-U.S. securities used to satisfy certain international regulatory requirements. Any changes in value are reported in market making and similar activities. For detail on the
components, see Note 20 – Fair Value Measurements.
(3)
Includes securities pledged as collateral of $65.5 billion and $67.0 billion at December 31, 2020 and 2019.
(4)
The Corporation held debt securities from FNMA and FHLMC that each exceeded 10 percent of shareholders’ equity, with an amortized cost of $260.1 billion and $118.1 billion, and a fair value of
$267.5 billion and $120.7 billion at December 31, 2020, and an amortized cost of $157.2 billion and $54.1 billion, and a fair value of $160.6 billion and $55.1 billion at December 31, 2019.
At December 31, 2020, the accumulated net unrealized gain U.S. agency and U.S. Treasury securities that have a zero credit
on AFS debt securities, excluding the amount related to debt loss assumption. For the remaining $34.5 billion in AFS debt
securities previously transferred to held to maturity, included in securities, the amount of ECL was insignificant. Substantially all
accumulated OCI was $4.7 billion, net of the related income tax of the Corporation's HTM debt securities are U.S. agency and
expense of $1.6 billion. The Corporation had nonperforming AFS U.S. Treasury securities and have a zero credit loss assumption.
debt securities of $20 million and $9 million at December 31, At December 31, 2020 and 2019, the Corporation held
2020 and 2019. equity securities at an aggregate fair value of $769 million and
Effective January 1, 2020, the Corporation adopted the new $891 million and other equity securities, as valued under the
accounting standard for credit losses that requires evaluation of measurement alternative, at a carrying value of $240 million
AFS and HTM debt securities for any expected losses with and $183 million, both of which are included in other assets. At
recognition of an allowance for credit losses, when applicable. December 31, 2020 and 2019, the Corporation also held
For more information, see Note 1 – Summary of Significant money market investments at a fair value of $1.6 billion and
Accounting Principles. At December 31, 2020, the Corporation $1.0 billion, which are included in time deposits placed and
had $200.0 billion in AFS debt securities, which were primarily other short-term investments.


02.25.2021 22:55PM 62539
The gross realized gains and losses on sales of AFS debt securities for 2020, 2019 and 2018 are presented in the table below.
Gains and Losses on Sales of AFS Debt Securities

Gross gains $ 423 $ 336 $ 169
Gross losses (12) (119) (15)
Net gains on sales of AFS debt securities $ 411 $ 217 $ 154
Income tax expense attributable to realized net gains on sales of AFS debt securities $ 103 $ 54 $ 37
The table below presents the fair value and the associated gross unrealized losses on AFS debt securities and whether these
securities have had gross unrealized losses for less than 12 months or for 12 months or longer at December 31, 2020 and 2019.
Total AFS Debt Securities in a Continuous Unrealized Loss Position

Less than Twelve Months Twelve Months or Longer Total
Gross Gross Gross
Fair Unrealized Fair Unrealized Fair Unrealized
Value Losses Value Losses Value Losses
Continuously unrealized loss-positioned AFS debt securities
Agency $ 2,841 $ (39) $ 2 $ — $ 2,843 $ (39)
Agency-collateralized mortgage obligations 187 (2) 364 (11) 551 (13)
Commercial 566 (4) 9 — 575 (4)
Non-agency residential 342 (9) 56 (8) 398 (17)
Total mortgage-backed securities 3,936 (54) 431 (19) 4,367 (73)
U.S. Treasury and agency securities 8,282 (9) 498 (4) 8,780 (13)
Non-U.S. securities 1,861 (6) 135 (1) 1,996 (7)
Other taxable securities, substantially all asset-backed securities 576 (2) 396 (4) 972 (6)
Total taxable securities 14,655 (71) 1,460 (28) 16,115 (99)
Tax-exempt securities 4,108 (29) 617 (3) 4,725 (32)
Total AFS debt securities in a continuous
unrealized loss position $ 18,763 $ (100) $ 2,077 $ (31) $ 20,840 $ (131)
December 31, 2019

Continuously unrealized loss-positioned AFS debt securities
Agency $ 17,641 $ (41) $ 17,238 $ (142) $ 34,879 $ (183)
Agency-collateralized mortgage obligations 255 (1) 925 (23) 1,180 (24)
Commercial 2,180 (22) 442 (3) 2,622 (25)
Non-agency residential 122 (6) 22 (3) 144 (9)
Total mortgage-backed securities 20,198 (70) 18,627 (171) 38,825 (241)
U.S. Treasury and agency securities 12,836 (71) 18,866 (124) 31,702 (195)
Non-U.S. securities 851 — 837 (2) 1,688 (2)
Other taxable securities, substantially all asset-backed securities 938 — 222 — 1,160 —
Total taxable securities 34,823 (141) 38,552 (297) 73,375 (438)
Tax-exempt securities 4,286 (5) 190 (1) 4,476 (6)
Total AFS debt securities in a continuous
unrealized loss position $ 39,109 $ (146) $ 38,742 $ (298) $ 77,851 $ (444)


02.25.2021 22:55PM 62539
The remaining contractual maturity distribution and yields of the Corporation’s debt securities carried at fair value and HTM debt
securities at December 31, 2020 are summarized in the table below. Actual duration and yields may differ as prepayments on the
loans underlying the mortgages or other ABS are passed through to the Corporation.
Maturities of Debt Securities Carried at Fair Value and Held-to-maturity Debt Securities
Due in One Due after One Year Due after Five Years Due after
Year or Less through Five Years through Ten Years Ten Years Total
(1) (1) (1)
(Dollars in millions) Amount Yield Amount Yield Amount Yield Amount Yield (1) Amount Yield (1)
Amortized cost of debt securities carried at fair value
Agency $ — —% $ 7 5.69 % $ 56 4.44 % $ 59,455 3.36 % $ 59,518 3.36 %
Agency-collateralized mortgage obligations — — — — 24 2.57 5,088 2.94 5,112 2.94
Commercial 26 3.04 6,669 2.52 7,711 2.32 1,077 2.64 15,483 2.43
Non-agency residential — — — — 1 — 1,620 6.77 1,621 6.77
Total mortgage-backed securities 26 3.04 6,676 2.52 7,792 2.34 67,240 3.40 81,734 3.23
U.S. Treasury and agency securities 10,020 1.26 29,533 1.85 74,665 0.74 32 2.55 114,250 1.07
Non-U.S. securities 22,862 0.31 926 1.81 581 1.09 532 1.79 24,901 0.42
Other taxable securities, substantially all asset-backed
securities 699 1.15 1,336 2.46 366 2.26 255 1.60 2,656 2.00
Total taxable securities 33,607 0.61 38,471 1.99 83,404 0.89 68,059 3.38 223,541 1.80
Tax-exempt securities 872 0.87 8,430 1.27 4,397 1.66 2,718 1.41 16,417 1.38
Total amortized cost of debt securities carried at
fair value $ 34,479 0.62 $ 46,901 1.86 $ 87,801 0.93 $ 70,777 3.30 $ 239,958 1.77
Amortized cost of HTM debt securities (2) $ 15 3.78 $ 66 2.73 $ 17,133 1.86 $ 421,065 2.40 $ 438,279 2.38
Debt securities carried at fair value

Agency $ — $ 7 $ 61 $ 61,781 $ 61,849
Agency-collateralized mortgage obligations — — 24 5,236 5,260
Commercial 26 7,077 8,242 1,160 16,505
Non-agency residential — — 7 1,776 1,783
Total mortgage-backed securities 26 7,084 8,334 69,953 85,397
U.S. Treasury and agency securities 10,056 30,873 75,511 33 116,473
Non-U.S. securities 23,187 940 582 534 25,243
Other taxable securities, substantially all asset-backed
securities 702 1,369 379 264 2,714
Total taxable securities 33,971 40,266 84,806 70,784 229,827
Tax-exempt securities 874 8,554 4,566 2,780 16,774
Total debt securities carried at fair value $ 34,845 $ 48,820 $ 89,372 $ 73,564 $ 246,601
Fair value of HTM debt securities (2) $ 14 $ 69 $ 17,139 $ 430,958 $ 448,180
(1)
The weighted-average yield is computed based on a constant effective interest rate over the contractual life of each security. The average yield considers the contractual coupon and the
amortization of premiums and accretion of discounts, excluding the effect of related hedging derivatives.
(2)
Substantially all U.S. agency MBS.


02.25.2021 22:55PM 62539
NOTE 5 Outstanding Loans and Leases and Allowance for Credit Losses
The following tables present total outstanding loans and leases and an aging analysis for the Consumer Real Estate, Credit Card
and Other Consumer, and Commercial portfolio segments, by class of financing receivables, at December 31, 2020 and 2019.
Loans
Total Current Accounted
90 Days or Total Past or Less Than for Under the
30-59 Days 60-89 Days More Due 30 Days 30 Days Fair Value Total
Past Due (1) Past Due (1) Past Due (1) or More Past Due (1) Option Outstandings
Consumer real estate
Core portfolio
Residential mortgage $ 1,157 $ 175 $ 786 $ 2,118 $ 213,155 $ 215,273
Home equity 126 61 269 456 29,872 30,328
Non-core portfolio
Residential mortgage 273 122 913 1,308 6,974 8,282
Home equity 28 17 76 121 3,862 3,983
Credit card and other consumer
Credit card 445 341 903 1,689 77,019 78,708
Direct/Indirect consumer (2) 209 67 37 313 91,050 91,363
Other consumer — — — — 124 124
Total consumer 2,238 783 2,984 6,005 422,056 428,061
Consumer loans accounted for under the fair value
option (3) $ 735 735
Total consumer loans and leases 2,238 783 2,984 6,005 422,056 735 428,796
Commercial
U.S. commercial 561 214 512 1,287 287,441 288,728
Non-U.S. commercial 61 44 11 116 90,344 90,460
Commercial real estate (4) 128 113 226 467 59,897 60,364
Commercial lease financing 86 20 57 163 16,935 17,098
U.S. small business commercial (5) 84 56 123 263 36,206 36,469
Total commercial 920 447 929 2,296 490,823 493,119
Commercial loans accounted for under the fair value
option (3) 5,946 5,946
Total commercial loans and leases 920 447 929 2,296 490,823 5,946 499,065
Total loans and leases (6) $ 3,158 $ 1,230 $ 3,913 $ 8,301 $ 912,879 $ 6,681 $ 927,861
Percentage of outstandings 0.34 % 0.13 % 0.42 % 0.89 % 98.39 % 0.72 % 100.00 %
(1)
Consumer real estate loans 30-59 days past due includes fully-insured loans of $225 million and nonperforming loans of $126 million. Consumer real estate loans 60-89 days past due includes
fully-insured loans of $103 million and nonperforming loans of $95 million. Consumer real estate loans 90 days or more past due includes fully-insured loans of $762 million. Consumer real
estate loans current or less than 30 days past due includes $1.2 billion and direct/indirect consumer includes $66 million of nonperforming loans. For information on the Corporation's interest
accrual policies and delinquency status for loan modifications related to the pandemic, see Note 1 – Summary of Significant Accounting Principles.
(2)
Total outstandings primarily includes auto and specialty lending loans and leases of $46.4 billion, U.S. securities-based lending loans of $41.1 billion and non-U.S. consumer loans of $3.0 billion.
(3)
Consumer loans accounted for under the fair value option includes residential mortgage loans of $298 million and home equity loans of $437 million. Commercial loans accounted for under the
fair value option includes U.S. commercial loans of $2.9 billion and non-U.S. commercial loans of $3.0 billion. For more information, see Note 20 – Fair Value Measurements and Note 21 – Fair
Value Option.
(4)
Total outstandings includes U.S. commercial real estate loans of $57.2 billion and non-U.S. commercial real estate loans of $3.2 billion.
(5)
Includes PPP loans.
(6)
Total outstandings includes loans and leases pledged as collateral of $15.5 billion. The Corporation also pledged $153.1 billion of loans with no related outstanding borrowings to secure
potential borrowing capacity with the Federal Reserve Bank and Federal Home Loan Bank.


02.25.2021 22:55PM 62539
Total Loans
Total Past Current or Accounted
90 Days or Due 30 Less Than for Under
30-59 Days 60-89 Days More Days 30 Days the Fair Total
Past Due (1) Past Due (1) Past Due (1)
or More Past Due (1) Value Option Outstandings
Consumer real estate
Core portfolio
Residential mortgage $ 1,378 $ 261 $ 565 $ 2,204 $ 223,566 $ 225,770
Home equity 135 70 198 403 34,823 35,226
Non-core portfolio
Residential mortgage 458 209 1,263 1,930 8,469 10,399
Home equity 34 16 72 122 4,860 4,982
Credit card and other consumer
Credit card 564 429 1,042 2,035 95,573 97,608
Direct/Indirect consumer (2) 297 85 35 417 90,581 90,998
Other consumer — — — — 192 192
Total consumer 2,866 1,070 3,175 7,111 458,064 465,175
Consumer loans accounted for under the fair value
option (3) $ 594 594
Total consumer loans and leases 2,866 1,070 3,175 7,111 458,064 594 465,769
Commercial
U.S. commercial 788 279 371 1,438 305,610 307,048
Non-U.S. commercial 35 23 8 66 104,900 104,966
Commercial real estate (4) 144 19 119 282 62,407 62,689
Commercial lease financing 100 56 39 195 19,685 19,880
U.S. small business commercial 119 56 107 282 15,051 15,333
Total commercial 1,186 433 644 2,263 507,653 509,916
Commercial loans accounted for under the fair value
option (3) 7,741 7,741
Total commercial loans and leases 1,186 433 644 2,263 507,653 7,741 517,657
Total loans and leases (5) $ 4,052 $ 1,503 $ 3,819 $ 9,374 $ 965,717 $ 8,335 $ 983,426
Percentage of outstandings 0.41 % 0.15 % 0.39 % 0.95 % 98.20 % 0.85 % 100.00 %
(1)
Consumer real estate loans 30-59 days past due includes fully-insured loans of $517 million and nonperforming loans of $139 million. Consumer real estate loans 60-89 days past due includes
fully-insured loans of $206 million and nonperforming loans of $114 million. Consumer real estate loans 90 days or more past due includes fully-insured loans of $1.1 billion. Consumer real
estate loans current or less than 30 days past due includes $856 million and direct/indirect consumer includes $45 million of nonperforming loans.
(2)
Total outstandings primarily includes auto and specialty lending loans and leases of $50.4 billion, U.S. securities-based lending loans of $36.7 billion and non-U.S. consumer loans of $2.8 billion.
(3)
Consumer loans accounted for under the fair value option includes residential mortgage loans of $257 million and home equity loans of $337 million. Commercial loans accounted for under the
fair value option includes U.S. commercial loans of $4.7 billion and non-U.S. commercial loans of $3.1 billion. For more information, see Note 20 – Fair Value Measurements and Note 21 – Fair
Value Option.
(4)
Total outstandings includes U.S. commercial real estate loans of $59.0 billion and non-U.S. commercial real estate loans of $3.7 billion.
(5)
Total outstandings includes loans and leases pledged as collateral of $25.9 billion. The Corporation also pledged $168.2 billion of loans with no related outstanding borrowings to secure
potential borrowing capacity with the Federal Reserve Bank and Federal Home Loan Bank.
The Corporation categorizes consumer real estate loans as Nonperforming Loans and Leases
core and non-core based on loan and customer characteristics Commercial nonperforming loans increased to $2.2 billion at
such as origination date, product type, LTV, Fair Isaac December 31, 2020 from $1.5 billion at December 31, 2019
Corporation (FICO) score and delinquency status consistent with with broad-based increases across multiple industries.
its current consumer and mortgage servicing strategy. Generally, Consumer nonperforming loans increased to $2.7 billion at
loans that were originated after January 1, 2010, qualified December 31, 2020 from $2.1 billion at December 31, 2019
under government-sponsored enterprise (GSE) underwriting driven by deferral activity, as well as the inclusion of
guidelines, or otherwise met the Corporation’s underwriting $144 million of certain loans that were previously classified as
guidelines in place in 2015 are characterized as core loans. All purchased credit-impaired loans and accounted for under a pool
other loans are generally characterized as non-core loans and basis.
represent runoff portfolios. The table below presents the Corporation’s nonperforming
The Corporation has entered into long-term credit protection loans and leases including nonperforming TDRs, and loans
agreements with FNMA and FHLMC on loans totaling $9.0 billion accruing past due 90 days or more at December 31, 2020 and
and $7.5 billion at December 31, 2020 and 2019, providing full 2019. Nonperforming LHFS are excluded from nonperforming
credit protection on residential mortgage loans that become loans and leases as they are recorded at either fair value or the
severely delinquent. All of these loans are individually insured, lower of cost or fair value. For information on the Corporation's
and therefore the Corporation does not record an allowance for interest accrual policies, delinquency status for loan
credit losses related to these loans. modifications related to the pandemic and the criteria for
classification as nonperforming, see Note 1 – Summary of
Significant Accounting Principles.


02.25.2021 22:55PM 62539
Credit Quality
Nonperforming Loans Accruing Past Due
and Leases 90 Days or More (1)
December 31
(2)
Residential mortgage $ 2,005 $ 1,470 $ 762 $ 1,088
With no related allowance (3) 1,378 n/a — —
Home equity (2) 649 536 — —
With no related allowance (3) 347 n/a — —
Credit Card n/a n/a 903 1,042
Direct/indirect consumer 71 47 33 33
Total consumer 2,725 2,053 1,698 2,163
U.S. commercial 1,243 1,094 228 106
Non-U.S. commercial 418 43 10 8
Commercial real estate 404 280 6 19
Commercial lease financing 87 32 25 20
U.S. small business commercial 75 50 115 97
Total commercial 2,227 1,499 384 250
Total nonperforming loans $ 4,952 $ 3,552 $ 2,082 $ 2,413
Percentage of outstanding loans and leases 0.54 % 0.36 % 0.23 % 0.25 %
(1)
For information on the Corporation's interest accrual policies and delinquency status for loan modifications related to the pandemic, see Note 1 – Summary of Significant Accounting Principles.
(2)
Residential mortgage loans accruing past due 90 days or more are fully-insured loans. At December 31, 2020 and 2019 residential mortgage includes $537 million and $740 million of loans on
which interest had been curtailed by the FHA, and therefore were no longer accruing interest, although principal was still insured, and $225 million and $348 million of loans on which interest was
still accruing.
(3)
Primarily relates to loans for which the estimated fair value of the underlying collateral less any costs to sell is greater than the amortized cost of the loans as of the reporting date.
Included in the December 31, 2020 nonperforming loans are frequently. Certain borrowers (e.g., borrowers that have had
$127 million and $17 million of residential mortgage and home debts discharged in a bankruptcy proceeding) may not have their
equity loans that prior to the January 1, 2020 adoption of the FICO scores updated. FICO scores are also a primary credit
new credit loss standard were not included in nonperforming quality indicator for the Credit Card and Other Consumer
loans, as they were previously classified as purchased credit- portfolio segment and the business card portfolio within U.S.
impaired loans and accounted for under a pool basis. small business commercial. Within the Commercial portfolio
segment, loans are evaluated using the internal classifications
Credit Quality Indicators of pass rated or reservable criticized as the primary credit
The Corporation monitors credit quality within its Consumer Real quality indicators. The term reservable criticized refers to those
Estate, Credit Card and Other Consumer, and Commercial commercial loans that are internally classified or listed by the
portfolio segments based on primary credit quality indicators. Corporation as Special Mention, Substandard or Doubtful, which
For more information on the portfolio segments, see Note 1 – are asset quality categories defined by regulatory authorities.
Summary of Significant Accounting Principles. Within the These assets have an elevated level of risk and may have a
Consumer Real Estate portfolio segment, the primary credit high probability of default or total loss. Pass rated refers to all
quality indicators are refreshed LTV and refreshed FICO score. loans not considered reservable criticized. In addition to these
Refreshed LTV measures the carrying value of the loan as a primary credit quality indicators, the Corporation uses other
percentage of the value of the property securing the loan, credit quality indicators for certain types of loans.
refreshed quarterly. Home equity loans are evaluated using The following tables present certain credit quality indicators
CLTV, which measures the carrying value of the Corporation’s for the Corporation's Consumer Real Estate, Credit Card and
loan and available line of credit combined with any outstanding Other Consumer, and Commercial portfolio segments by class
senior liens against the property as a percentage of the value of of financing receivables and year of origination for term loan
the property securing the loan, refreshed quarterly. FICO score balances at December 31, 2020, including revolving loans that
measures the creditworthiness of the borrower based on the converted to term loans without an additional credit decision
financial obligations of the borrower and the borrower’s credit after origination or through a TDR.
history. FICO scores are typically refreshed quarterly or more


02.25.2021 22:55PM 62539
Residential Mortgage – Credit Quality Indicators By Vintage

Term Loans by Origination Year
Total as of
December 31,
(Dollars in millions) 2020 2020 2019 2018 2017 2016 Prior
Total Residential Mortgage
Refreshed LTV
Less than or equal to 90 percent $ 207,389 $ 68,907 $ 43,771 $ 14,658 $ 21,589 $ 22,967 $ 35,497
Greater than 90 percent but less than or equal to 100
percent 3,138 1,970 684 128 70 96 190
Greater than 100 percent 1,210 702 174 47 39 37 211
Fully-insured loans 11,818 3,826 2,014 370 342 1,970 3,296
Total Residential Mortgage $ 223,555 $ 75,405 $ 46,643 $ 15,203 $ 22,040 $ 25,070 $ 39,194
Total Residential Mortgage

Refreshed FICO score
Less than 620 $ 2,717 $ 823 $ 177 $ 139 $ 170 $ 150 $ 1,258
Greater than or equal to 620 and less than 680 5,462 1,804 666 468 385 368 1,771
Greater than or equal to 680 and less than 740 25,349 8,533 4,679 1,972 2,427 2,307 5,431
Greater than or equal to 740 178,209 60,419 39,107 12,254 18,716 20,275 27,438
Fully-insured loans 11,818 3,826 2,014 370 342 1,970 3,296
Total Residential Mortgage $ 223,555 $ 75,405 $ 46,643 $ 15,203 $ 22,040 $ 25,070 $ 39,194
Home Equity - Credit Quality Indicators
Home Equity Revolving

Loans and Loans
Reverse Revolving Converted to
Total Mortgages (1) Loans Term Loans
Total Home Equity
Refreshed LTV
Less than or equal to 90 percent $ 33,447 $ 1,919 $ 22,639 $ 8,889
Greater than 90 percent but less than or equal to 100 percent 351 126 94 131
Greater than 100 percent 513 172 118 223
Total Home Equity $ 34,311 $ 2,217 $ 22,851 $ 9,243
Total Home Equity

Less than 620 $ 1,082 $ 250 $ 244 $ 588
Greater than or equal to 620 and less than 680 1,798 263 568 967
Greater than or equal to 680 and less than 740 5,762 556 2,905 2,301
Greater than or equal to 740 25,669 1,148 19,134 5,387
Total Home Equity $ 34,311 $ 2,217 $ 22,851 $ 9,243
(1)
Includes reverse mortgages of $1.3 billion and home equity loans of $885 million which are no longer originated.
Credit Card and Direct/Indirect Consumer – Credit Quality Indicators By Vintage

Direct/Indirect
Term Loans by Origination Year Credit Card
Revolving
Total Direct/ Total Credit Loans
Indirect as of Card as of Converted
December 31, Revolving December 31, Revolving to Term
(Dollars in millions) 2020 Loans 2020 2019 2018 2017 2016 Prior 2020 Loans Loans (3)
Less than 620 $ 959 $ 19 $ 111 $ 200 $ 175 $ 243 $ 148 $ 63 $ 4,018 $ 3,832 $ 186
Greater than or equal to 620
and less than 680 2,143 20 653 559 329 301 176 105 9,419 9,201 218
Greater than or equal to 680
and less than 740 7,431 80 2,848 2,015 1,033 739 400 316 27,585 27,392 193
Greater than or equal to 740 36,064 120 12,540 10,588 5,869 3,495 1,781 1,671 37,686 37,642 44
Other internal credit
metrics (1, 2) 44,766 44,098 74 115 84 67 52 276 — — —
Total credit card and other
consumer $ 91,363 $ 44,337 $ 16,226 $ 13,477 $ 7,490 $ 4,845 $ 2,557 $ 2,431 $ 78,708 $ 78,067 $ 641
(1)
Other internal credit metrics may include delinquency status, geography or other factors.
(2)
Direct/indirect consumer includes $44.1 billion of securities-based lending which is typically supported by highly liquid collateral with market value greater than or equal to the outstanding loan
balance and therefore has minimal credit risk at December 31, 2020.
(3)
Represents TDRs that were modified into term loans.


02.25.2021 22:55PM 62539
Commercial – Credit Quality Indicators By Vintage (1, 2)

Term Loans
Amortized Cost Basis by Origination Year
Total as of
December 31, Revolving
(Dollars in millions) 2020 2020 2019 2018 2017 2016 Prior Loans
U.S. Commercial
Risk ratings
Pass rated $ 268,812 $ 33,456 $ 33,305 $ 17,363 $ 14,102 $ 7,420 $ 21,784 $ 141,382
Reservable criticized 19,916 2,524 2,542 2,689 854 698 1,402 9,207
Total U.S. Commercial $ 288,728 $ 35,980 $ 35,847 $ 20,052 $ 14,956 $ 8,118 $ 23,186 $ 150,589
Non-U.S. Commercial
Risk ratings
Pass rated $ 85,914 $ 16,301 $ 11,396 $ 7,451 $ 5,037 $ 1,674 $ 2,194 $ 41,861
Reservable criticized 4,546 914 572 492 436 138 259 1,735
Total Non-U.S. Commercial $ 90,460 $ 17,215 $ 11,968 $ 7,943 $ 5,473 $ 1,812 $ 2,453 $ 43,596
Commercial Real Estate

Risk ratings
Pass rated $ 50,260 $ 8,429 $ 14,126 $ 8,228 $ 4,599 $ 3,299 $ 6,542 $ 5,037
Reservable criticized 10,104 933 2,558 2,115 1,582 606 1,436 874
Total Commercial Real Estate $ 60,364 $ 9,362 $ 16,684 $ 10,343 $ 6,181 $ 3,905 $ 7,978 $ 5,911
Commercial Lease Financing

Risk ratings
Pass rated $ 16,384 $ 3,083 $ 3,242 $ 2,956 $ 2,532 $ 1,703 $ 2,868 $ —
Reservable criticized 714 117 117 132 81 88 179 —
Total Commercial Lease Financing $ 17,098 $ 3,200 $ 3,359 $ 3,088 $ 2,613 $ 1,791 $ 3,047 $ —
U.S. Small Business Commercial (3)

Risk ratings
Pass rated $ 28,786 $ 24,539 $ 1,121 $ 837 $ 735 $ 527 $ 855 $ 172
Reservable criticized 1,148 76 239 210 175 113 322 13
Total U.S. Small Business Commercial $ 29,934 $ 24,615 $ 1,360 $ 1,047 $ 910 $ 640 $ 1,177 $ 185
Total (1, 2) $ 486,584 $ 90,372 $ 69,218 $ 42,473 $ 30,133 $ 16,266 $ 37,841 $ 200,281
(1)
Excludes $5.9 billion of loans accounted for under the fair value option at December 31, 2020.
(2)
Includes $58 million of loans that converted from revolving to term loans.
(3)
Excludes U.S. Small Business Card loans of $6.5 billion. Refreshed FICO scores for this portfolio are $265 million for less than 620; $582 million for greater than or equal to 620 and less than
680; $1.7 billion for greater than or equal to 680 and less than 740; and $3.9 billion greater than or equal to 740.
Due to the economic impact of COVID-19, commercial asset modified payment terms. Upon successful completion of the
quality weakened during 2020. Commercial reservable criticized trial period, the Corporation and the borrower enter into a
utilized exposure increased to $38.7 billion at December 31, permanent modification. Binding trial modifications are
2020 from $11.5 billion (to 7.31 percent from 2.09 percent of classified as TDRs when the trial offer is made and continue to
total commercial reservable utilized exposure) at December 31, be classified as TDRs regardless of whether the borrower enters
2019 with increases spread across multiple industries, into a permanent modification.
including travel and entertainment. Consumer real estate loans of $372 million that have been
discharged in Chapter 7 bankruptcy with no change in
Troubled Debt Restructurings repayment terms and not reaffirmed by the borrower were
The Corporation has been entering into loan modifications with included in TDRs at December 31, 2020, of which $102 million
borrowers in response to the pandemic, most of which are not were classified as nonperforming and $68 million were loans
classified as TDRs, and therefore are not included in the fully insured.
discussion below. For more information on the criteria for Consumer real estate TDRs are measured primarily based on
classifying loans as TDRs, see Note 1 – Summary of Significant the net present value of the estimated cash flows discounted at
Accounting Principles. the loan’s original effective interest rate. If the carrying value of
a TDR exceeds this amount, a specific allowance is recorded as
Consumer Real Estate a component of the allowance for loan and lease losses.
Modifications of consumer real estate loans are classified as Alternatively, consumer real estate TDRs that are considered to
TDRs when the borrower is experiencing financial difficulties and be dependent solely on the collateral for repayment (e.g., due to
a concession has been granted. Concessions may include the lack of income verification) are measured based on the
reductions in interest rates, capitalization of past due amounts, estimated fair value of the collateral, and a charge-off is
principal and/or interest forbearance, payment extensions, recorded if the carrying value exceeds the fair value of the
principal and/or interest forgiveness, or combinations thereof. collateral. Consumer real estate loans that reach 180 days past
Prior to permanently modifying a loan, the Corporation may enter due prior to modification are charged off to their net realizable
into trial modifications with certain borrowers under both value, less costs to sell, before they are modified as TDRs in
government and proprietary programs. Trial modifications accordance with established policy. Subsequent declines in the
generally represent a three- to four-month period during which fair value of the collateral after a loan has reached 180 days
the borrower makes monthly payments under the anticipated past due are recorded as charge-offs. Fully-insured loans are


02.25.2021 22:55PM 62539
protected against principal loss, and therefore, the Corporation loans completed or which were in process prior to the pause in
does not record an allowance for loan and lease losses on the foreclosures, to foreclosed properties or, for properties acquired
outstanding principal balance, even after they have been upon foreclosure of certain government-guaranteed loans
modified in a TDR. (principally FHA-insured loans), to other assets. The
At December 31, 2020 and 2019, remaining commitments reclassifications represent non-cash investing activities and,
to lend additional funds to debtors whose terms have been accordingly, are not reflected in the Consolidated Statement of
modified in a consumer real estate TDR were not significant. Cash Flows.
Consumer real estate foreclosed properties totaled $123 million The table below presents the December 31, 2020, 2019
and $229 million at December 31, 2020 and 2019. The and 2018 unpaid principal balance, carrying value, and average
carrying value of consumer real estate loans, including fully- pre- and post-modification interest rates of consumer real estate
insured loans, for which formal foreclosure proceedings were in loans that were modified in TDRs during 2020, 2019 and 2018.
process at December 31, 2020 was $1.2 billion. Although the The following Consumer Real Estate portfolio segment tables
Corporation has paused formal loan foreclosure proceedings include loans that were initially classified as TDRs during the
and foreclosure sales for occupied properties, during 2020, the period and also loans that had previously been classified as
Corporation reclassified $182 million of consumer real estate TDRs and were modified again during the period.
Consumer Real Estate – TDRs Entered into During 2020, 2019 and 2018 (1)
Post-
Unpaid Principal Carrying Pre-Modification Modification
Balance Value Interest Rate Interest Rate (2)
Residential mortgage $ 732 $ 646 3.66 % 3.59 %
Home equity 87 69 3.67 3.61
Total $ 819 $ 715 3.66 3.59
December 31, 2019

Home equity 141 101 5.04 4.31
Total $ 605 $ 478 4.39 4.17
December 31, 2018

Home equity 489 358 4.46 3.74
Total $ 1,263 $ 999 4.38 4.03
(1)
For more information on the Corporation's loan modification programs offered in response to the pandemic, most of which are not TDRs, see Note 1 – Summary of Significant Accounting Principles.
(2)
The post-modification interest rate reflects the interest rate applicable only to permanently completed modifications, which exclude loans that are in a trial modification period.
The table below presents the December 31, 2020, 2019 and 2018 carrying value for consumer real estate loans that were
modified in a TDR during 2020, 2019 and 2018, by type of modification.
Consumer Real Estate – Modification Programs (1)

TDRs Entered into During
Modifications under government programs $ 13 $ 35 $ 61
Modifications under proprietary programs 570 174 523
Loans discharged in Chapter 7 bankruptcy (2) 53 68 130
Trial modifications 79 201 285
Total modifications $ 715 $ 478 $ 999
(1)
(2)
Includes loans discharged in Chapter 7 bankruptcy with no change in repayment terms that are classified as TDRs.
The table below presents the carrying value of consumer real estate loans that entered into payment default during 2020, 2019
and 2018 that were modified in a TDR during the 12 months preceding payment default. A payment default for consumer real estate
TDRs is recognized when a borrower has missed three monthly payments (not necessarily consecutively) since modification.
Consumer Real Estate – TDRs Entering Payment Default that were Modified During the Preceding 12 Months (1)
Modifications under government programs $ 16 $ 26 $ 39
Modifications under proprietary programs 51 88 158
Loans discharged in Chapter 7 bankruptcy (2) 19 30 64
Trial modifications (3) 54 57 107
Total modifications $ 140 $ 201 $ 368
(1)
(2)
Includes loans discharged in Chapter 7 bankruptcy with no change in repayment terms that are classified as TDRs.
(3)
Includes trial modification offers to which the customer did not respond.


02.25.2021 22:55PM 62539
Credit Card and Other Consumer agencies that provide solutions to customers’ entire unsecured
The Corporation seeks to assist customers that are debt structures (external programs). The Corporation classifies
experiencing financial difficulty by modifying loans while other secured consumer loans that have been discharged in
ensuring compliance with federal and local laws and guidelines. Chapter 7 bankruptcy as TDRs, which are written down to
Credit card and other consumer loan modifications generally collateral value and placed on nonaccrual status no later than
involve reducing the interest rate on the account, placing the the time of discharge.
customer on a fixed payment plan not exceeding 60 months and The table below provides information on the Corporation’s
canceling the customer’s available line of credit, all of which are Credit Card and Other Consumer TDR portfolio including the
considered TDRs. The Corporation makes loan modifications December 31, 2020, 2019 and 2018 unpaid principal balance,
directly with borrowers for debt held only by the Corporation carrying value, and average pre- and post-modification interest
(internal programs). Additionally, the Corporation makes loan rates of loans that were modified in TDRs during 2020, 2019
modifications for borrowers working with third-party renegotiation and 2018.
Credit Card and Other Consumer – TDRs Entered into During 2020, 2019 and 2018 (1)
Post-
Unpaid Principal Carrying Pre-Modification Modification
Balance Value (2) Interest Rate Interest Rate
Credit card $ 269 $ 277 18.16 % 5.63 %
Total $ 321 $ 314 16.70 5.65
December 31, 2019

Credit card $ 340 $ 355 19.18 % 5.35 %
Total $ 380 $ 376 18.42 5.34
December 31, 2018

Credit card $ 278 $ 292 19.49 % 5.24 %
Total $ 320 $ 315 18.45 5.22
(1)
(2)
Includes accrued interest and fees.
The table below presents the December 31, 2020, 2019 and 2018 carrying value for Credit Card and Other Consumer loans that
were modified in a TDR during 2020, 2019 and 2018, by program type.
Credit Card and Other Consumer – TDRs by Program Type at December 31 (1)
Internal programs $ 225 $ 247 $ 199
External programs 73 108 93
Other 16 21 23
Total $ 314 $ 376 $ 315
(1)
Includes accrued interest and fees. For more information on the Corporation's loan modification programs offered in response to the pandemic, most of which are not TDRs, see Note 1 –
Summary of Significant Accounting Principles.
Credit card and other consumer loans are deemed to be in maturity at a concessionary (below market) rate of interest,
payment default during the quarter in which a borrower misses payment forbearances or other actions designed to benefit the
the second of two consecutive payments. Payment defaults are borrower while mitigating the Corporation’s risk exposure.
one of the factors considered when projecting future cash flows Reductions in interest rates are rare. Instead, the interest rates
in the calculation of the allowance for loan and lease losses for are typically increased, although the increased rate may not
credit card and other consumer. Based on historical experience, represent a market rate of interest. Infrequently, concessions
the Corporation estimates that 13 percent of new credit card may also include principal forgiveness in connection with
TDRs and 19 percent of new direct/indirect consumer TDRs may foreclosure, short sale or other settlement agreements leading
be in payment default within 12 months after modification. to termination or sale of the loan.
At the time of restructuring, the loans are remeasured to
Commercial Loans reflect the impact, if any, on projected cash flows resulting from
Modifications of loans to commercial borrowers that are the modified terms. If a portion of the loan is deemed to be
experiencing financial difficulty are designed to reduce the uncollectible, a charge-off may be recorded at the time of
Corporation’s loss exposure while providing the borrower with an restructuring. Alternatively, a charge-off may have already been
opportunity to work through financial difficulties, often to avoid
recorded in a previous period such that no charge-off is required

foreclosure or bankruptcy. Each modification is unique and at the time of modification. For more information on
reflects the individual circumstances of the borrower. modifications for the U.S. small business commercial portfolio,
Modifications that result in a TDR may include extensions of see Credit Card and Other Consumer in this Note.


02.25.2021 22:55PM 62539
At December 31, 2020 and 2019, the Corporation had $1.7 quality of the portfolio and an economic outlook over the life of
billion and $2.2 billion of commercial TDRs with remaining the loan. Qualitative reserves cover losses that are expected
commitments to lend additional funds to debtors of $402 but, in the Corporation's assessment, may not be adequately
million and $445 million. The balance of commercial TDRs in reflected in the quantitative methods or the economic
payment default was $218 million and $207 million at assumptions. The Corporation incorporates forward-looking
December 31, 2020 and 2019. information through the use of several macroeconomic
scenarios in determining the weighted economic outlook over
Loans Held-for-sale the forecasted life of the assets. These scenarios include key
The Corporation had LHFS of $9.2 billion at both December 31, macroeconomic variables such as gross domestic product,
2020 and 2019. Cash and non-cash proceeds from sales and unemployment rate, real estate prices and corporate bond
paydowns of loans originally classified as LHFS were $20.1 spreads. The scenarios that are chosen each quarter and the
billion, $30.6 billion and $29.2 billion for 2020, 2019 and weighting given to each scenario depend on a variety of factors
2018, respectively. Cash used for originations and purchases of including recent economic events, leading economic indicators,
LHFS totaled approximately $19.7 billion, $28.9 billion and internal and third-party economist views, and industry trends.
$28.1 billion for 2020, 2019 and 2018, respectively. As of January 1, 2020, to determine the allowance for credit
losses, the Corporation used a series of economic outlooks that
Accrued Interest Receivable resulted in an economic outlook that was weighted towards the
Accrued interest receivable for loans and leases and loans held- potential of a recession with some expectation of tail risk
for-sale at December 31, 2020 and 2019 was $2.4 billion and similar to the severely adverse scenario used in stress testing.
$2.6 billion and is reported in customer and other receivables Various economic outlooks were also used in the December 31,
on the Consolidated Balance Sheet. 2020 estimate for allowance for credit losses that included
Outstanding credit card loan balances include unpaid consensus estimates, multiple downside scenarios which
principal, interest and fees. Credit card loans are not classified assumed a significantly longer period until economic recovery, a
as nonperforming but are charged off no later than the end of tail risk scenario similar to the severely adverse scenario used
the month in which the account becomes 180 days past due, in stress testing and an upside scenario to reflect the potential
within 60 days after receipt of notification of death or for continued improvement in the consensus outlooks. The
bankruptcy, or upon confirmation of fraud. During 2020, the weighted economic outlook assumes that the U.S.
Corporation reversed $512 million of interest and fee income unemployment rate at the end of 2021 would be relatively
against the income statement line item in which it was originally consistent with the level as of December 2020, slightly above
recorded upon charge-off of the principal balance of the loan. 6.5 percent. Additionally, in this economic outlook, U.S. gross
For the outstanding residential mortgage, home equity, domestic product returns to pre-pandemic levels in the early part
direct/indirect consumer and commercial loan balances of 2022. The allowance for credit losses considers the impact
classified as nonperforming during 2020, the Corporation of enacted government stimulus, including the COVID-19
reversed $44 million of interest and fee income at the time the Emergency Relief Act of 2020, and continues to factor in the
loans were classified as nonperforming against the income unprecedented nature of the current health crisis.
statement line item in which it was originally recorded. For more The Corporation also factored into its allowance for credit
information on the Corporation's nonperforming loan policies, losses an estimated impact from higher-risk segments that
see Note 1 – Summary of Significant Accounting Principles. included leveraged loans and industries such as travel and
entertainment, which have been adversely impacted by the
Allowance for Credit Losses effects of COVID-19, as well as the energy sector. The
On January 1, 2020, the Corporation adopted the new Corporation also holds additional reserves for borrowers who
accounting standard that requires the measurement of the requested deferrals that take into account their credit
allowance for credit losses to be based on management’s best characteristics and payment behavior subsequent to deferral.
estimate of lifetime ECL inherent in the Corporation’s relevant The allowance for credit losses at December 31, 2020 was
financial assets. Upon adoption of the new accounting standard, $20.7 billion, an increase of $7.2 billion compared to
the Corporation recorded a $3.3 billion, or 32 percent, increase January 1, 2020. The increase in the allowance for credit losses
in the allowance for credit losses on January 1, 2020, which was driven by the deterioration in the economic outlook
was comprised of a net increase of $2.9 billion in the allowance resulting from the impact of COVID-19. The increase in the
for loan and lease losses and a $310 million increase in the allowance for credit losses was comprised of a net increase of
reserve for unfunded lending commitments. The net increase in $6.4 billion in the allowance for loan and lease losses and a
the allowance for loan and lease losses was primarily driven by $755 million increase in the reserve for unfunded lending
a $3.1 billion increase in credit card as the Corporation now commitments. The increase in the allowance for loan and lease
reserves for the life of these receivables. The increase in the losses was attributed to $418 million in the consumer real
reserve for unfunded lending commitments included $119 estate portfolio, $1.8 billion in the credit card and other
million in the consumer portfolio for the undrawn portion of consumer portfolio, and $4.2 billion in the commercial portfolio.
HELOCs and $191 million in the commercial portfolio. For more Outstanding loans and leases excluding loans accounted for
information on the Corporation's credit loss accounting policies under the fair value option decreased $53.9 billion in 2020,
including the allowance for credit losses see Note 1 – Summary driven by consumer loans, which decreased $37.1 billion
of Significant Accounting Principles. primarily due to a decline in credit card loans from reduced retail
The allowance for credit losses is estimated using spending and higher payments.
quantitative and qualitative methods that consider a variety of

factors, such as historical loss experience, the current credit


02.25.2021 22:55PM 62539
The changes in the allowance for credit losses, including net charge-offs and provision for loan and lease losses, are detailed in
the table below.
Consumer Credit Card and

Real Estate Other Consumer Commercial Total
(Dollars in millions) 2020
Allowance for loan and lease losses, January 1 $ 440 $ 7,430 $ 4,488 $ 12,358
Loans and leases charged off (98) (3,646) (1,675) (5,419)
Recoveries of loans and leases previously charged off 201 891 206 1,298
Net charge-offs 103 (2,755) (1,469) (4,121)
Provision for loan and lease losses 307 4,538 5,720 10,565
Other (1) 8 — (8) —
Allowance for loan and lease losses, December 31 858 9,213 8,731 18,802
Reserve for unfunded lending commitments, January 1 119 — 1,004 1,123
Provision for unfunded lending commitments 18 — 737 755
Reserve for unfunded lending commitments, December 31 137 — 1,741 1,878
Allowance for credit losses, December 31 $ 995 $ 9,213 $ 10,472 $ 20,680
2019
Allowance for loan and lease losses, January 1 $ 928 $ 3,874 $ 4,799 $ 9,601
Loans and leases charged off (522) (4,302) (822) (5,646)
Net charge-offs 405 (3,391) (662) (3,648)
Provision for loan and lease losses (680) 3,512 742 3,574
Other (1) (107) 1 (5) (111)
Reserve for unfunded lending commitments, January 1 — — 797 797
Provision for unfunded lending commitments — — 16 16
Reserve for unfunded lending commitments, December 31 — — 813 813
2018
Allowance for loan and lease losses, January 1 $ 1,720 $ 3,663 $ 5,010 $ 10,393
Loans and leases charged off (690) (4,037) (675) (5,402)
Net charge-offs (26) (3,214) (523) (3,763)
Provision for loan and lease losses (492) 3,441 313 3,262
Other (1) (274) (16) (1) (291)
Reserve for unfunded lending commitments, January 1 — — 777 777
Provision for unfunded lending commitments — — 20 20
Reserve for unfunded lending commitments, December 31 — — 797 797
(1)
Primarily represents write-offs of purchased credit-impaired loans in 2019, and the net impact of portfolio sales, transfers to held-for-sale and transfers to foreclosed properties.
NOTE 6 Securitizations and Other Variable present the Corporation’s maximum loss exposure at December
31, 2020 and 2019 resulting from its involvement with
Interest Entities consolidated VIEs and unconsolidated VIEs in which the
The Corporation utilizes VIEs in the ordinary course of business Corporation holds a variable interest. The Corporation’s
to support its own and its customers’ financing and investing maximum loss exposure is based on the unlikely event that all
needs. The Corporation routinely securitizes loans and debt of the assets in the VIEs become worthless and incorporates
securities using VIEs as a source of funding for the Corporation not only potential losses associated with assets recorded on
and as a means of transferring the economic risk of the loans or the Consolidated Balance Sheet but also potential losses
debt securities to third parties. The assets are transferred into a associated with off-balance sheet commitments, such as
trust or other securitization vehicle such that the assets are unfunded liquidity commitments and other contractual
legally isolated from the creditors of the Corporation and are not arrangements. The Corporation’s maximum loss exposure does
available to satisfy its obligations. These assets can only be not include losses previously recognized through write-downs of
used to settle obligations of the trust or other securitization assets.
vehicle. The Corporation also administers, structures or invests The Corporation invests in ABS issued by third-party VIEs
in other VIEs including CDOs, investment vehicles and other with which it has no other form of involvement and enters into
entities. For more information on the Corporation’s use of VIEs, certain commercial lending arrangements that may also
see Note 1 – Summary of Significant Accounting Principles. incorporate the use of VIEs, for example to hold collateral.
The tables in this Note present the assets and liabilities of These securities and loans are included in Note 4 – Securities or
consolidated and unconsolidated VIEs at December 31, 2020 Note 5 – Outstanding Loans and Leases and Allowance for Credit
and 2019 in situations where the Corporation has continuing Losses. In addition, the Corporation has used VIEs in connection
involvement with transferred assets or if the Corporation with its funding activities.
otherwise has a variable interest in the VIE. The tables also


02.25.2021 22:55PM 62539
The Corporation did not provide financial support to insured and U.S. Department of Veterans Affairs (VA)-
consolidated or unconsolidated VIEs during 2020, 2019 and guaranteed mortgage loans. Securitization usually occurs in
2018 that it was not previously contractually required to provide, conjunction with or shortly after origination or purchase, and the
nor does it intend to do so. Corporation may also securitize loans held in its residential
The Corporation had liquidity commitments, including written mortgage portfolio. In addition, the Corporation may, from time
put options and collateral value guarantees, with certain to time, securitize commercial mortgages it originates or
unconsolidated VIEs of $929 million and $1.1 billion at purchases from other entities. The Corporation typically services
December 31, 2020 and 2019. the loans it securitizes. Further, the Corporation may retain
beneficial interests in the securitization trusts including senior
First-lien Mortgage Securitizations and subordinate securities and equity tranches issued by the
As part of its mortgage banking activities, the Corporation trusts. Except as described in Note 12 – Commitments and
securitizes a portion of the first-lien residential mortgage loans Contingencies, the Corporation does not provide guarantees or
it originates or purchases from third parties, generally in the recourse to the securitization trusts other than standard
form of residential mortgage-backed securities (RMBS) representations and warranties.
guaranteed by government-sponsored enterprises, FNMA and The table below summarizes select information related to
FHLMC (collectively the GSEs), or the Government National first-lien mortgage securitizations for 2020, 2019 and 2018.
Mortgage Association (GNMA) primarily in the case of FHA-
First-lien Mortgage Securitizations

Residential Mortgage - Agency Commercial Mortgage
Proceeds from loan sales (1) $ 15,823 $ 6,858 $ 5,801 $ 5,084 $ 8,661 $ 6,991
Gains on securitizations (2) 728 27 62 61 103 101
Repurchases from securitization trusts (3) 436 881 1,485 — — —
(1)
The Corporation transfers residential mortgage loans to securitizations sponsored primarily by the GSEs or GNMA in the normal course of business and primarily receives RMBS in exchange.
Substantially all of these securities are classified as Level 2 within the fair value hierarchy and are typically sold shortly after receipt.
(2)
A majority of the first-lien residential mortgage loans securitized are initially classified as LHFS and accounted for under the fair value option. Gains recognized on these LHFS prior to
securitization, which totaled $160 million, $64 million and $71 million net of hedges, during 2020, 2019 and 2018, respectively, are not included in the table above.
(3)
The Corporation may have the option to repurchase delinquent loans out of securitization trusts, which reduces the amount of servicing advances it is required to make. The Corporation may also
repurchase loans from securitization trusts to perform modifications. Repurchased loans include FHA-insured mortgages collateralizing GNMA securities.
The Corporation recognizes consumer MSRs from the sale or During 2020, the Corporation completed the sale of $9.3
securitization of consumer real estate loans. The unpaid billion of consumer real estate loans through GNMA loan
principal balance of loans serviced for investors, including securitizations. As part of the securitizations, the Corporation
residential mortgage and home equity loans, totaled $160.4 retained $8.4 billion of MBS, which are classified as debt
billion and $192.1 billion at December 31, 2020 and 2019. securities carried at fair value on the Consolidated Balance
Servicing fee and ancillary fee income on serviced loans was Sheet. Total gains on loan sales of $704 million were recorded
$474 million, $585 million and $710 million during 2020, 2019 in other income in the Consolidated Statement of Income.
and 2018, respectively. Servicing advances on serviced loans, The following table summarizes select information related to
including loans serviced for others and loans held for first-lien mortgage securitization trusts in which the Corporation
investment, were $2.2 billion and $2.4 billion at December 31, held a variable interest at December 31, 2020 and 2019.
2020 and 2019. For more information on MSRs, see Note 20 –
Fair Value Measurements.


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First-lien Mortgage VIEs

Residential Mortgage
Non-agency
Agency Prime Subprime Alt-A Commercial Mortgage
December 31
(Dollars in millions) 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019
Unconsolidated VIEs
Maximum loss exposure (1) $ 13,477 $ 12,554 $ 250 $ 340 $ 1,031 $ 1,622 $ 46 $ 98 $ 1,169 $ 1,036
On-balance sheet assets
Senior securities:
Trading account assets $ 152 $ 627 $ 2 $ 5 $ 8 $ 54 $ 12 $ 24 $ 60 $ 65
Debt securities carried at fair
value 7,588 6,392 103 193 676 1,178 33 72 — —
Held-to-maturity securities 5,737 5,535 — — — — — — 925 809
All other assets — — 6 2 26 49 1 2 50 38
Total retained positions $ 13,477 $ 12,554 $ 111 $ 200 $ 710 $ 1,281 $ 46 $ 98 $ 1,035 $ 912
(2)
Principal balance outstanding $ 133,497 $ 160,226 $ 6,081 $ 7,268 $ 6,691 $ 8,594 $ 16,554 $ 19,878 $ 59,268 $ 60,129
Consolidated VIEs
Maximum loss exposure (1) $ 1,328 $ 10,857 $ 66 $ 5 $ 53 $ 44 $ — $ — $ — $ —
Trading account assets $ 1,328 $ 780 $ 350 $ 116 $ 260 $ 149 $ — $ — $ — $ —
Loans and leases, net — 9,917 — — — — — — — —
All other assets — 161 — — — — — — — —
Total assets $ 1,328 $ 10,858 $ 350 $ 116 $ 260 $ 149 $ — $ — $ — $ —
Total liabilities $ — $ 4 $ 284 $ 111 $ 207 $ 105 $ — $ — $ — $ —
(1)
Maximum loss exposure includes obligations under loss-sharing reinsurance and other arrangements for non-agency residential mortgage and commercial mortgage securitizations, but excludes
the reserve for representations and warranties obligations and corporate guarantees and also excludes servicing advances and other servicing rights and obligations. For more information, see
Note 12 – Commitments and Contingencies and Note 20 – Fair Value Measurements.
(2)
Principal balance outstanding includes loans where the Corporation was the transferor to securitization VIEs with which it has continuing involvement, which may include servicing the loans.
Other Asset-backed Securitizations

The following table summarizes select information related to home equity, credit card and other asset-backed VIEs in which the
Corporation held a variable interest at December 31, 2020 and 2019.
Home Equity Loan, Credit Card and Other Asset-backed VIEs

Home Equity (1) Credit Card (2) Resecuritization Trusts Municipal Bond Trusts
December 31
Unconsolidated VIEs
Maximum loss exposure $ 206 $ 412 $ — $ — $ 8,543 $ 7,526 $ 3,507 $ 3,701
Securities (3):
Trading account assets $ — $ — $ — $ — $ 948 $ 2,188 $ — $ —
Debt securities carried at fair value 2 11 — — 2,727 1,126 — —
Held-to-maturity securities — — — — 4,868 4,212 — —
Total retained positions $ 2 $ 11 $ — $ — $ 8,543 $ 7,526 $ — $ —
Total assets of VIEs $ 609 $ 1,023 $ — $ — $ 17,250 $ 21,234 $ 4,042 $ 4,395
Consolidated VIEs
Maximum loss exposure $ 58 $ 64 $ 14,606 $ 17,915 $ 217 $ 54 $ 1,030 $ 2,656
Trading account assets $ — $ — $ — $ — $ 217 $ 73 $ 990 $ 2,480
Loans and leases 218 122 21,310 26,985 — — — —
Allowance for loan and lease losses 14 (2) (1,704) (800) — — — —
All other assets 4 3 1,289 119 — — 40 176
Total assets $ 236 $ 123 $ 20,895 $ 26,304 $ 217 $ 73 $ 1,030 $ 2,656
On-balance sheet liabilities
Short-term borrowings $ — $ — $ — $ — $ — $ — $ 432 $ 2,175
Long-term debt 178 64 6,273 8,372 — 19 — —
All other liabilities — — 16 17 — — — —
Total liabilities $ 178 $ 64 $ 6,289 $ 8,389 $ — $ 19 $ 432 $ 2,175
(1)
For unconsolidated home equity loan VIEs, the maximum loss exposure includes outstanding trust certificates issued by trusts in rapid amortization, net of recorded reserves. For both
consolidated and unconsolidated home equity loan VIEs, the maximum loss exposure excludes the reserve for representations and warranties obligations and corporate guarantees. For more
information, see Note 12 – Commitments and Contingencies.
(2)
At December 31, 2020 and 2019, loans and leases in the consolidated credit card trust included $7.6 billion and $10.5 billion of seller’s interest.
(3)
The retained senior securities were valued using quoted market prices or observable market inputs (Level 2 of the fair value hierarchy).
Home Equity Loans provide subordinate funding to the trusts during a rapid
The Corporation retains interests, primarily senior securities, in amortization event. This obligation is included in the maximum
home equity securitization trusts to which it transferred home loss exposure in the table above. The charges that will
equity loans. In addition, the Corporation may be obligated to ultimately be recorded as a result of the rapid amortization

02.25.2021 22:56PM 62539
events depend on the undrawn portion of the HELOCs, in market making and similar activities prior to the
performance of the loans, the amount of subsequent draws and resecuritization and, accordingly, no gain or loss on sale was
the timing of related cash flows. recorded. Securities received from the resecuritization VIEs were
recognized at their fair value of $6.1 billion, $5.2 billion and
Credit Card Securitizations $4.1 billion during 2020, 2019 and 2018, respectively. In 2019
The Corporation securitizes originated and purchased credit card and 2018, substantially all of the securities were classified as
loans. The Corporation’s continuing involvement with the trading account assets. All of the securities received as
securitization trust includes servicing the receivables, retaining resecuritization proceeds during 2020 were classified as trading
an undivided interest (seller’s interest) in the receivables, and account assets. Of the securities received as resecuritizations
holding certain retained interests including subordinate interests proceeds during 2020, $2.4 billion, $2.1 billion and $1.7 billion
in accrued interest and fees on the securitized receivables and were classified as trading account assets, debt securities
cash reserve accounts. carried at fair value and HTM securities, respectively.
During 2020, 2019 and 2018, the Corporation issued new Substantially all of the trading account securities and debt
senior debt securities to third-party investors from the credit securities carried at fair value were categorized as Level 2
card securitization trust of $1.0 billion, $1.3 billion and $4.0 within the fair value hierarchy.
billion, respectively.
At December 31, 2020 and 2019, the Corporation held Municipal Bond Trusts
subordinate securities issued by the credit card securitization The Corporation administers municipal bond trusts that hold
trust with a notional principal amount of $6.8 billion and $7.4 highly-rated, long-term, fixed-rate municipal bonds. The trusts
billion. These securities serve as a form of credit enhancement obtain financing by issuing floating-rate trust certificates that
to the senior debt securities and have a stated interest rate of reprice on a weekly or other short-term basis to third-party
zero percent. During 2020, 2019 and 2018, the credit card investors.
securitization trust issued $161 million, $202 million and $650 The Corporation’s liquidity commitments to unconsolidated
million, respectively, of these subordinate securities. municipal bond trusts, including those for which the Corporation
was transferor, totaled $3.5 billion and $3.7 billion at
Resecuritization Trusts December 31, 2020 and 2019. The weighted-average remaining
The Corporation transfers securities, typically MBS, into life of bonds held in the trusts at December 31, 2020 was 6.8
resecuritization VIEs generally at the request of customers years. There were no significant write-downs or downgrades of
seeking securities with specific characteristics. Generally, there assets or issuers during 2020, 2019 and 2018.
are no significant ongoing activities performed in a
resecuritization trust, and no single investor has the unilateral Other Variable Interest Entities
ability to liquidate the trust. The table below summarizes select information related to other
The Corporation resecuritized $39.0 billion, $24.4 billion VIEs in which the Corporation held a variable interest at
and $22.8 billion of securities during 2020, 2019 and 2018, December 31, 2020 and 2019.
respectively. Securities transferred into resecuritization VIEs
were measured at fair value with changes in fair value recorded
Other VIEs
Consolidated Unconsolidated Total Consolidated Unconsolidated Total
(1)
Maximum loss exposure $ 4,106 $ 23,870 $ 27,976 $ 4,055 $ 21,069 $ 25,124
Trading account assets (1) $ 2,080 $ 623 $ 2,703 $ 2,213 $ 549 $ 2,762
Debt securities carried at fair value (1) — 9 9 — 10 10
Loans and leases (1) 2,108 184 2,292 1,810 533 2,343
Allowance for loan and lease losses (1) (3) (3) (6) (2) — (2)
All other assets (1) 54 22,553 22,607 81 19,354 19,435
Total (1) $ 4,239 $ 23,366 $ 27,605 $ 4,102 $ 20,446 $ 24,548
On-balance sheet liabilities
Short-term borrowings $ 22 $ — $ 22 $ — $ — $ —
Long-term debt 111 — 111 46 — 46
All other liabilities (1) — 5,658 5,658 2 4,896 4,898
Total (1) $ 133 $ 5,658 $ 5,791 $ 48 $ 4,896 $ 4,944
Total assets of VIEs (1) $ 4,239 $ 77,984 $ 82,223 $ 4,102 $ 70,120 $ 74,222
(1)
Prior-period amounts have been revised to remove certain entities that are no longer considered VIEs.
Customer VIEs Corporation’s investment, if any, in securities issued by the

Customer VIEs include credit-linked, equity-linked and VIEs.
commodity-linked note VIEs, repackaging VIEs and asset
acquisition VIEs, which are typically created on behalf of Collateralized Debt Obligation VIEs
customers who wish to obtain market or credit exposure to a The Corporation receives fees for structuring CDO VIEs, which
specific company, index, commodity or financial instrument. hold diversified pools of fixed-income securities, typically
The Corporation’s maximum loss exposure to consolidated corporate debt or ABS, which the CDO VIEs fund by issuing
and unconsolidated customer VIEs totaled $2.3 billion and $2.2 multiple tranches of debt and equity securities. CDOs are
billion at December 31, 2020 and 2019, including the notional generally managed by third-party portfolio managers. The
amount of derivatives to which the Corporation is a Corporation typically transfers assets to these CDOs, holds
counterparty, net of losses previously recorded, and the securities issued by the CDOs and may be a derivative


02.25.2021 22:56PM 62539
counterparty to the CDOs. The Corporation’s maximum loss benefits from investments in affordable housing partnerships of
exposure to consolidated and unconsolidated CDOs totaled $1.2 billion, $1.0 billion and $981 million and reported pretax
$298 million and $304 million at December 31, 2020 and losses in other income of $1.0 billion, $882 million and $798
2019. million, respectively. Tax credits are recognized as part of the
Corporation’s annual effective tax rate used to determine tax
Investment VIEs expense in a given quarter. Accordingly, the portion of a year’s
The Corporation sponsors, invests in or provides financing, expected tax benefits recognized in any given quarter may differ
which may be in connection with the sale of assets, to a variety from 25 percent. The Corporation may from time to time be
of investment VIEs that hold loans, real estate, debt securities asked to invest additional amounts to support a troubled
or other financial instruments and are designed to provide the affordable housing project. Such additional investments have
desired investment profile to investors or the Corporation. At not been and are not expected to be significant.
December 31, 2020 and 2019, the Corporation’s consolidated
investment VIEs had total assets of $494 million and $104 NOTE 7 Goodwill and Intangible Assets
million. The Corporation also held investments in
unconsolidated VIEs with total assets of $5.4 billion and $5.1 Goodwill
billion at December 31, 2020 and 2019. The Corporation’s The table below presents goodwill balances by business
maximum loss exposure associated with both consolidated and segment and All Other at December 31, 2020 and 2019. The
unconsolidated investment VIEs totaled $1.5 billion and $1.6 reporting units utilized for goodwill impairment testing are the
billion at December 31, 2020 and 2019 comprised primarily of operating segments or one level below.
on-balance sheet assets less non-recourse liabilities.
Leveraged Lease Trusts Goodwill

The Corporation’s net investment in consolidated leveraged
December 31
lease trusts totaled $1.7 billion at both December 31, 2020
and 2019. The trusts hold long-lived equipment such as rail Consumer Banking $ 30,123 $ 30,123
cars, power generation and distribution equipment, and Global Wealth & Investment Management 9,677 9,677
commercial aircraft. The Corporation structures the trusts and Global Banking 23,923 23,923
holds a significant residual interest. The net investment Global Markets 5,182 5,182
represents the Corporation’s maximum loss exposure to the All Other 46 46
trusts in the unlikely event that the leveraged lease investments Total goodwill $ 68,951 $ 68,951
become worthless. Debt issued by the leveraged lease trusts is
non-recourse to the Corporation. During 2020, the Corporation completed its annual goodwill
impairment test as of June 30, 2020 using a quantitative
Tax Credit VIEs assessment for all applicable reporting units. Based on the
The Corporation holds investments in unconsolidated limited results of the annual goodwill impairment test, the Corporation
partnerships and similar entities that construct, own and determined there was no impairment. For more information on
operate affordable housing, wind and solar projects. An the use of quantitative assessments, see Note 1 – Summary of
unrelated third party is typically the general partner or managing Significant Accounting Principles.
member and has control over the significant activities of the VIE.
The Corporation earns a return primarily through the receipt of Intangible Assets
tax credits allocated to the projects. The maximum loss At December 31, 2020 and 2019, the net carrying value of
exposure included in the Other VIEs table was $22.0 billion and intangible assets was $2.2 billion and $1.7 billion. During
$18.9 billion at December 31, 2020 and 2019. The 2020, the Corporation recognized a $585 million intangible
Corporation’s risk of loss is generally mitigated by policies asset, which is being amortized over a 10-year life, related to
requiring that the project qualify for the expected tax credits the merchant contracts that were distributed to the Corporation
prior to making its investment. from its merchant servicing joint venture. For more information,
The Corporation’s investments in affordable housing see Note 12 – Commitments and Contingencies.
partnerships, which are reported in other assets on the At both December 31, 2020 and 2019, intangible assets
Consolidated Balance Sheet, totaled $11.2 billion and $10.0 included $1.6 billion of intangible assets associated with trade
billion, including unfunded commitments to provide capital names, substantially all of which had an indefinite life and,
contributions of $5.0 billion and $4.3 billion at December 31, accordingly, are not being amortized. Amortization of intangibles
2020 and 2019. The unfunded commitments are expected to expense was $95 million, $112 million and $538 million for
be paid over the next five years. During 2020, 2019 and 2018, 2020, 2019 and 2018.
the Corporation recognized tax credits and other tax


02.25.2021 22:56PM 62539
NOTE 8 Leases
The Corporation enters into both lessor and lessee Lessee Arrangements
arrangements. For more information on lease accounting, see December 31
Note 1 – Summary of Significant Accounting Principles and on (Dollars in millions) 2020 2019
lease financing receivables, see Note 5 – Outstanding Loans and Right-of-use asset $ 10,000 $ 9,735
Leases and Allowance for Credit Losses. Lease liabilities 10,474 10,093
Weighted-average discount rate used to
Lessor Arrangements calculate present value of future minimum
lease payments 3.38 % 3.68 %
The Corporation’s lessor arrangements primarily consist of
Weighted-average lease term (in years) 8.4 8.2
operating, sales-type and direct financing leases for equipment.
Lease agreements may include options to renew and for the Lease Cost and Supplemental Information:
lessee to purchase the leased equipment at the end of the Operating lease cost $ 2,149 $ 2,085
lease term. Variable lease cost (1) 474 498
The following table presents the net investment in sales-type Total lease cost (2) $ 2,623 $ 2,583
and direct financing leases at December 31, 2020 and 2019.
Right-of-use assets obtained in exchange for
new operating lease liabilities (3) $ 851 $ 931
Operating cash flows from operating
Net Investment (1) leases (4) 2,039 2,009
(1)
Primarily consists of payments for common area maintenance and property taxes.
(2)
December 31 Amounts are recorded in occupancy and equipment expense in the Consolidated Statement
2019 of Income.
(Dollars in millions) 2020 (3)
Represents non-cash activity and, accordingly, is not reflected in the Consolidated Statement
Lease receivables $ 17,627 $ 19,312 of Cash Flows.
(4)
Unguaranteed residuals 2,303 2,550 Represents cash paid for amounts included in the measurements of lease liabilities.
Total net investment in sales-type and direct
financing leases $ 19,930 $ 21,862 Maturity Analysis
(1)
In certain cases, the Corporation obtains third-party residual value insurance to reduce its The maturities of lessor and lessee arrangements outstanding
residual asset risk. The carrying value of residual assets with third-party residual value at December 31, 2020 are presented in the table below based
insurance for at least a portion of the asset value was $6.9 billion and $5.8 billion at
December 31, 2020 and 2019. on undiscounted cash flows.
The following table presents lease income at December 31,

2020 and 2019. Maturities of Lessor and Lessee Arrangements
Lessor Lessee (1)
Lease Income Sales-type and
Operating Direct Financing Operating
December 31 Leases Leases (2) Leases
(Dollars in millions) 2020 2019 (Dollars in millions) December 31, 2020
Sales-type and direct financing leases $ 707 $ 797 2021 $ 843 $ 5,424 $ 1,927
Operating leases 931 891 2022 748 4,934 1,715
Total lease income $ 1,638 $ 1,688 2023 630 3,637 1,454
2024 479 2,089 1,308
2025 339 1,143 1,087
Lessee Arrangements Thereafter 886 1,668 4,609
The Corporation's lessee arrangements predominantly consist Total undiscounted
of operating leases for premises and equipment; the cash flows $ 3,925 18,895 12,100
Corporation's financing leases are not significant. Less: Net present
value adjustment 1,268 1,626
Lease terms may contain renewal and extension options and
Total (3) $ 17,627 $ 10,474
early termination features. Generally, these options do not (1)
Excludes $885 million in commitments under lessee arrangements that have not yet
impact the lease term because the Corporation is not commenced with lease terms that will begin in 2021.
reasonably certain that it will exercise the options. (2)
Includes $12.7 billion in commercial lease financing receivables and $4.9 billion in direct/
indirect consumer lease financing receivables.
The following table provides information on the right-of-use (3)
Represents lease receivables for lessor arrangements and lease liabilities for lessee
assets, lease liabilities and weighted-average discount rates arrangements.
and lease terms at December 31, 2020 and 2019.
NOTE 9 Deposits
The table below presents information about the Corporation’s time deposits of $100,000 or more at December 31, 2020 and
2019. The Corporation also had aggregate time deposits of $10.7 billion and $15.8 billion in denominations that met or exceeded
the Federal Deposit Insurance Corporation (FDIC) insurance limit at December 31, 2020 and 2019.
Time Deposits of $100,000 or More

December 31
December 31, 2020 2019
Over Three
Three Months Months to
(Dollars in millions) or Less Twelve Months Thereafter Total Total
U.S. certificates of deposit and other time deposits $ 12,485 $ 10,668 $ 1,445 $ 24,598 $ 39,739
Non-U.S. certificates of deposit and other time deposits 8,568 1,925 1,432 11,925 13,034


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The scheduled contractual maturities for total time deposits at December 31, 2020 are presented in the table below.
Contractual Maturities of Total Time Deposits

(Dollars in millions) U.S. Non-U.S. Total
Due in 2021 $ 40,052 $ 10,609 $ 50,661
Due in 2022 2,604 167 2,771
Due in 2023 431 4 435
Due in 2024 222 5 227
Due in 2025 186 13 199
Thereafter 276 1,287 1,563
Total time deposits $ 43,771 $ 12,085 $ 55,856
NOTE 10 Federal Funds Sold or Purchased, Securities Financing Agreements, Short-term Borrowings
and Restricted Cash
The table below presents federal funds sold or purchased, securities financing agreements (which include securities borrowed or
purchased under agreements to resell and securities loaned or sold under agreements to repurchase) and short-term borrowings.
The Corporation elects to account for certain securities financing agreements and short-term borrowings under the fair value option.
For more information on the fair value option, see Note 21 – Fair Value Option.
Amount Rate Amount Rate

Federal funds sold and securities borrowed or purchased under agreements to resell
Average during year $ 309,945 0.29 % $ 279,610 1.73 %
Maximum month-end balance during year 451,179 n/a 281,684 n/a
Federal funds purchased and securities loaned or sold under agreements to repurchase
Average during year $ 192,479 0.69 % $ 201,797 2.31 %
Short-term borrowings
Average during year 22,486 0.54 24,301 2.42
Bank of America, N.A. maintains a global program to offer up to liquidate securities held and to offset receivables and
to a maximum of $75.0 billion outstanding at any one time, of payables with the same counterparty. The Corporation offsets
bank notes with fixed or floating rates and maturities of at least securities financing transactions with the same counterparty on
seven days from the date of issue. Short-term bank notes the Consolidated Balance Sheet where it has such a legally
outstanding under this program totaled $3.9 billion and $11.7 enforceable master netting agreement and the transactions
billion at December 31, 2020 and 2019. These short-term bank have the same maturity date.
notes, along with Federal Home Loan Bank advances, U.S. The Securities Financing Agreements table presents
Treasury tax and loan notes, and term federal funds purchased, securities financing agreements included on the Consolidated
are included in short-term borrowings on the Consolidated Balance Sheet in federal funds sold and securities borrowed or
Balance Sheet. purchased under agreements to resell, and in federal funds
purchased and securities loaned or sold under agreements to
Offsetting of Securities Financing Agreements repurchase at December 31, 2020 and 2019. Balances are
The Corporation enters into securities financing agreements to presented on a gross basis, prior to the application of
accommodate customers (also referred to as “matched-book counterparty netting. Gross assets and liabilities are adjusted
transactions”), obtain securities to cover short positions and on an aggregate basis to take into consideration the effects of
finance inventory positions. Substantially all of the Corporation’s legally enforceable master netting agreements. For more
securities financing activities are transacted under legally information on the offsetting of derivatives, see Note 3 –
enforceable master repurchase agreements or legally Derivatives.
enforceable master securities lending agreements that give the
Corporation, in the event of default by the counterparty, the right


02.25.2021 22:56PM 62539
Securities Financing Agreements

Gross Assets/ Net Balance Financial Net Assets/
Liabilities (1) Amounts Offset Sheet Amount Instruments (2) Liabilities
Securities borrowed or purchased under agreements to resell (3) $ 492,387 $ (188,329) $ 304,058 $ (272,351) $ 31,707
Securities loaned or sold under agreements to repurchase $ 358,652 $ (188,329) $ 170,323 $ (158,867) $ 11,456
Other (4) 16,210 — 16,210 (16,210) —
Total $ 374,862 $ (188,329) $ 186,533 $ (175,077) $ 11,456
December 31, 2019

Securities borrowed or purchased under agreements to resell (3) $ 434,257 $ (159,660) $ 274,597 $ (244,486) $ 30,111
Securities loaned or sold under agreements to repurchase $ 324,769 $ (159,660) $ 165,109 $ (141,482) $ 23,627
Other (4) 15,346 — 15,346 (15,346) —
Total $ 340,115 $ (159,660) $ 180,455 $ (156,828) $ 23,627
(1)
Includes activity where uncertainty exists as to the enforceability of certain master netting agreements under bankruptcy laws in some countries or industries.
(2)
Includes securities collateral received or pledged under repurchase or securities lending agreements where there is a legally enforceable master netting agreement. These amounts are not offset
on the Consolidated Balance Sheet, but are shown as a reduction to derive a net asset or liability. Securities collateral received or pledged where the legal enforceability of the master netting
agreements is uncertain is excluded from the table.
(3)
Excludes repurchase activity of $14.7 billion and $12.9 billion reported in loans and leases on the Consolidated Balance Sheet at December 31, 2020 and 2019.
(4)
Balance is reported in accrued expenses and other liabilities on the Consolidated Balance Sheet and relates to transactions where the Corporation acts as the lender in a securities lending
agreement and receives securities that can be pledged as collateral or sold. In these transactions, the Corporation recognizes an asset at fair value, representing the securities received, and a
liability, representing the obligation to return those securities.
Repurchase Agreements and Securities Loaned Transactions Accounted for as Secured Borrowings
The following tables present securities sold under agreements to repurchase and securities loaned by remaining contractual term to
maturity and class of collateral pledged. Included in “Other” are transactions where the Corporation acts as the lender in a
securities lending agreement and receives securities that can be pledged as collateral or sold. Certain agreements contain a right to
substitute collateral and/or terminate the agreement prior to maturity at the option of the Corporation or the counterparty. Such
agreements are included in the table below based on the remaining contractual term to maturity.
Remaining Contractual Maturity

Overnight and After 30 Days Greater than
Continuous 30 Days or Less Through 90 Days 90 Days (1) Total
Securities sold under agreements to repurchase $ 158,400 $ 122,448 $ 32,149 $ 22,684 $ 335,681
Securities loaned 19,140 271 1,029 2,531 22,971
Other 16,210 — — — 16,210
Total $ 193,750 $ 122,719 $ 33,178 $ 25,215 $ 374,862
December 31, 2019

Securities sold under agreements to repurchase $ 129,455 $ 122,685 $ 25,322 $ 21,922 $ 299,384
Securities loaned 18,766 3,329 1,241 2,049 25,385
Other 15,346 — — — 15,346
Total $ 163,567 $ 126,014 $ 26,563 $ 23,971 $ 340,115
(1)
No agreements have maturities greater than three years.
Class of Collateral Pledged

Securities Sold
Under Agreements Securities
to Repurchase Loaned Other Total
U.S. government and agency securities $ 195,167 $ 5 $ — $ 195,172
Corporate securities, trading loans and other 8,633 1,628 1,217 11,478
Equity securities 14,752 21,125 14,931 50,808
Non-U.S. sovereign debt 113,142 213 62 113,417
Mortgage trading loans and ABS 3,987 — — 3,987
Total $ 335,681 $ 22,971 $ 16,210 $ 374,862
December 31, 2019

U.S. government and agency securities $ 173,533 $ 1 $ — $ 173,534
Corporate securities, trading loans and other 10,467 2,014 258 12,739
Equity securities 14,933 20,026 15,024 49,983
Non-U.S. sovereign debt 96,576 3,344 64 99,984

Mortgage trading loans and ABS 3,875 — — 3,875
Total $ 299,384 $ 25,385 $ 15,346 $ 340,115


02.25.2021 22:56PM 62539
Under repurchase agreements, the Corporation is required to funding from a diverse group of counterparties, providing a
post collateral with a market value equal to or in excess of the range of securities collateral and pursuing longer durations,
principal amount borrowed. For securities loaned transactions, when appropriate.
the Corporation receives collateral in the form of cash, letters of
credit or other securities. To determine whether the market Restricted Cash
value of the underlying collateral remains sufficient, collateral is At December 31, 2020 and 2019, the Corporation held
generally valued daily, and the Corporation may be required to restricted cash included within cash and cash equivalents on
deposit additional collateral or may receive or return collateral the Consolidated Balance Sheet of $7.0 billion and $24.4
pledged when appropriate. Repurchase agreements and billion, predominantly related to cash held on deposit with the
securities loaned transactions are generally either overnight, Federal Reserve Bank and non-U.S. central banks to meet
continuous (i.e., no stated term) or short-term. The Corporation reserve requirements and cash segregated in compliance with
manages liquidity risks related to these agreements by sourcing securities regulations.
NOTE 11 Long-term Debt

Long-term debt consists of borrowings having an original maturity of one year or more. The table below presents the balance of long-
term debt at December 31, 2020 and 2019, and the related contractual rates and maturity dates as of December 31, 2020.
Weighted- December 31
(Dollars in millions) average Rate Interest Rates Maturity Dates 2020 2019
Notes issued by Bank of America Corporation (1)
Senior notes:
Fixed 3.05 % 0.25 - 8.05 % 2021 - 2051 $ 174,385 $ 140,265
Floating 0.74 0.09 - 4.96 2021 - 2044 16,788 19,552
Senior structured notes 17,033 16,941
Subordinated notes:
Fixed 4.89 2.94 - 8.57 2021 - 2045 23,337 21,632
Floating 1.15 0.88 - 1.41 2022 - 2026 799 782
Junior subordinated notes:
Fixed 6.71 6.45 - 8.05 2027 - 2066 738 736
Floating 1.03 1.03 2056 1 1
Total notes issued by Bank of America Corporation 233,081 199,909
Notes issued by Bank of America, N.A.
Senior notes:
Fixed 3.34 3.34 2023 511 508
Floating 0.33 0.28 - 0.49 2021 - 2041 2,323 6,519
Subordinated notes 6.00 6.00 2036 1,883 1,744
Advances from Federal Home Loan Banks:
Fixed 0.99 0.01 - 7.72 2021 - 2034 599 112
Floating — 2,500
Securitizations and other BANA VIEs (2) 6,296 8,373
Other 683 402
Total notes issued by Bank of America, N.A. 12,295 20,158
Other debt
Structured liabilities 16,792 20,442
Nonbank VIEs (2) 757 347
Other 9 —
Total notes issued by nonbank and other entities 17,558 20,789
Total long-term debt $ 262,934 $ 240,856
(1)
Includes total loss-absorbing capacity compliant debt.
(2)
Represents liabilities of consolidated VIEs included in total long-term debt on the Consolidated Balance Sheet.
During 2020, the Corporation issued $56.9 billion of long- Bank of America Corporation and Bank of America, N.A.
term debt consisting of $43.8 billion of notes issued by Bank of maintain various U.S. and non-U.S. debt programs to offer both
America Corporation, $4.8 billion of notes issued by Bank of senior and subordinated notes. The notes may be denominated
America, N.A. and $8.3 billion of other debt. During 2019, the in U.S. dollars or foreign currencies. At December 31, 2020 and
Corporation issued $52.5 billion of long-term debt consisting of 2019, the amount of foreign currency-denominated debt
$29.3 billion of notes issued by Bank of America Corporation, translated into U.S. dollars included in total long-term debt was
$10.9 billion of notes issued by Bank of America, N.A. and $54.6 billion and $49.6 billion. Foreign currency contracts may
$12.3 billion of other debt. be used to convert certain foreign currency-denominated debt
During 2020, the Corporation had total long-term debt into U.S. dollars.
maturities and redemptions in the aggregate of $47.1 billion At December 31, 2020, long-term debt of consolidated VIEs
consisting of $22.6 billion for Bank of America Corporation, in the table above included debt from credit card, residential
$11.5 billion for Bank of America, N.A. and $13.0 billion of mortgage, home equity and other VIEs of $6.3 billion, $491
other debt. During 2019, the Corporation had total long-term million, $178 million and $111 million, respectively. Long-term
debt maturities and redemptions in the aggregate of $50.6 debt of VIEs is collateralized by the assets of the VIEs. For more
billion consisting of $21.1 billion for Bank of America information, see Note 6 – Securitizations and Other Variable
Corporation, $19.9 billion for Bank of America, N.A. and $9.6 Interest Entities.
billion of other debt.


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The weighted-average effective interest rates for total long- of Bank of America Corporation, the parent company, and is fully
term debt (excluding senior structured notes), total fixed-rate and unconditionally guaranteed by the parent company.
debt and total floating-rate debt were 3.02 percent, 3.29 The table below shows the carrying value for aggregate
percent and 0.71 percent, respectively, at December 31, 2020, annual contractual maturities of long-term debt as of
and 3.26 percent, 3.55 percent and 1.92 percent, respectively, December 31, 2020. Included in the table are certain structured
at December 31, 2019. The Corporation’s ALM activities notes issued by the Corporation that contain provisions whereby
maintain an overall interest rate risk management strategy that the borrowings are redeemable at the option of the holder (put
incorporates the use of interest rate contracts to manage options) at specified dates prior to maturity. Other structured
fluctuations in earnings caused by interest rate volatility. The notes have coupon or repayment terms linked to the
Corporation’s goal is to manage interest rate sensitivity so that performance of debt or equity securities, indices, currencies or
movements in interest rates do not have a significantly adverse commodities, and the maturity may be accelerated based on the
effect on earnings and capital. The weighted-average rates are value of a referenced index or security. In both cases, the
the contractual interest rates on the debt and do not reflect the Corporation or a subsidiary may be required to settle the
impacts of derivative transactions. obligation for cash or other securities prior to the contractual
Debt outstanding of $4.8 billion at December 31, 2020 was maturity date. These borrowings are reflected in the table as
issued by BofA Finance LLC, a consolidated finance subsidiary maturing at their contractual maturity date.
Long-term Debt by Maturity

(Dollars in millions) 2021 2022 2023 2024 2025 Thereafter Total
Bank of America Corporation
Senior notes $ 8,888 $ 15,380 $ 23,872 $ 21,407 $ 15,723 $ 105,903 $ 191,173
Senior structured notes 469 2,034 597 190 549 13,194 17,033
Subordinated notes 371 393 — 3,351 5,537 14,484 24,136
Junior subordinated notes — — — — — 739 739
Total Bank of America Corporation 9,728 17,807 24,469 24,948 21,809 134,320 233,081
Bank of America, N.A.
Senior notes 1,340 975 511 — — 8 2,834
Subordinated notes — — — — — 1,883 1,883
Advances from Federal Home Loan Banks 502 3 1 — 18 75 599
Securitizations and other Bank VIEs (1) 4,056 1,241 977 — — 22 6,296
Other 112 16 189 — 279 87 683
Total Bank of America, N.A. 6,010 2,235 1,678 — 297 2,075 12,295
Other debt
Structured Liabilities 4,613 2,414 2,221 655 859 6,030 16,792
Nonbank VIEs (1) 1 — — — — 756 757
Other — — — — — 9 9
Total other debt 4,614 2,414 2,221 655 859 6,795 17,558
Total long-term debt $ 20,352 $ 22,456 $ 28,368 $ 25,603 $ 22,965 $ 143,190 $ 262,934
(1)
Represents liabilities of consolidated VIEs included in total long-term debt on the Consolidated Balance Sheet.
NOTE 12 Commitments and Contingencies $1.9 billion and $829 million, which primarily related to the
In the normal course of business, the Corporation enters into a reserve for unfunded lending commitments. The carrying value
number of off-balance sheet commitments. These commitments of these commitments is classified in accrued expenses and
expose the Corporation to varying degrees of credit and market other liabilities on the Consolidated Balance Sheet.
risk and are subject to the same credit and market risk Legally binding commitments to extend credit generally have
limitation reviews as those instruments recorded on the specified rates and maturities. Certain of these commitments
Consolidated Balance Sheet. have adverse change clauses that help to protect the
Corporation against deterioration in the borrower’s ability to pay.
Credit Extension Commitments The table below includes the notional amount of
The Corporation enters into commitments to extend credit such commitments of $4.0 billion and $4.4 billion at December 31,
as loan commitments, SBLCs and commercial letters of credit 2020 and 2019 that are accounted for under the fair value
to meet the financing needs of its customers. The following option. However, the table excludes cumulative net fair value of
table includes the notional amount of unfunded legally binding $99 million and $90 million at December 31, 2020 and 2019
lending commitments net of amounts distributed (i.e., on these commitments, which is classified in accrued expenses
syndicated or participated) to other financial institutions. The and other liabilities. For more information regarding the
distributed amounts were $10.5 billion and $10.6 billion at Corporation’s loan commitments accounted for under the fair
December 31, 2020 and 2019. The carrying value of these value option, see Note 21 – Fair Value Option.
commitments at December 31, 2020 and 2019, excluding
commitments accounted for under the fair value option, was


02.25.2021 22:56PM 62539
Credit Extension Commitments

Expire After One Expire After Three
Expire in One Year Through Years Through Expire After
Year or Less Three Years Five Years Five Years Total
Notional amount of credit extension commitments
Loan commitments (1) $ 109,406 $ 171,887 $ 139,508 $ 16,091 $ 436,892
Home equity lines of credit 710 2,992 8,738 29,892 42,332
Standby letters of credit and financial guarantees (2) 19,962 12,038 2,397 1,257 35,654
Letters of credit (3) 886 197 25 27 1,135
Legally binding commitments 130,964 187,114 150,668 47,267 516,013
Credit card lines (4) 384,955 — — — 384,955
Total credit extension commitments $ 515,919 $ 187,114 $ 150,668 $ 47,267 $ 900,968
December 31, 2019

Notional amount of credit extension commitments
Loan commitments (1) $ 97,454 $ 148,000 $ 173,699 $ 24,487 $ 443,640
Home equity lines of credit 1,137 1,948 6,351 34,134 43,570
Standby letters of credit and financial guarantees (2) 21,311 11,512 3,712 408 36,943
Letters of credit (3) 1,156 254 65 25 1,500
Legally binding commitments 121,058 161,714 183,827 59,054 525,653
Credit card lines (4) 376,067 — — — 376,067
Total credit extension commitments $ 497,125 $ 161,714 $ 183,827 $ 59,054 $ 901,720
(1)
At December 31, 2020 and 2019, $4.8 billion and $5.1 billion of these loan commitments were held in the form of a security.
(2)
The notional amounts of SBLCs and financial guarantees classified as investment grade and non-investment grade based on the credit quality of the underlying reference name within the
instrument were $25.0 billion and $10.2 billion at December 31, 2020, and $27.9 billion and $8.6 billion at December 31, 2019. Amounts in the table include consumer SBLCs of $500 million
and $413 million at December 31, 2020 and 2019.
(3)
At December 31, 2020 and 2019, included are letters of credit of $1.8 billion and $1.4 billion related to certain liquidity commitments of VIEs. For more information, see Note 6 – Securitizations
and Other Variable Interest Entities.
(4)
Includes business card unused lines of credit.
Other Commitments Indemnifications

At December 31, 2020 and 2019, the Corporation had In the ordinary course of business, the Corporation enters into
commitments to purchase loans (e.g., residential mortgage and various agreements that contain indemnifications, such as tax
commercial real estate) of $93 million and $86 million, which indemnifications, whereupon payment may become due if
upon settlement will be included in trading account assets, certain external events occur, such as a change in tax law. The
loans or LHFS, and commitments to purchase commercial loans indemnification clauses are often standard contractual terms
of $645 million and $1.1 billion, which upon settlement will be and were entered into in the normal course of business based
included in trading account assets. on an assessment that the risk of loss would be remote. These
At December 31, 2020 and 2019, the Corporation had agreements typically contain an early termination clause that
commitments to purchase commodities, primarily liquefied permits the Corporation to exit the agreement upon these
natural gas, of $582 million and $830 million, which upon events. The maximum potential future payment under
settlement will be included in trading account assets. indemnification agreements is difficult to assess for several
At December 31, 2020 and 2019, the Corporation had reasons, including the occurrence of an external event, the
commitments to enter into resale and forward-dated resale and inability to predict future changes in tax and other laws, the
securities borrowing agreements of $66.5 billion and $97.2 difficulty in determining how such laws would apply to parties in
billion, and commitments to enter into forward-dated repurchase contracts, the absence of exposure limits contained in standard
and securities lending agreements of $32.1 billion and $24.9 contract language and the timing of any early termination
billion. These commitments generally expire within the next 12 clauses. Historically, any payments made under these
months. guarantees have been de minimis. The Corporation has
At December 31, 2020 and 2019, the Corporation had a assessed the probability of making such payments in the future
commitment to originate or purchase up to $3.9 billion and as remote.
$3.3 billion on a rolling 12-month basis, of auto loans and
leases from a strategic partner. This commitment extends Merchant Services
through November 2022 and can be terminated with 12 months Prior to July 1, 2020, a significant portion of the Corporation's
prior notice. merchant processing activity was performed by a joint venture in
which the Corporation held a 49 percent ownership interest. On
Other Guarantees July 29, 2019, the Corporation gave notice to the joint venture
partner of the termination of the joint venture upon the
Bank-owned Life Insurance Book Value Protection conclusion of its current term on June 30, 2020. Effective July
The Corporation sells products that offer book value protection 1, 2020, the Corporation received its share of the joint
to insurance carriers who offer group life insurance policies to venture's merchant contracts and began performing merchant
corporations, primarily banks. At December 31, 2020 and processing services for these merchants. While merchants bear
2019, the notional amount of these guarantees totaled $7.1 responsibility for any credit or debit card charges properly
billion and $7.3 billion. At both December 31, 2020 and 2019, reversed by the cardholder, the Corporation, in its role as
the Corporation’s maximum exposure related to these merchant acquirer, may be held liable for any reversed charges
guarantees totaled $1.1 billion, with estimated maturity dates that cannot be collected from the merchants due to, among
between 2033 and 2039. other things, merchant fraud or insolvency.

02.25.2021 22:56PM 62539
The Corporation, as a card network member bank, also secured by a security interest in cash or high-quality securities
sponsors other merchant acquirers, principally its former joint collateral placed by clients with the clearinghouse and therefore,
venture partner with respect to merchant contracts distributed the potential for the Corporation to incur significant losses
to that partner upon the termination of the joint venture. If under this arrangement is remote. The Corporation’s maximum
charges are properly reversed after a purchase and cannot be potential exposure, without taking into consideration the related
collected from either the merchants or merchant acquirers, the collateral, was $22.5 billion and $9.3 billion at December 31,
Corporation may be held liable for these reversed charges. The 2020 and 2019.
ability to reverse a charge is primarily governed by the
applicable regulatory and card network rules, which include, but Other Guarantees
are not limited to, the type of charge, type of payment used and The Corporation has entered into additional guarantee
time limits. For the six-months ended December 31, 2020, the agreements and commitments, including sold risk participation
Corporation processed an aggregate purchase volume of swaps, liquidity facilities, lease-end obligation agreements,
$339.2 billion. The Corporation’s risk in this area primarily partial credit guarantees on certain leases, real estate joint
relates to circumstances where a cardholder has purchased venture guarantees, divested business commitments and sold
goods or services for future delivery. The Corporation mitigates put options that require gross settlement. The maximum
this risk by requiring cash deposits, guarantees, letters of credit potential future payments under these agreements are
or other types of collateral from certain merchants. The approximately $8.8 billion and $8.7 billion at December 31,
Corporation’s reserves for contingent losses and the losses 2020 and 2019. The estimated maturity dates of these
incurred related to the merchant processing activity were not obligations extend up to 2049. The Corporation has made no
significant. The Corporation continues to monitor its exposure in material payments under these guarantees. For more
this area due to the potential economic impacts of COVID-19. information on maximum potential future payments under VIE-
related liquidity commitments, see Note 6 – Securitizations and
Exchange and Clearing House Member Guarantees Other Variable Interest Entities.
The Corporation is a member of various securities and derivative In the normal course of business, the Corporation periodically
exchanges and clearinghouses, both in the U.S. and other guarantees the obligations of its affiliates in a variety of
countries. As a member, the Corporation may be required to pay transactions including ISDA-related transactions and non-ISDA
a pro-rata share of the losses incurred by some of these related transactions such as commodities trading, repurchase
organizations as a result of another member default and under agreements, prime brokerage agreements and other
other loss scenarios. The Corporation’s potential obligations transactions.
may be limited to its membership interests in such exchanges
and clearinghouses, to the amount (or multiple) of the Guarantees of Certain Long-term Debt
Corporation’s contribution to the guarantee fund or, in limited The Corporation, as the parent company, fully and
instances, to the full pro-rata share of the residual losses after unconditionally guarantees the securities issued by BofA
applying the guarantee fund. The Corporation’s maximum Finance LLC, a consolidated finance subsidiary of the
potential exposure under these membership agreements is Corporation, and effectively provides for the full and
difficult to estimate; however, the Corporation has assessed the unconditional guarantee of trust securities issued by certain
probability of making any such payments as remote. statutory trust companies that are 100 percent owned finance
subsidiaries of the Corporation.
Prime Brokerage and Securities Clearing Services
In connection with its prime brokerage and clearing businesses, Representations and Warranties Obligations and
the Corporation performs securities clearance and settlement Corporate Guarantees
services with other brokerage firms and clearinghouses on The Corporation securitizes first-lien residential mortgage loans
behalf of its clients. Under these arrangements, the Corporation generally in the form of RMBS guaranteed by the GSEs or by
stands ready to meet the obligations of its clients with respect GNMA in the case of FHA-insured, VA-guaranteed and Rural
to securities transactions. The Corporation’s obligations in this Housing Service-guaranteed mortgage loans, and sells pools of
respect are secured by the assets in the clients’ accounts and first-lien residential mortgage loans in the form of whole loans.
the accounts of their customers as well as by any proceeds In addition, in prior years, legacy companies and certain
received from the transactions cleared and settled by the subsidiaries sold pools of first-lien residential mortgage loans
Corporation on behalf of clients or their customers. The and home equity loans as private-label securitizations or in the
Corporation’s maximum potential exposure under these form of whole loans. In connection with these transactions, the
arrangements is difficult to estimate; however, the potential for Corporation or certain of its subsidiaries or legacy companies
the Corporation to incur material losses pursuant to these make and have made various representations and warranties.
arrangements is remote. Breaches of these representations and warranties have resulted
in and may continue to result in the requirement to repurchase
Fixed Income Clearing Corporation Sponsored Member mortgage loans or to otherwise make whole or provide
Repo Program indemnification or other remedies to sponsors, investors,
The Corporation acts as a sponsoring member in a repo securitization trusts, guarantors, insurers or other parties
program whereby the Corporation clears certain eligible resale (collectively, repurchases).
and repurchase agreements through the Government Securities
Division of the Fixed Income Clearing Corporation on behalf of Unresolved Repurchase Claims
clients that are sponsored members in accordance with the Unresolved representations and warranties repurchase claims
Fixed Income Clearing Corporation’s rules. As part of this represent the notional amount of repurchase claims made by
program, the Corporation guarantees the payment and counterparties, typically the outstanding principal balance or the
performance of its sponsored members to the Fixed Income unpaid principal balance at the time of default. In the case of
Clearing Corporation. The Corporation’s guarantee obligation is first-lien mortgages, the claim amount is often significantly


02.25.2021 22:56PM 62539
greater than the expected loss amount due to the benefit of billion in excess of the accrued liability, if any, as of December
collateral and, in some cases, mortgage insurance or mortgage 31, 2020.
guarantee payments. The accrued liability and estimated range of possible loss
The notional amount of unresolved repurchase claims at are based upon currently available information and subject to
December 31, 2020 and 2019 was $8.5 billion and $10.7 significant judgment, a variety of assumptions and known and
billion. These balances included $2.9 billion and $3.7 billion at unknown uncertainties. The matters underlying the accrued
December 31, 2020 and 2019 of claims related to loans in liability and estimated range of possible loss are unpredictable
specific private-label securitization groups or tranches where the and may change from time to time, and actual losses may vary
Corporation owns substantially all of the outstanding securities significantly from the current estimate and accrual. The
or will otherwise realize the benefit of any repurchase claims estimated range of possible loss does not represent the
paid. Corporation’s maximum loss exposure.
During 2020, the Corporation received $89 million in new Information is provided below regarding the nature of the
repurchase claims that were not time-barred. During 2020, litigation and associated claimed damages. Based on current
$2.4 billion in claims were resolved, including $168 million of knowledge, and taking into account accrued liabilities,
claims that were deemed time-barred. management does not believe that loss contingencies arising
from pending matters, including the matters described herein,
Reserve and Related Provision will have a material adverse effect on the consolidated financial
The reserve for representations and warranties obligations and condition or liquidity of the Corporation. However, in light of the
corporate guarantees was $1.3 billion and $1.8 billion at significant judgment, variety of assumptions and uncertainties
December 31, 2020 and 2019 and is included in accrued involved in these matters, some of which are beyond the
expenses and other liabilities on the Consolidated Balance Corporation’s control, and the very large or indeterminate
Sheet and the related provision is included in other income in damages sought in some of these matters, an adverse outcome
the Consolidated Statement of Income. The representations and in one or more of these matters could be material to the
warranties reserve represents the Corporation’s best estimate Corporation’s business or results of operations for any
of probable incurred losses, is based on its experience in particular reporting period, or cause significant reputational
previous negotiations, and is subject to judgment, a variety of harm.
assumptions, and known or unknown uncertainties. Future
representations and warranties losses may occur in excess of Ambac Bond Insurance Litigation
the amounts recorded for these exposures; however, the Ambac Assurance Corporation and the Segregated Account of
Corporation does not expect such amounts to be material to the Ambac Assurance Corporation (together, Ambac) have filed four
Corporation's financial condition and liquidity. See Litigation and separate lawsuits against the Corporation and its subsidiaries
Regulatory Matters below for the Corporation's combined range relating to bond insurance policies Ambac provided on certain
of possible loss in excess of the reserve for representations securitized pools of HELOCs, first-lien subprime home equity
and warranties and the accrued liability for litigation. loans, fixed-rate second-lien mortgage loans and negative
amortization pay option adjustable-rate mortgage loans. Ambac
Litigation and Regulatory Matters alleges that they have paid or will pay claims as a result of
In the ordinary course of business, the Corporation and its defaults in the underlying loans and asserts that the defendants
subsidiaries are routinely defendants in or parties to many misrepresented the characteristics of the underlying loans and/
pending and threatened legal, regulatory and governmental or breached certain contractual representations and warranties
actions and proceedings. In view of the inherent difficulty of regarding the underwriting and servicing of the loans. In those
predicting the outcome of such matters, particularly where the actions where the Corporation is named as a defendant, Ambac
claimants seek very large or indeterminate damages or where contends the Corporation is liable on various successor and
the matters present novel legal theories or involve a large vicarious liability theories. These actions are at various
number of parties, the Corporation generally cannot predict the procedural stages with material developments provided below.
eventual outcome of the pending matters, timing of the ultimate
resolution of these matters, or eventual loss, fines or penalties Ambac v. Countrywide I
related to each pending matter. The Corporation, and several Countrywide entities are named as
As a matter develops, the Corporation, in conjunction with defendants in an action filed on September 28, 2010 in New
any outside counsel handling the matter, evaluates whether York Supreme Court. Ambac asserts claims for fraudulent
such matter presents a loss contingency that is probable and inducement as well as breach of contract and seeks damages in
estimable, and, for the matters disclosed in this Note, whether excess of $2.2 billion, plus punitive damages.
a loss in excess of any accrued liability is reasonably possible in On May 16, 2017, the First Department issued its decisions
future periods. Once the loss contingency is deemed to be both on the parties' cross-appeals of the trial court's October 22,
probable and estimable, the Corporation will establish an 2015 summary judgment rulings. Ambac appealed the First
accrued liability and record a corresponding amount of litigation- Department's rulings requiring Ambac to prove all of the
related expense. The Corporation continues to monitor the elements of its fraudulent inducement claim, including
matter for further developments that could affect the amount of justifiable reliance and loss causation; restricting Ambac's sole
the accrued liability that has been previously established. remedy for its breach of contract claims to the repurchase
Excluding expenses of internal and external legal service protocol of cure, repurchase or substitution of any materially
providers, litigation-related expense of $823 million and $681 defective loan; and dismissing Ambac's claim for
million was recognized in 2020 and 2019. reimbursements of attorneys' fees. On June 27, 2018, the New
For the matters disclosed in this Note for which a loss in York Court of Appeals affirmed the First Department rulings that
future periods is reasonably possible and estimable (whether in Ambac appealed.
excess of an accrued liability or where there is no accrued
liability) and for representations and warranties exposures, the
Corporation’s estimated range of possible loss is $0 to $1.3


02.25.2021 22:56PM 62539
On December 4, 2020, the New York Supreme Court and its subsidiaries regarding FX and other reference rates as
dismissed Ambac’s fraudulent inducement claim. Ambac well as government, sovereign, supranational and agency bonds
appealed the dismissal. in connection with conduct and systems and controls. The
Corporation is cooperating with these inquiries and
Ambac v. Countrywide II investigations, and responding to the proceedings.
On December 30, 2014, Ambac filed a complaint in New York
Supreme Court against the same defendants, claiming LIBOR
fraudulent inducement against Countrywide, and successor and The Corporation, BANA and certain Merrill Lynch entities have
vicarious liability against the Corporation. Ambac seeks been named as defendants along with most of the other LIBOR
damages in excess of $600 million, plus punitive damages. panel banks in a number of individual and putative class actions
by persons alleging they sustained losses on U.S. dollar LIBOR-
Ambac v. Countrywide IV based financial instruments as a result of collusion or
On July 21, 2015, Ambac filed an action in New York Supreme manipulation by defendants regarding the setting of U.S. dollar
Court against Countrywide asserting the same claims for LIBOR. Plaintiffs assert a variety of claims, including antitrust,
fraudulent inducement that Ambac asserted in the now- Commodity Exchange Act, Racketeer Influenced and Corrupt
dismissed Ambac v. Countrywide III. The complaint seeks Organizations (RICO), Securities Exchange Act of 1934, common
damages in excess of $350 million, plus punitive damages. On law fraud and breach of contract claims, and seek
December 8, 2020, the New York Supreme Court dismissed compensatory, treble and punitive damages, and injunctive
Ambac’s complaint. Ambac appealed the dismissal. relief. All but one of the cases naming the Corporation and its
Ambac v. First Franklin affiliates relating to U.S. dollar LIBOR are pending in the U.S.
On April 16, 2012, Ambac filed an action against BANA, First District Court for the Southern District of New York.
Franklin and various Merrill Lynch entities, including Merrill The District Court has dismissed all RICO claims, and
Lynch, Pierce, Fenner & Smith Incorporated, in New York dismissed all manipulation claims against Bank of America
Supreme Court relating to guaranty insurance Ambac provided entities based on alleged trader conduct. The District Court has
on a First Franklin securitization sponsored by Merrill Lynch. The also substantially limited the scope of antitrust, Commodity
complaint alleges fraudulent inducement and breach of contract, Exchange Act and various other claims, including by dismissing
including breach of contract claims against BANA based upon its in their entirety certain individual and putative class plaintiffs’
servicing of the loans in the securitization. Ambac seeks as antitrust claims for lack of standing and/or personal jurisdiction.
damages hundreds of millions of dollars that Ambac alleges it Plaintiffs whose antitrust claims were dismissed by the District
has paid or will pay in claims. Court are pursuing appeals in the Second Circuit. Certain
individual and putative class actions remain pending against the
Deposit Insurance Assessment Corporation, BANA and certain Merrill Lynch entities.
On January 9, 2017, the FDIC filed suit against BANA in the U.S. On February 28, 2018, the District Court granted certification
District Court for the District of Columbia alleging failure to pay a of a class of persons that purchased OTC swaps and notes that
December 15, 2016 invoice for additional deposit insurance referenced U.S. dollar LIBOR from one of the U.S. dollar LIBOR
assessments and interest in the amount of $542 million for the panel banks, limited to claims under Section 1 of the Sherman
quarters ending June 30, 2013 through December 31, 2014. Act. The U.S. Court of Appeals for the Second Circuit
On April 7, 2017, the FDIC amended its complaint to add a subsequently denied a petition filed by the defendants for
claim for additional deposit insurance and interest in the interlocutory appeal of that ruling.
amount of $583 million for the quarters ending March 31, 2012
through March 31, 2013. The FDIC asserts these claims based U.S. Bank - Harborview and SURF/OWNIT Repurchase
on BANA’s alleged underreporting of counterparty exposures Litigation
that resulted in underpayment of assessments for those Beginning in 2011, U.S. Bank, National Association (U.S. Bank),
quarters and its Enforcement Section is also conducting a as trustee for the HarborView Mortgage Loan Trust 2005-10 and
parallel investigation related to the same alleged reporting error. various SURF/OWNIT RMBS trusts filed complaints against the
BANA disagrees with the FDIC’s interpretation of the regulations Corporation, Countrywide entities, Merrill Lynch entities and
as they existed during the relevant time period and is defending other affiliates in New York Supreme Court alleging breaches of
itself against the FDIC’s claims. Pending final resolution, BANA representations and warranties. The defendants and certain
has pledged security satisfactory to the FDIC related to the certificate-holders in the trusts agreed to settle the respective
disputed additional assessment amounts. On March 27, 2018, matters in amounts not material to the Corporation, subject to
the U.S. District Court for the District of Columbia denied acceptance by U.S. Bank. The litigations have been stayed
BANA’s partial motion to dismiss certain of the FDIC’s claims. pending finalization of the settlements.
LIBOR, Other Reference Rates, Foreign Exchange (FX) and

Bond Trading Matters
Government authorities in the U.S. and various international
jurisdictions continue to conduct investigations of, to make
inquiries of, and to pursue proceedings against, the Corporation


02.25.2021 22:56PM 62539
NOTE 13 Shareholders’ Equity fixed-rate period, then quarterly during the floating-rate period.
The Series MM preferred stock has a liquidation preference of
Common Stock $25,000 per share and is subject to certain restrictions in the
event the Corporation fails to declare and pay full dividends.
On October 29, 2020, the Corporation issued 44,000
Declared Quarterly Cash Dividends on Common Stock (1) shares of 4.375% Non-Cumulative Preferred Stock, Series NN
Dividend for $1.1 billion, with quarterly dividend payments commencing in
Declaration Date Record Date Payment Date Per Share February 2021. The Series NN preferred stock has a liquidation
January 19, 2021 March 5, 2021 March 26, 2021 $ 0.18 preference of $25,000 per share and is subject to certain
October 21, 2020 December 4, 2020 December 24, 2020 0.18 restrictions in the event the Corporation fails to declare and pay
July 22, 2020 September 4, 2020 September 25, 2020 0.18 full dividends.
April 22, 2020 June 5, 2020 June 26, 2020 0.18
On January 28, 2021, the Corporation issued 36,000 shares
January 29, 2020 March 6, 2020 March 27, 2020 0.18
(1)
of 4.125% Non-Cumulative Preferred Stock, Series PP for
In 2020, and through February 24, 2021.
$915 million, with quarterly dividends commencing in May
The cash dividends paid per share of common stock were $0.72 2021. The Series PP preferred stock has a liquidation
$0.66 and $0.54 for 2020, 2019 and 2018, respectively. preference of $25,000 per share and is subject to certain
The following table summarizes common stock repurchases restrictions in the event the Corporation fails to declare and pay
during 2020, 2019 and 2018. full dividends.
In 2020, the Corporation fully redeemed Series Y preferred
stock for $1.1 billion. Additionally, on January 29, 2021, the
Common Stock Repurchase Summary Corporation fully redeemed Series CC preferred stock for $1.1
(in millions) 2020 2019 2018 billion.
Total share repurchases, including CCAR All series of preferred stock in the Preferred Stock Summary
capital plan repurchases 227 956 676 table have a par value of $0.01 per share, are not subject to
the operation of a sinking fund, have no participation rights, and
Purchase price of shares repurchased
and retired
with the exception of the Series L Preferred Stock, are not
CCAR capital plan repurchases $ 7,025 $ 25,644 $ 16,754 convertible. The holders of the Series B Preferred Stock and
Other authorized repurchases — 2,500 3,340 Series 1 through 5 Preferred Stock have general voting rights
Total shares repurchased $ 7,025 $ 28,144 $ 20,094 and vote together with the common stock. The holders of the
During 2020, the Board of Governors of the Federal Reserve other series included in the table have no general voting rights.
System (Federal Reserve) announced that due to economic All outstanding series of preferred stock of the Corporation have
uncertainty resulting from COVID-19, all large banks would be preference over the Corporation’s common stock with respect to
required to suspend share repurchase programs in the third and the payment of dividends and distribution of the Corporation’s
fourth quarters of 2020, except for repurchases to offset shares assets in the event of a liquidation or dissolution. With the
awarded under equity-based compensation plans, and to limit exception of the Series B, F, G and T Preferred Stock, if any
dividends to existing rates that do not exceed the average of the dividend payable on these series is in arrears for three or more
last four quarters’ net income. semi-annual or six or more quarterly dividend periods, as
The Federal Reserve’s directives regarding share applicable (whether consecutive or not), the holders of these
repurchases aligned with the Corporation's decision to series and any other class or series of preferred stock ranking
voluntarily suspend repurchases during the first half of 2020. equally as to payment of dividends and upon which equivalent
The suspension of the Corporation's repurchases did not voting rights have been conferred and are exercisable (voting as
include repurchases to offset shares awarded under its equity- a single class) will be entitled to vote for the election of two
based compensation plans. additional directors. These voting rights terminate when the
During 2020, the Corporation repurchased and retired 227 Corporation has paid in full dividends on these series for at
million shares of common stock, which reduced shareholders’ least two semi-annual or four quarterly dividend periods, as
equity by $7.0 billion. applicable, following the dividend arrearage.
During 2020, in connection with employee stock plans, the The 7.25% Non-Cumulative Perpetual Convertible Preferred
Corporation issued 66 million shares of its common stock and, Stock, Series L (Series L Preferred Stock) does not have early
to satisfy tax withholding obligations, repurchased 26 million redemption/call rights. Each share of the Series L Preferred
shares of its common stock. At December 31, 2020, the Stock may be converted at any time, at the option of the holder,
Corporation had reserved 513 million unissued shares of into 20 shares of the Corporation’s common stock plus cash in
common stock for future issuances under employee stock lieu of fractional shares. The Corporation may cause some or all
plans, convertible notes and preferred stock. of the Series L Preferred Stock, at its option, at any time or from
time to time, to be converted into shares of common stock at
Preferred Stock the then-applicable conversion rate if, for 20 trading days during
The cash dividends declared on preferred stock were $1.4 any period of 30 consecutive trading days, the closing price of
billion, $1.4 billion and $1.5 billion for 2020, 2019 and 2018, common stock exceeds 130 percent of the then-applicable
respectively. conversion price of the Series L Preferred Stock. If a conversion
On January 24, 2020, the Corporation issued 44,000 shares of Series L Preferred Stock occurs at the option of the holder,
subsequent to a dividend record date but prior to the dividend
of Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series

MM for $1.1 billion. Dividends are paid semi-annually during the payment date, the Corporation will still pay any accrued
dividends payable.


02.25.2021 22:56PM 62539
The table below presents a summary of perpetual preferred stock outstanding at December 31, 2020.
Preferred Stock Summary

(Dollars in millions, except as noted)
Initial Liquidation
Total Preference Dividend per
Issuance Shares per Share Carrying Per Annum Share Annual
Series Description Date Outstanding (in dollars) Value Dividend Rate (in dollars) Dividend Redemption Period (1)
7% Cumulative June
Series B Redeemable 1997 7,110 $ 100 $ 1 7.00 % $ 7 $ — n/a
Floating Rate Non- November On or after
(2) (3)
Series E Cumulative 2006 12,691 25,000 317 3-mo. LIBOR + 35 bps 1.02 13 November 15, 2011
Floating Rate Non- March On or after
Series F Cumulative 2012 1,409 100,000 141 3-mo. LIBOR + 40 bps (3) 4,066.67 6 March 15, 2012
Adjustable Rate Non- March On or after
(3)
Series G Cumulative 2012 4,926 100,000 493 3-mo. LIBOR + 40 bps 4,066.67 20 March 15, 2012
7.25% Non-Cumulative January
Series L Perpetual Convertible 2008 3,080,182 1,000 3,080 7.25 % 72.50 223 n/a
September
Series T 6% Non-cumulative 2011 354 100,000 35 6.00 % 6,000.00 2 After May 7, 2019
5.2% to, but excluding,
Fixed-to-Floating Rate May 6/1/23; 3-mo. LIBOR On or after
Series U (4) Non-Cumulative 2013 40,000 25,000 1,000 + 313.5 bps thereafter 52.00 52 June 1, 2023
Fixed-to-Floating Rate September 9/5/24; 3-mo. LIBOR + On or after
(4)
Series X Non-Cumulative 2014 80,000 25,000 2,000 370.5 bps thereafter 62.50 125 September 5, 2024
Fixed-to-Floating Rate October 10/23/24; 3-mo. LIBOR On or after
Series Z (4) Non-Cumulative 2014 56,000 25,000 1,400 + 417.4 bps thereafter 65.00 91 October 23, 2024
Fixed-to-Floating Rate March 3/17/25; 3-mo. LIBOR + On or after
Series AA (4) Non-Cumulative 2015 76,000 25,000 1,900 389.8 bps thereafter 61.00 116 March 17, 2025
January On or after
Series CC (2) 6.200% Non-Cumulative 2016 44,000 25,000 1,100 6.200 % 1.55 68 January 29, 2021
Series DD (4) Non-Cumulative 2016 40,000 25,000 1,000 455.3 bps thereafter 63.00 63 March 10, 2026
April On or after
Series EE (2) 6.000% Non-Cumulative 2016 36,000 25,000 900 6.000 % 1.50 54 April 25, 2021
Series FF (4) Non-Cumulative 2018 94,000 25,000 2,350 293.1 bps thereafter 58.75 138 March 15, 2028
May On or after
Series GG (2) 6.000% Non-Cumulative 2018 54,000 25,000 1,350 6.000 % 1.50 81 May 16, 2023
July On or after
Series HH (2) 5.875% Non-Cumulative 2018 34,160 25,000 854 5.875 % 1.47 50 July 24, 2023
Fixed-to-Floating Rate June 6/20/24; 3-mo. LIBOR + On or after
Series JJ (4) Non-Cumulative 2019 40,000 25,000 1,000 329.2 bps thereafter 51.25 51 June 20, 2024
June On or after
Series KK (2) 5.375% Non-Cumulative 2019 55,900 25,000 1,398 5.375 % 1.34 75 June 25, 2024
September On or after
Series LL (2) 5.000% Non-Cumulative 2019 52,400 25,000 1,310 5.000 % 1.25 66 September 17, 2024
Fixed-to-Floating Rate January On or after
Series MM (4) Non-Cumulative 2020 44,000 25,000 1,100 4.300 % 43.48 48 January 28, 2025
October On or after
Series NN (2) 4.375% Non-Cumulative 2020 44,000 25,000 1,100 4.375 % 0.29 13 November 3, 2025
(5) (6)
Series 1 Cumulative 2004 3,275 30,000 98 3-mo. LIBOR + 75 bps 0.75 3 November 28, 2009
Series 2 (5) Cumulative 2005 9,967 30,000 299 3-mo. LIBOR + 65 bps (6) 0.76 10 November 28, 2009
Series 4 (5) Cumulative 2005 7,010 30,000 210 3-mo. LIBOR + 75 bps (3) 1.02 9 November 28, 2010
Series 5 (5) Cumulative 2007 14,056 30,000 422 3-mo. LIBOR + 50 bps (3) 1.02 17 May 21, 2012
Issuance costs and certain adjustments (348)
Total 3,931,440 $ 24,510
(1)
The Corporation may redeem series of preferred stock on or after the redemption date, in whole or in part, at its option, at the liquidation preference plus declared and unpaid dividends. Series B
and Series L Preferred Stock do not have early redemption/call rights.
(2)
Ownership is held in the form of depositary shares, each representing a 1/1,000th interest in a share of preferred stock, paying a quarterly cash dividend, if and when declared.
(3)
Subject to 4.00% minimum rate per annum.
(4)
Ownership is held in the form of depositary shares, each representing a 1/25th interest in a share of preferred stock, paying a semi-annual cash dividend, if and when declared, until the first
redemption date at which time, it adjusts to a quarterly cash dividend, if and when declared, thereafter.
(5)
Ownership is held in the form of depositary shares, each representing a 1/1,200th interest in a share of preferred stock, paying a quarterly cash dividend, if and when declared.
(6)
Subject to 3.00% minimum rate per annum.


02.25.2021 22:56PM 62539
NOTE 14 Accumulated Other Comprehensive Income (Loss)

The table below presents the changes in accumulated OCI after-tax for 2020, 2019 and 2018.
Debit Valuation Employee Foreign

(Dollars in millions) Debt Securities Adjustments Derivatives Benefit Plans Currency Total
Balance, December 31, 2017 $ (1,206) $ (1,060) $ (831) $ (3,192) $ (793) $ (7,082)
Accounting change related to certain tax effects (393) (220) (189) (707) 239 (1,270)
Cumulative adjustment for hedge accounting change — — 57 — — 57
Net change (3,953) 749 (53) (405) (254) (3,916)
Balance, December 31, 2018 $ (5,552) $ (531) $ (1,016) $ (4,304) $ (808) $ (12,211)
Net change 5,875 (963) 616 136 (86) 5,578
Balance, December 31, 2019 $ 323 $ (1,494) $ (400) $ (4,168) $ (894) $ (6,633)
Net change 4,799 (498) 826 (98) (52) 4,977
Balance, December 31, 2020 $ 5,122 $ (1,992) $ 426 $ (4,266) $ (946) $ (1,656)
The table below presents the net change in fair value recorded in accumulated OCI, net realized gains and losses reclassified
into earnings and other changes for each component of OCI pre- and after-tax for 2020, 2019 and 2018.
Tax After- Tax After- Tax After-

Pretax effect tax Pretax effect tax Pretax effect tax
Debt securities:
Net increase (decrease) in fair value $ 6,819 $ (1,712) $ 5,107 $ 8,020 $ (2,000) $ 6,020 $ (5,189) $ 1,329 $ (3,860)
Net realized (gains) reclassified into earnings (1) (411) 103 (308) (193) 48 (145) (123) 30 (93)
Net change 6,408 (1,609) 4,799 7,827 (1,952) 5,875 (5,312) 1,359 (3,953)
Debit valuation adjustments:
Net increase (decrease) in fair value (669) 156 (513) (1,276) 289 (987) 952 (224) 728
Net realized losses reclassified into earnings (1) 19 (4) 15 18 6 24 26 (5) 21
Net change (650) 152 (498) (1,258) 295 (963) 978 (229) 749
Derivatives:
Net increase (decrease) in fair value 1,098 (268) 830 692 (156) 536 (232) 74 (158)
Reclassifications into earnings:
Net interest income 6 (1) 5 104 (26) 78 165 (40) 125
Compensation and benefits expense (12) 3 (9) 2 — 2 (27) 7 (20)
Net realized (gains) losses reclassified into earnings (6) 2 (4) 106 (26) 80 138 (33) 105
Net change 1,092 (266) 826 798 (182) 616 (94) 41 (53)
Employee benefit plans:
Net increase (decrease) in fair value (381) 80 (301) 41 (21) 20 (703) 164 (539)
Net actuarial losses and other reclassified into earnings (2) 261 (63) 198 150 (36) 114 171 (46) 125
Settlements, curtailments and other 5 — 5 3 (1) 2 11 (2) 9
Net change (115) 17 (98) 194 (58) 136 (521) 116 (405)
Foreign currency:
Net (decrease) in fair value (251) 199 (52) (13) (52) (65) (8) (195) (203)
Net realized (gains) reclassified into earnings (1) (1) 1 — (110) 89 (21) (149) 98 (51)
Net change (252) 200 (52) (123) 37 (86) (157) (97) (254)
Total other comprehensive income (loss) $ 6,483 $ (1,506) $ 4,977 $ 7,438 $ (1,860) $ 5,578 $ (5,106) $ 1,190 $ (3,916)
(1)
Reclassifications of pretax debt securities, DVA and foreign currency (gains) losses are recorded in other income in the Consolidated Statement of Income.
(2)
Reclassifications of pretax employee benefit plan costs are recorded in other general operating expense in the Consolidated Statement of Income.
NOTE 15 Earnings Per Common Share

The calculation of EPS and diluted EPS for 2020, 2019 and 2018 is presented below. For more information on the calculation of
EPS, see Note 1 – Summary of Significant Accounting Principles.
(In millions, except per share information) 2020 2019 2018

Earnings per common share
Net income $ 17,894 $ 27,430 $ 28,147
Preferred stock dividends (1,421) (1,432) (1,451)
Earnings per common share $ 1.88 $ 2.77 $ 2.64
Diluted earnings per common share

Dilutive potential common shares (1) 43.7 52.4 140.4

Total diluted average common shares issued and outstanding 8,796.9 9,442.9 10,236.9
Diluted earnings per common share $ 1.87 $ 2.75 $ 2.61
(1)
Includes incremental dilutive shares from RSUs, restricted stock and warrants.


02.25.2021 22:56PM 62539
For 2020, 2019 and 2018, 62 million average dilutive the Federal Reserve. The Corporation’s banking entity affiliates
potential common shares associated with the Series L preferred are subject to capital adequacy rules issued by the OCC.
stock were not included in the diluted share count because the The Corporation and its primary banking entity affiliate,
result would have been antidilutive under the “if-converted” BANA, are Advanced approaches institutions under Basel 3. As
method. For 2018, average options to purchase four million Advanced approaches institutions, the Corporation and its
shares of common stock were outstanding but not included in banking entity affiliates are required to report regulatory risk-
the computation of EPS because the result would have been based capital ratios and risk-weighted assets under both the
antidilutive under the treasury stock method. For 2019 and Standardized and Advanced approaches. The approach that
2018, average warrants to purchase three million and 136 yields the lower ratio is used to assess capital adequacy,
million shares of common stock, respectively, were included in including under the Prompt Corrective Action (PCA) framework.
the diluted EPS calculation under the treasury stock method. The Corporation is required to maintain a minimum
Substantially all of these warrants were exercised on or before supplementary leverage ratio (SLR) of 3.0 percent plus a
their expiration date of January 16, 2019. leverage buffer of 2.0 percent in order to avoid certain
restrictions on capital distributions and discretionary bonus
NOTE 16 Regulatory Requirements and payments. The Corporation’s insured depository institution
Restrictions subsidiaries are required to maintain a minimum 6.0 percent
The Federal Reserve, Office of the Comptroller of the Currency SLR to be considered well capitalized under the PCA framework.
(OCC) and FDIC (collectively, U.S. banking regulators) jointly The following table presents capital ratios and related
establish regulatory capital adequacy rules, including Basel 3, information in accordance with Basel 3 Standardized and
for U.S. banking organizations. As a financial holding company, Advanced approaches as measured at December 31, 2020 and
the Corporation is subject to capital adequacy rules issued by 2019 for the Corporation and BANA.
Regulatory Capital under Basel 3

Bank of America Corporation Bank of America, N.A.
Standardized Advanced Regulatory Standardized Advanced Regulatory
Approach (1, 2) Approaches (1) Minimum (3) Approach (1, 2) Approaches (1) Minimum (4)
Common equity tier 1 capital $ 176,660 $ 176,660 $ 164,593 $ 164,593
Tier 1 capital 200,096 200,096 164,593 164,593
Total capital (5) 237,936 227,685 181,370 170,922
Risk-weighted assets (in billions) 1,480 1,371 1,221 1,014
Common equity tier 1 capital ratio 11.9 % 12.9 % 9.5 % 13.5 % 16.2 % 7.0 %
Tier 1 capital ratio 13.5 14.6 11.0 13.5 16.2 8.5
Total capital ratio 16.1 16.6 13.0 14.9 16.9 10.5
Adjusted quarterly average assets (in billions) (6) $ 2,719 $ 2,719 $ 2,143 $ 2,143
Tier 1 leverage ratio 7.4 % 7.4 % 4.0 7.7 % 7.7 % 5.0
(7)
Supplementary leverage exposure (in billions) $ 2,786 $ 2,525
Supplementary leverage ratio 7.2 % 5.0 6.5 % 6.0
December 31, 2019

Common equity tier 1 capital $ 166,760 $ 166,760 $ 154,626 $ 154,626
Tier 1 capital 188,492 188,492 154,626 154,626
Total capital (5) 221,230 213,098 166,567 158,665
Risk-weighted assets (in billions) 1,493 1,447 1,241 991
Common equity tier 1 capital ratio 11.2 % 11.5 % 9.5 % 12.5 % 15.6 % 7.0 %
Tier 1 capital ratio 12.6 13.0 11.0 12.5 15.6 8.5
Total capital ratio 14.8 14.7 13.0 13.4 16.0 10.5
Adjusted quarterly average assets (in billions) (6) $ 2,374 $ 2,374 $ 1,780 $ 1,780
Tier 1 leverage ratio 7.9 % 7.9 % 4.0 8.7 % 8.7 % 5.0
Supplementary leverage exposure (in billions) $ 2,946 $ 2,177

Supplementary leverage ratio 6.4 % 5.0 7.1 % 6.0
(1)
(2)
2019.
(3)
The capital conservation buffer and global systemically important bank surcharge were 2.5 percent at both December 31, 2020 and 2019. At December 31, 2020, the Corporation's stress capital
buffer of 2.5 percent was applied in place of the capital conservation buffer under the Standardized approach. The countercyclical capital buffer for both periods was zero. The SLR minimum
includes a leverage buffer of 2.0 percent.
(4)
Risk-based capital regulatory minimums at December 31, 2020 and 2019 are the minimum ratios under Basel 3, including a capital conservation buffer of 2.5 percent. The regulatory minimums
for the leverage ratios as of both period ends are the percent required to be considered well capitalized under the PCA framework.
(5)
losses.
(6)
(7)
Supplementary leverage exposure for the Corporation at December 31, 2020 reflects the temporary exclusion of U.S. Treasury securities and deposits at Federal Reserve Banks.


02.25.2021 22:56PM 62539
The capital adequacy rules issued by the U.S. banking of any such dividend declaration. Bank of America California,
regulators require institutions to meet the established N.A. can pay dividends of $198 million in 2021 plus an
minimums outlined in the table above. Failure to meet the additional amount equal to its retained net profits for 2021 up
minimum requirements can lead to certain mandatory and to the date of any such dividend declaration.
discretionary actions by regulators that could have a material
adverse impact on the Corporation’s financial position. At NOTE 17 Employee Benefit Plans
December 31, 2020 and 2019, the Corporation and its banking
entity affiliates were well capitalized. Pension and Postretirement Plans
In response to the uncertainty arising from the pandemic, The Corporation sponsors a qualified noncontributory trusteed
the Federal Reserve required all large banks to suspend share pension plan (Qualified Pension Plan), a number of
repurchase programs during the second half of 2020, except for noncontributory nonqualified pension plans, and postretirement
repurchases to offset shares awarded under equity-based health and life plans that cover eligible employees. Non-U.S.
compensation plans, and to limit common stock dividends to pension plans sponsored by the Corporation vary based on the
existing rates that did not exceed the average of the last four country and local practices.
quarters’ net income. In December 2020, the Federal Reserve The Qualified Pension Plan has a balance guarantee feature
announced that beginning in the first quarter of 2021, large for account balances with participant-selected investments,
banks would be permitted to pay common stock dividends at applied at the time a benefit payment is made from the plan
existing rates and to repurchase shares in an amount that, that effectively provides principal protection for participant
when combined with dividends paid, does not exceed the balances transferred and certain compensation credits. The
average of net income over the last four quarters. For more Corporation is responsible for funding any shortfall on the
information, see Note 13 – Shareholders’ Equity. guarantee feature.
Benefits earned under the Qualified Pension Plan have been
Other Regulatory Matters frozen. Thereafter, the cash balance accounts continue to earn
The Federal Reserve requires the Corporation’s bank investment credits or interest credits in accordance with the
subsidiaries to maintain reserve requirements based on a terms of the plan document.
percentage of certain deposit liabilities. The average daily The Corporation has an annuity contract that guarantees the
reserve balance requirements, in excess of vault cash, payment of benefits vested under a terminated U.S. pension
maintained by the Corporation with the Federal Reserve Bank plan (Other Pension Plan). The Corporation, under a
were $3.8 billion for 2020, reflecting the Federal Reserve's supplemental agreement, may be responsible for or benefit from
reduction of the reserve requirement to zero in the first quarter actual experience and investment performance of the annuity
due to COVID-19, and $14.6 billion for 2019. At December 31, assets. The Corporation made no contribution under this
2020 and 2019, the Corporation had cash and cash agreement in 2020 or 2019. Contributions may be required in
equivalents in the amount of $4.9 billion and $6.3 billion, and the future under this agreement.
securities with a fair value of $16.8 billion and $14.7 billion The Corporation’s noncontributory, nonqualified pension
that were segregated in compliance with securities regulations. plans are unfunded and provide supplemental defined pension
Cash held on deposit with the Federal Reserve Bank to meet benefits to certain eligible employees.
reserve requirements and cash and cash equivalents In addition to retirement pension benefits, certain benefits-
segregated in compliance with securities regulations are eligible employees may become eligible to continue participation
components of restricted cash. For more information, see Note as retirees in health care and/or life insurance plans sponsored
10 – Federal Funds Sold or Purchased, Securities Financing by the Corporation. These plans are referred to as the
Agreements, Short-term Borrowings and Restricted Cash. In Postretirement Health and Life Plans.
addition, at December 31, 2020 and 2019, the Corporation had The Pension and Postretirement Plans table summarizes the
cash deposited with clearing organizations of $10.9 billion and changes in the fair value of plan assets, changes in the
$7.6 billion primarily recorded in other assets on the projected benefit obligation (PBO), the funded status of both the
Consolidated Balance Sheet. accumulated benefit obligation (ABO) and the PBO, and the
weighted-average assumptions used to determine benefit
Bank Subsidiary Distributions obligations for the pension plans and postretirement plans at
The primary sources of funds for cash distributions by the December 31, 2020 and 2019. The estimate of the
Corporation to its shareholders are capital distributions received Corporation’s PBO associated with these plans considers
from its bank subsidiaries, BANA and Bank of America various actuarial assumptions, including assumptions for
California, N.A. In 2020, the Corporation received dividends of mortality rates and discount rates. The discount rate
$10.3 billion from BANA and $62 million from Bank of America assumptions are derived from a cash flow matching technique
California, N.A. that utilizes rates that are based on Aa-rated corporate bonds
The amount of dividends that a subsidiary bank may declare with cash flows that match estimated benefit payments of each
in a calendar year without OCC approval is the subsidiary bank’s of the plans. The decreases in the weighted-average discount
net profits for that year combined with its retained net profits for rates in 2020 and 2019 resulted in increases to the PBO of
the preceding two years. Retained net profits, as defined by the approximately $1.9 billion and $2.2 billion at December 31,
OCC, consist of net income less dividends declared during the 2020 and 2019. Significant gains and losses related to
period. In 2021, BANA can declare and pay dividends of changes in the PBO for 2020 and 2019 primarily resulted from
approximately $10.3 billion to the Corporation plus an additional changes in the discount rate.
amount equal to its retained net profits for 2021 up to the date


02.25.2021 22:56PM 62539
Pension and Postretirement Plans (1)

Qualified Non-U.S. Nonqualified and Other Postretirement
Pension Plan Pension Plans Pension Plans Health and Life Plans
Fair value, January 1 $ 20,275 $ 18,178 $ 2,696 $ 2,461 $ 2,666 $ 2,584 $ 199 $ 252
Actual return on plan assets 2,468 3,187 379 273 285 228 1 5
Company contributions — — 23 20 86 91 6 24
Plan participant contributions — — 1 1 — — 110 103
Settlements and curtailments — — (61) (42) — — — —
Benefits paid (967) (1,090) (57) (108) (248) (237) (174) (185)
Federal subsidy on benefits paid n/a n/a n/a n/a n/a n/a 1 —
Foreign currency exchange rate changes n/a n/a 97 91 n/a n/a n/a n/a
Fair value, December 31 $ 21,776 $ 20,275 $ 3,078 $ 2,696 $ 2,789 $ 2,666 $ 143 $ 199
Change in projected benefit obligation
Projected benefit obligation, January 1 $ 15,361 $ 14,144 $ 2,887 $ 2,589 $ 2,919 $ 2,779 $ 989 $ 928
Service cost — — 20 17 1 1 5 5
Interest cost 500 593 49 65 90 113 32 38
Plan participant contributions — — 1 1 — — 110 103
Plan amendments — — 3 2 — — — —
Settlements and curtailments — — (61) (42) — — — —
Actuarial loss 1,533 1,714 396 288 243 263 43 99
Benefits paid (967) (1,090) (57) (108) (248) (237) (173) (185)
Federal subsidy on benefits paid n/a n/a n/a n/a n/a n/a 1 —
Foreign currency exchange rate changes n/a n/a 102 75 n/a n/a — 1
Projected benefit obligation, December 31 $ 16,427 $ 15,361 $ 3,340 $ 2,887 $ 3,005 $ 2,919 $ 1,007 $ 989
Amounts recognized on Consolidated Balance Sheet
Other assets $ 5,349 $ 4,914 $ 428 $ 364 $ 812 $ 733 $ — $ —
Accrued expenses and other liabilities — — (690) (555) (1,028) (986) (864) (790)
Net amount recognized, December 31 $ 5,349 $ 4,914 $ (262) $ (191) $ (216) $ (253) $ (864) $ (790)
Funded status, December 31
Accumulated benefit obligation $ 16,427 $ 15,361 $ 3,253 $ 2,841 $ 3,005 $ 2,919 n/a n/a
Overfunded (unfunded) status of ABO 5,349 4,914 (175) (145) (216) (253) n/a n/a
Provision for future salaries — — 87 46 — — n/a n/a
Projected benefit obligation 16,427 15,361 3,340 2,887 3,005 2,919 $ 1,007 $ 989
Weighted-average assumptions, December 31
Discount rate 2.57 % 3.32 % 1.37 % 1.81 % 2.33 % 3.20 % 2.48 % 3.27 %
Rate of compensation increase n/a n/a 4.11 4.10 4.00 4.00 n/a n/a
Interest-crediting rate 5.02 % 5.06 % 1.58 1.53 4.49 4.52 n/a n/a
(1)
The measurement date for all of the above plans was December 31 of each year reported.
The Corporation’s estimate of its contributions to be made required by the Employee Retirement Income Security Act of
to the Non-U.S. Pension Plans, Nonqualified and Other Pension 1974 (ERISA).
Plans, and Postretirement Health and Life Plans in 2021 is $29 Pension Plans with ABO and PBO in excess of plan assets as
million, $93 million and $14 million, respectively. The of December 31, 2020 and 2019 are presented in the table
Corporation does not expect to make a contribution to the below. For these plans, funding strategies vary due to legal
Qualified Pension Plan in 2021. It is the policy of the requirements and local practices.
Corporation to fund no less than the minimum funding amount
Plans with ABO and PBO in Excess of Plan Assets

Nonqualified
Non-U.S. and Other
Pension Plans Pension Plans
PBO $ 900 $ 744 $ 1,028 $ 988
ABO 841 720 1,028 988
Fair value of plan assets 211 191 1 1


02.25.2021 22:56PM 62539
Components of Net Periodic Benefit Cost

Qualified Pension Plan Non-U.S. Pension Plans
Components of net periodic benefit cost (income)
Service cost $ — $ — $ — $ 20 $ 17 $ 19
Interest cost 500 593 563 49 65 65
Expected return on plan assets (1,154) (1,088) (1,136) (66) (99) (126)
Amortization of net actuarial loss 173 135 147 9 6 10
Other — — — 8 4 12
Net periodic benefit cost (income) $ (481) $ (360) $ (426) $ 20 $ (7) $ (20)
Weighted-average assumptions used to determine net cost for years ended December 31
Discount rate 3.32 % 4.32 % 3.68 % 1.81 % 2.60 % 2.39 %
Expected return on plan assets 6.00 6.00 6.00 2.57 4.13 4.37
Rate of compensation increase n/a n/a n/a 4.10 4.49 4.31
Nonqualified and Postretirement Health

Other Pension Plans and Life Plans
Components of net periodic benefit cost (income)
Service cost $ 1 $ 1 $ 1 $ 5 $ 5 $ 6
Interest cost 90 113 105 32 38 36
Expected return on plan assets (71) (95) (84) (4) (5) (6)
Amortization of net actuarial loss (gain) 50 34 43 29 (24) (27)
Other — — — (2) (2) (3)
Net periodic benefit cost (income) $ 70 $ 53 $ 65 $ 60 $ 12 $ 6
Weighted-average assumptions used to determine net cost for years ended December 31
Discount rate 3.20 % 4.26 % 3.58 % 3.27 % 4.25 % 3.58 %
Expected return on plan assets 2.77 3.73 3.19 2.00 2.00 2.00
Rate of compensation increase 4.00 4.00 4.00 n/a n/a n/a
The asset valuation method used to calculate the expected Assumed health care cost trend rates affect the
return on plan assets component of net periodic benefit cost for postretirement benefit obligation and benefit cost reported for
the Qualified Pension Plan recognizes 60 percent of the prior the Postretirement Health and Life Plans. The assumed health
year’s market gains or losses at the next measurement date care cost trend rate used to measure the expected cost of
with the remaining 40 percent spread equally over the benefits covered by the Postretirement Health and Life Plans is
subsequent four years. 6.25 percent for 2021, reducing in steps to 5.00 percent in
Gains and losses for all benefit plans except postretirement 2026 and later years.
health care are recognized in accordance with the standard The Corporation’s net periodic benefit cost (income)
amortization provisions of the applicable accounting guidance. recognized for the plans is sensitive to the discount rate and
Net periodic postretirement health and life expense was expected return on plan assets. For the Qualified Pension Plan,
determined using the “projected unit credit” actuarial method. Non-U.S. Pension Plans, Nonqualified and Other Pension Plans,
For the Postretirement Health and Life Plans, 50 percent of the and Postretirement Health and Life Plans, a 25 bp decline in
unrecognized gain or loss at the beginning of the year (or at discount rates and expected return on assets would not have
subsequent remeasurement) is recognized on a level basis had a significant impact on the net periodic benefit cost for
during the year. 2020.
Pretax Amounts included in Accumulated OCI and OCI
Nonqualified Postretirement
Qualified Non-U.S. and Other Health and
Pension Plan Pension Plans Pension Plans Life Plans Total
(Dollars in millions) 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019
Net actuarial loss (gain) $ 3,912 $ 3,865 $ 628 $ 559 $ 987 $ 1,008 $ 66 $ 48 $ 5,593 $ 5,480
Prior service cost (credits) — — 18 18 — — (4) (6) 14 12
Amounts recognized in accumulated OCI $ 3,912 $ 3,865 $ 646 $ 577 $ 987 $ 1,008 $ 62 $ 42 $ 5,607 $ 5,492
Current year actuarial loss (gain) $ 219 $ (385) $ 79 $ 110 $ 29 $ 130 $ 47 $ 99 $ 374 $ (46)
Amortization of actuarial gain (loss) and
prior service cost (173) (135) (12) (7) (50) (34) (27) 26 (262) (150)
Current year prior service cost (credit) — — 3 2 — — — — 3 2
Amounts recognized in OCI $ 46 $ (520) $ 70 $ 105 $ (21) $ 96 $ 20 $ 125 $ 115 $ (194)


02.25.2021 22:56PM 62539
Plan Assets allocation strategy is designed to achieve a higher return than

The Qualified Pension Plan has been established as a the lowest risk strategy.
retirement vehicle for participants, and trusts have been The expected rate of return on plan assets assumption was
established to secure benefits promised under the Qualified developed through analysis of historical market returns,
Pension Plan. The Corporation’s policy is to invest the trust historical asset class volatility and correlations, current market
assets in a prudent manner for the exclusive purpose of conditions, anticipated future asset allocations, the funds’ past
providing benefits to participants and defraying reasonable experience and expectations on potential future market returns.
expenses of administration. The Corporation’s investment The expected return on plan assets assumption is determined
strategy is designed to provide a total return that, over the long using the calculated market-related value for the Qualified
term, increases the ratio of assets to liabilities. The strategy Pension Plan and the Other Pension Plan and the fair value for
attempts to maximize the investment return on assets at a level the Non-U.S. Pension Plans and Postretirement Health and Life
of risk deemed appropriate by the Corporation while complying Plans. The expected return on plan assets assumption
with ERISA and any applicable regulations and laws. The represents a long-term average view of the performance of the
investment strategy utilizes asset allocation as a principal assets in the Qualified Pension Plan, the Non-U.S. Pension
determinant for establishing the risk/return profile of the Plans, the Other Pension Plan, and Postretirement Health and
assets. Asset allocation ranges are established, periodically Life Plans, a return that may or may not be achieved during any
reviewed and adjusted as funding levels and liability one calendar year. The Other Pension Plan is invested solely in
characteristics change. Active and passive investment an annuity contract, which is primarily invested in fixed-income
managers are employed to help enhance the risk/return profile securities structured such that asset maturities match the
of the assets. An additional aspect of the investment strategy duration of the plan’s obligations.
used to minimize risk (part of the asset allocation plan) includes The target allocations for 2021 by asset category for the
matching the exposure of participant-selected investment Qualified Pension Plan, Non-U.S. Pension Plans, and
measures. Nonqualified and Other Pension Plans are presented in the
The assets of the Non-U.S. Pension Plans are primarily following table. Equity securities for the Qualified Pension Plan
attributable to a U.K. pension plan. This U.K. pension plan’s include common stock of the Corporation in the amounts of
assets are invested prudently so that the benefits promised to $274 million (1.26 percent of total plan assets) and $315
members are provided with consideration given to the nature million (1.55 percent of total plan assets) at December 31,
and the duration of the plans' liabilities. The selected asset 2020 and 2019.
2021 Target Allocation

Percentage
Nonqualified
Qualified Non-U.S. and Other
Asset Category Pension Plan Pension Plans Pension Plans
Equity securities 15 - 50% 0 - 25% 0 - 5%
Debt securities 45 - 80% 40 - 70% 95 - 100%
Real estate 0 - 10% 0 - 15% 0 - 5%
Other 0 - 5% 10 - 40% 0 - 5%
Fair Value Measurements

For more information on fair value measurements, including descriptions of Level 1, 2 and 3 of the fair value hierarchy and the
valuation methods employed by the Corporation, see Note 1 – Summary of Significant Accounting Principles and Note 20 – Fair Value
Measurements. Combined plan investment assets measured at fair value by level and in total at December 31, 2020 and 2019 are
summarized in the Fair Value Measurements table.


02.25.2021 22:56PM 62539

Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
Cash and short-term investments
Money market and interest-bearing cash $ 1,380 $ — $ — $ 1,380 $ 1,426 $ — $ — $ 1,426
Cash and cash equivalent commingled/mutual funds — 383 — 383 — 250 — 250
Fixed income
U.S. government and agency securities 4,590 1,238 7 5,835 4,403 890 8 5,301
Corporate debt securities — 5,021 — 5,021 — 3,676 — 3,676
Asset-backed securities — 1,967 — 1,967 — 2,684 — 2,684
Non-U.S. debt securities 1,021 1,122 — 2,143 748 1,015 — 1,763
Fixed income commingled/mutual funds 1,224 1,319 — 2,543 804 1,439 — 2,243
Equity
Common and preferred equity securities 4,438 — — 4,438 4,655 — — 4,655
Equity commingled/mutual funds 134 1,542 — 1,676 147 1,355 — 1,502
Public real estate investment trusts 73 — — 73 91 — — 91
Real estate
Real estate commingled/mutual funds — 20 943 963 — 18 927 945
Limited partnerships — 184 83 267 — 173 90 263
Other investments (1) 5 401 691 1,097 11 390 636 1,037
Total plan investment assets, at fair value $ 12,865 $ 13,197 $ 1,724 $ 27,786 $ 12,285 $ 11,890 $ 1,661 $ 25,836
(1)
Other investments include commodity and balanced funds of $246 million and $233 million, insurance annuity contracts of $664 million and $614 million and other various investments of $187
million and $190 million at December 31, 2020 and 2019.
The Level 3 Fair Value Measurements table presents a reconciliation of all plan investment assets measured at fair value using
significant unobservable inputs (Level 3) during 2020, 2019 and 2018.
Level 3 Fair Value Measurements
Actual Return on
Plan Assets Still
Balance Held at the Purchases, Sales Balance
January 1 Reporting Date and Settlements December 31
Fixed income
U.S. government and agency securities $ 8 $ — $ (1) $ 7
Real estate
Real estate commingled/mutual funds 927 (4) 20 943
Limited partnerships 90 2 (9) 83
Other investments 636 6 49 691
Total $ 1,661 $ 4 $ 59 $ 1,724
2019
Fixed income
U.S. government and agency securities $ 9 $ — $ (1) $ 8
Real estate
Private real estate 5 — (5) —
Real estate commingled/mutual funds 885 33 9 927
Limited partnerships 82 — 8 90
Other investments 588 6 42 636
Total $ 1,569 $ 39 $ 53 $ 1,661
2018
Fixed income
U.S. government and agency securities $ 9 $ — $ — $ 9
Real estate
Private real estate 93 (7) (81) 5
Real estate commingled/mutual funds 831 52 2 885
Limited partnerships 85 (12) 9 82
Other investments 74 — 514 588
Total $ 1,092 $ 33 $ 444 $ 1,569
Projected Benefit Payments

Benefit payments projected to be made from the Qualified Pension Plan, Non-U.S. Pension Plans, Nonqualified and Other Pension
Plans, and Postretirement Health and Life Plans are presented in the table below.


02.25.2021 22:56PM 62539
Projected Benefit Payments
Nonqualified Postretirement
Qualified Non-U.S. and Other Health and
(Dollars in millions) Pension Plan (1) Pension Plans (2) Pension Plans (2) Life Plans (3)
2021 $ 856 $ 127 $ 244 $ 79
2022 943 134 245 76
2023 939 143 229 74
2024 943 135 224 70
2025 934 140 221 67
2026 - 2030 4,474 675 977 290
(1)
Benefit payments expected to be made from the plan’s assets.
(2)
Benefit payments expected to be made from a combination of the plans’ and the Corporation’s assets.
(3)
Benefit payments (net of retiree contributions) expected to be made from a combination of the plans’ and the Corporation’s assets.
Defined Contribution Plans 2020, 2019 and 2018, respectively. At December 31, 2020,
The Corporation maintains qualified and non-qualified defined there was an estimated $2.0 billion of total unrecognized
contribution retirement plans. The Corporation recorded expense compensation cost related to certain share-based compensation
of $1.2 billion, $1.0 billion and $1.0 billion in 2020, 2019 and awards that is expected to be recognized over a period of up to
2018 related to the qualified defined contribution plans. At both four years, with a weighted-average period of 2.2 years.
December 31, 2020 and 2019, 189 million shares of the
Corporation’s common stock were held by these plans.
Restricted Stock and Restricted Stock Units
Payments to the plans for dividends on common stock were The total fair value of restricted stock and restricted stock units
$138 million, $133 million and $115 million in 2020, 2019 and vested in 2020, 2019 and 2018 was $2.3 billion, $2.6 billion
2018, respectively. and $2.3 billion, respectively. The table below presents the
Certain non-U.S. employees are covered under defined status at December 31, 2020 of the share-settled restricted
contribution pension plans that are separately administered in stock and restricted stock units and changes during 2020.
accordance with local laws.
Stock-settled Restricted Stock and Restricted Stock
NOTE 18 Stock-based Compensation Plans Units
The Corporation administers a number of equity compensation
plans, with awards being granted predominantly from the Bank Weighted-
of America Key Employee Equity Plan (KEEP). Under this plan, average Grant
Shares/Units Date Fair Value
600 million shares of the Corporation’s common stock are Outstanding at January 1, 2020 157,909,315 $ 27.93
authorized to be used for grants of awards. Granted 83,604,782 33.01
During 2020 and 2019, the Corporation granted 86 million Vested (68,578,284) 27.38
and 94 million RSU awards to certain employees under the Canceled (4,982,584) 30.88
KEEP. These RSUs were authorized to settle predominantly in Outstanding at December 31, 2020 167,953,229 30.60
shares of common stock of the Corporation. Certain RSUs will
be settled in cash or contain settlement provisions that subject Cash-settled Restricted Units
these awards to variable accounting whereby compensation At December 31, 2020, approximately two million cash-settled
expense is adjusted to fair value based on changes in the share restricted units remain outstanding. In 2020, 2019 and 2018,
price of the Corporation’s common stock up to the settlement the amount of cash paid to settle the RSUs that vested was
date. Of the RSUs granted in 2020 and 2019, 61 million and $81 million, $84 million and $1.3 billion, respectively.
71 million will vest predominantly over three years with most
vesting occurring in one-third increments on each of the first NOTE 19 Income Taxes
three anniversaries of the grant date provided that the employee The components of income tax expense for 2020, 2019 and
remains continuously employed with the Corporation during that 2018 are presented in the table below.
time, and will be expensed ratably over the vesting period, net
of estimated forfeitures, for non-retirement eligible employees
based on the grant-date fair value of the shares. For RSUs Income Tax Expense
granted to employees who are retirement eligible, the awards (Dollars in millions) 2020 2019 2018
are deemed authorized as of the beginning of the year preceding Current income tax expense
the grant date when the incentive award plans are generally U.S. federal $ 1,092 $ 1,136 $ 816
approved. As a result, the estimated value is expensed ratably U.S. state and local 1,076 901 1,377
over the year preceding the grant date. Additionally, 25 million Non-U.S. 670 852 1,203
and 23 million of the RSUs granted in 2020 and 2019 will vest Total current expense 2,838 2,889 3,396
predominantly over four years with most vesting occurring in Deferred income tax expense
one-fourth increments on each of the first four anniversaries of U.S. federal (799) 2,001 2,579
U.S. state and local (233) 223 240
the grant date provided that the employee remains continuously
Non-U.S. (705) 211 222
employed with the Corporation during that time, and will be Total deferred expense (1,737) 2,435 3,041
expensed ratably over the vesting period, net of estimated Total income tax expense $ 1,101 $ 5,324 $ 6,437
forfeitures, based on the grant-date fair value of the shares.
The compensation cost for the stock-based plans was $2.1 Total income tax expense does not reflect the tax effects of
billion, $2.1 billion and $1.8 billion, and the related income tax items that are included in OCI each period. For more
benefit was $505 million, $511 million and $433 million for

02.25.2021 22:56PM 62539
information, see Note 14 – Accumulated Other Comprehensive statutory tax rate was 21 percent for 2020, 2019 and 2018. A
Income (Loss). Other tax effects included in OCI each period reconciliation of the expected U.S. federal income tax expense,
resulted in an expense of $1.5 billion and $1.9 billion in 2020 calculated by applying the federal statutory tax rate, to the
and 2019 and a benefit of $1.2 billion in 2018. Corporation’s actual income tax expense, and the effective tax
Income tax expense for 2020, 2019 and 2018 varied from rates for 2020, 2019 and 2018 are presented in the table
the amount computed by applying the statutory income tax rate below.
to income before income taxes. The Corporation’s federal
Reconciliation of Income Tax Expense

Amount Percent Amount Percent Amount Percent
Expected U.S. federal income tax expense $ 3,989 21.0 % $ 6,878 21.0 % $ 7,263 21.0 %
Increase (decrease) in taxes resulting from:
State tax expense, net of federal benefit 728 3.8 1,283 3.9 1,367 4.0
Affordable housing/energy/other credits (2,869) (15.1) (2,365) (7.2) (1,888) (5.5)
Tax law changes (699) (3.7) — — — —
Tax-exempt income, including dividends (346) (1.8) (433) (1.3) (413) (1.2)
Share-based compensation (129) (0.7) (225) (0.7) (257) (0.7)
Changes in prior-period UTBs, including interest (41) (0.2) (613) (1.9) 144 0.4
Nondeductible expenses 324 1.7 290 0.9 302 0.9
Rate differential on non-U.S. earnings 218 1.1 504 1.5 98 0.3
Other (74) (0.3) 5 0.1 (179) (0.6)
Total income tax expense (benefit) $ 1,101 5.8 % $ 5,324 16.3 % $ 6,437 18.6 %
The reconciliation of the beginning unrecognized tax benefits It is reasonably possible that the UTB balance may decrease
(UTB) balance to the ending balance is presented in the by as much as $166 million during the next 12 months, since
following table. resolved items will be removed from the balance whether their
resolution results in payment or recognition.
The Corporation recognized interest expense of $9 million in
Reconciliation of the Change in Unrecognized Tax 2020, an interest benefit of $19 million in 2019 and interest
Benefits expense of $43 million in 2018. At December 31, 2020 and
2019, the Corporation’s accrual for interest and penalties that
Balance, January 1 $ 1,175 $ 2,197 $ 1,773 related to income taxes, net of taxes and remittances, was
Increases related to positions taken $130 million and $147 million.
during the current year 238 238 395 The Corporation files income tax returns in more than 100
Increases related to positions taken state and non-U.S. jurisdictions each year. The IRS and other
during prior years (1) 99 401 406
tax authorities in countries and states in which the Corporation
Decreases related to positions
taken during prior years (1) (172) (1,102) (371) has significant business operations examine tax returns
Settlements — (541) (6) periodically (continuously in some jurisdictions). The following
Expiration of statute of limitations — (18) — table summarizes the status of examinations by major
Balance, December 31 $ 1,340 $ 1,175 $ 2,197 jurisdiction for the Corporation and various subsidiaries at
(1)
The sum of the positions taken during prior years differs from the $(41) million, $(613) December 31, 2020.
million and $144 million in the Reconciliation of Income Tax Expense table due to temporary
items, state items and jurisdictional offsets, as well as the inclusion of interest in the
Reconciliation of Income Tax Expense table. Tax Examination Status
At December 31, 2020, 2019 and 2018, the balance of the Status at
Corporation’s UTBs which would, if recognized, affect the Years under December 31
Corporation’s effective tax rate was $976 million, $814 million Examination (1) 2020
United States 2017-2020 Field Examination
and $1.6 billion, respectively. Included in the UTB balance are
California 2012-2017 Field Examination
some items the recognition of which would not affect the
New York 2016-2018 Field Examination
effective tax rate, such as the tax effect of certain temporary United Kingdom (2) 2018 Field Examination
differences, the portion of gross state UTBs that would be offset (1)
All tax years subsequent to the years shown remain subject to examination.
by the tax benefit of the associated federal deduction and the (2)
Field examination for tax year 2019 to begin in 2021.
portion of gross non-U.S. UTBs that would be offset by tax
reductions in other jurisdictions. Significant components of the Corporation’s net deferred tax
assets and liabilities at December 31, 2020 and 2019 are
presented in the following table.


02.25.2021 22:56PM 62539
differences associated with investments in non-U.S.

Deferred Tax Assets and Liabilities subsidiaries that are essentially permanent in duration. If the
December 31
Corporation were to record the associated deferred tax liability,
(Dollars in millions) 2020 2019 the amount would be approximately $1.0 billion.
Deferred tax assets
Net operating loss carryforwards $ 7,717 $ 7,417 NOTE 20 Fair Value Measurements
Allowance for credit losses 4,701 2,354 Under applicable accounting standards, fair value is defined as
Security, loan and debt valuations 2,571 1,860 the exchange price that would be received for an asset or paid
Lease liability 2,400 2,321 to transfer a liability (an exit price) in the principal or most
Employee compensation and retirement benefits 1,582 1,622 advantageous market for the asset or liability in an orderly
Accrued expenses 1,481 1,719
transaction between market participants on the measurement
Credit carryforwards 484 183
Other 1,412 1,203
date. The Corporation determines the fair values of its financial
Gross deferred tax assets 22,348 18,679 instruments under applicable accounting standards that require
Valuation allowance (2,346) (1,989) an entity to maximize the use of observable inputs and minimize
Total deferred tax assets, net of valuation the use of unobservable inputs. The Corporation categorizes its
allowance 20,002 16,690 financial instruments into three levels based on the established
fair value hierarchy and conducts a review of fair value hierarchy
Deferred tax liabilities
classifications on a quarterly basis. Transfers into or out of fair
Equipment lease financing 3,101 2,933
Right-to-use asset 2,296 2,246
value hierarchy classifications are made if the significant inputs
Fixed assets 1,957 1,505 used in the financial models measuring the fair values of the
ESG-related tax credit investments 1,930 1,577 assets and liabilities become unobservable or observable in the
Available-for-sale securities 1,701 100 current marketplace. For more information regarding the fair
Other 1,570 1,885 value hierarchy and how the Corporation measures fair value,
Gross deferred tax liabilities 12,555 10,246 see Note 1 – Summary of Significant Accounting Principles. The
Net deferred tax assets $ 7,447 $ 6,444 Corporation accounts for certain financial instruments under the
fair value option. For more information, see Note 21 – Fair Value
On January 1, 2020, the Corporation adopted the CECL Option.
accounting standard. The transition adjustment included a tax
benefit of $760 million in retained earnings, which increased Valuation Techniques
deferred tax assets by a corresponding amount. The following sections outline the valuation methodologies for
The table below summarizes the deferred tax assets and the Corporation’s assets and liabilities. While the Corporation
related valuation allowances recognized for the net operating believes its valuation methods are appropriate and consistent
loss (NOL) and tax credit carryforwards at December 31, 2020. with other market participants, the use of different
methodologies or assumptions to determine the fair value of
Net Operating Loss and Tax Credit Carryforward Deferred certain financial instruments could result in a different estimate
Tax Assets of fair value at the reporting date.
During 2020, there were no significant changes to valuation
Net approaches or techniques that had, or are expected to have, a
Deferred Valuation Deferred First Year material impact on the Corporation’s consolidated financial
(Dollars in millions) Tax Asset Allowance Tax Asset Expiring
Net operating losses -
position or results of operations.
U.S. $ 36 $ — $ 36 After 2028
Trading Account Assets and Liabilities and Debt Securities
U.K. (1) 5,896 — 5,896 None The fair values of trading account assets and liabilities are
Net operating losses - primarily based on actively traded markets where prices are
other non-U.S. 506 (441) 65 Various based on either direct market quotes or observed transactions.
U.S. states (2) 1,279 (579) Various
The fair values of debt securities are generally based on quoted
700
Foreign tax credits 484 (484) — After 2028 market prices or market prices for similar assets. Liquidity is a
(1) significant factor in the determination of the fair values of
Represents U.K. broker-dealer net operating losses that may be carried forward indefinitely.
(2)
The net operating losses and related valuation allowances for U.S. states before considering trading account assets and liabilities and debt securities.
the benefit of federal deductions were $1.6 billion and $733 million. Market price quotes may not be readily available for some
Management concluded that no valuation allowance was positions such as positions within a market sector where
necessary to reduce the deferred tax assets related to the U.K. trading activity has slowed significantly or ceased. Some of
NOL carryforwards and U.S. federal and certain state NOL these instruments are valued using a discounted cash flow
carryforwards since estimated future taxable income will be model, which estimates the fair value of the securities using
sufficient to utilize these assets prior to their expiration. The internal credit risk, and interest rate and prepayment risk
majority of the Corporation’s U.K. net deferred tax assets, which models that incorporate management’s best estimate of current
consist primarily of NOLs, are expected to be realized by certain key assumptions such as default rates, loss severity and
subsidiaries over an extended number of years. Management’s prepayment rates. Principal and interest cash flows are
conclusion is supported by financial results, profit forecasts for discounted using an observable discount rate for similar
the relevant entities and the indefinite period to carry forward instruments with adjustments that management believes a
NOLs. However, a material change in those estimates could market participant would consider in determining fair value for
lead management to reassess such valuation allowance the specific security. Other instruments are valued using a net
conclusions. asset value approach which considers the value of the
At December 31, 2020, U.S. federal income taxes had not underlying securities. Underlying assets are valued using
been provided on approximately $5.0 billion of temporary external pricing services, where available, or matrix pricing


02.25.2021 22:56PM 62539
based on the vintages and ratings. Situations of illiquidity Loans Held-for-sale

generally are triggered by the market’s perception of credit The fair values of LHFS are based on quoted market prices,
uncertainty regarding a single company or a specific market where available, or are determined by discounting estimated
sector. In these instances, fair value is determined based on cash flows using interest rates approximating the Corporation’s
limited available market information and other factors, current origination rates for similar loans adjusted to reflect the
principally from reviewing the issuer’s financial statements and inherent credit risk. The borrower-specific credit risk is
changes in credit ratings made by one or more rating agencies. embedded within the quoted market prices or is implied by
considering loan performance when selecting comparables.
Derivative Assets and Liabilities
The fair values of derivative assets and liabilities traded in the Short-term Borrowings and Long-term Debt
OTC market are determined using quantitative models that The Corporation issues structured liabilities that have coupons
utilize multiple market inputs including interest rates, prices and or repayment terms linked to the performance of debt or equity
indices to generate continuous yield or pricing curves and securities, interest rates, indices, currencies or commodities.
volatility factors to value the position. The majority of market The fair values of these structured liabilities are estimated using
inputs are actively quoted and can be validated through external quantitative models for the combined derivative and debt
sources, including brokers, market transactions and third-party portions of the notes. These models incorporate observable
pricing services. When third-party pricing services are used, the and, in some instances, unobservable inputs including security
methods and assumptions are reviewed by the Corporation. prices, interest rate yield curves, option volatility, currency,
Estimation risk is greater for derivative asset and liability commodity or equity rates and correlations among these inputs.
positions that are either option-based or have longer maturity The Corporation also considers the impact of its own credit
dates where observable market inputs are less readily available, spread in determining the discount rate used to value these
or are unobservable, in which case, quantitative-based liabilities. The credit spread is determined by reference to
extrapolations of rate, price or index scenarios are used in observable spreads in the secondary bond market.
determining fair values. The fair values of derivative assets and
liabilities include adjustments for market liquidity, counterparty Securities Financing Agreements
credit quality and other instrument-specific factors, where The fair values of certain reverse repurchase agreements,
appropriate. In addition, the Corporation incorporates within its repurchase agreements and securities borrowed transactions
fair value measurements of OTC derivatives a valuation are determined using quantitative models, including discounted
adjustment to reflect the credit risk associated with the net cash flow models that require the use of multiple market inputs
position. Positions are netted by counterparty, and fair value for including interest rates and spreads to generate continuous
net long exposures is adjusted for counterparty credit risk while yield or pricing curves, and volatility factors. The majority of
the fair value for net short exposures is adjusted for the market inputs are actively quoted and can be validated through
Corporation’s own credit risk. The Corporation also incorporates external sources, including brokers, market transactions and
FVA within its fair value measurements to include funding costs third-party pricing services.
on uncollateralized derivatives and derivatives where the
Corporation is not permitted to use the collateral it receives. An
Deposits
estimate of severity of loss is also used in the determination of The fair values of deposits are determined using quantitative
fair value, primarily based on market data. models, including discounted cash flow models that require the
use of multiple market inputs including interest rates and
Loans and Loan Commitments spreads to generate continuous yield or pricing curves, and
The fair values of loans and loan commitments are based on volatility factors. The majority of market inputs are actively
market prices, where available, or discounted cash flow quoted and can be validated through external sources, including
analyses using market-based credit spreads of comparable debt brokers, market transactions and third-party pricing services.
instruments or credit derivatives of the specific borrower or The Corporation considers the impact of its own credit spread in
comparable borrowers. Results of discounted cash flow the valuation of these liabilities. The credit risk is determined by
analyses may be adjusted, as appropriate, to reflect other reference to observable credit spreads in the secondary cash
market conditions or the perceived credit risk of the borrower. market.
Mortgage Servicing Rights Asset-backed Secured Financings

The fair values of MSRs are primarily determined using an The fair values of asset-backed secured financings are based on
option-adjusted spread valuation approach, which factors in external broker bids, where available, or are determined by
prepayment risk to determine the fair value of MSRs. This discounting estimated cash flows using interest rates
approach consists of projecting servicing cash flows under approximating the Corporation’s current origination rates for
multiple interest rate scenarios and discounting these cash similar loans adjusted to reflect the inherent credit risk.
flows using risk-adjusted discount rates.


02.25.2021 22:56PM 62539
Recurring Fair Value

Assets and liabilities carried at fair value on a recurring basis at December 31, 2020 and 2019, including financial instruments that
the Corporation accounts for under the fair value option, are summarized in the following tables.
December 31, 2020

Netting Assets/Liabilities
(Dollars in millions) Level 1 Level 2 Level 3 Adjustments (1) at Fair Value
Assets
Time deposits placed and other short-term investments $ 1,649 $ — $ — $ — $ 1,649
Federal funds sold and securities borrowed or purchased under
agreements to resell — 108,856 — — 108,856
Trading account assets:
U.S. Treasury and agency securities 45,219 3,051 — — 48,270
Corporate securities, trading loans and other — 22,817 1,359 — 24,176
Equity securities 36,372 31,372 227 — 67,971
Non-U.S. sovereign debt 5,753 20,884 354 — 26,991
Mortgage trading loans, MBS and ABS:
U.S. government-sponsored agency guaranteed (2) — 21,566 75 — 21,641
Mortgage trading loans, ABS and other MBS — 8,440 1,365 — 9,805
Total trading account assets (3) 87,344 108,130 3,380 — 198,854
Derivative assets 15,624 416,175 2,751 (387,371) 47,179
AFS debt securities:
Agency — 61,849 — — 61,849
Agency-collateralized mortgage obligations — 5,260 — — 5,260
Non-agency residential — 631 378 — 1,009
Commercial — 16,491 — — 16,491
Non-U.S. securities — 13,999 18 — 14,017
Other taxable securities — 2,640 71 — 2,711
Tax-exempt securities — 16,598 176 — 16,774
Total AFS debt securities 115,266 118,582 643 — 234,491
Other debt securities carried at fair value:
U.S. Treasury and agency securities 93 — — — 93
Non-agency residential MBS — 506 267 — 773
Non-U.S. and other securities 2,619 8,625 — — 11,244
Total other debt securities carried at fair value 2,712 9,131 267 — 12,110
Loans and leases — 5,964 717 — 6,681
Loans held-for-sale — 1,349 236 — 1,585
Other assets (4) 9,898 3,850 1,970 — 15,718
Total assets (5) $ 232,493 $ 772,037 $ 9,964 $ (387,371) $ 627,123
Liabilities
Interest-bearing deposits in U.S. offices $ — $ 481 $ — $ — $ 481
Federal funds purchased and securities loaned or sold under
agreements to repurchase — 135,391 — — 135,391
Trading account liabilities:
U.S. Treasury and agency securities 9,425 139 — — 9,564
Equity securities 38,189 4,235 — — 42,424
Non-U.S. sovereign debt 5,853 8,043 — — 13,896
Corporate securities and other — 5,420 16 — 5,436
Total trading account liabilities 53,467 17,837 16 — 71,320
Derivative liabilities 14,907 412,881 6,219 (388,481) 45,526
Short-term borrowings — 5,874 — — 5,874
Accrued expenses and other liabilities 12,297 4,014 — — 16,311
Long-term debt — 31,036 1,164 — 32,200
Total liabilities (5) $ 80,671 $ 607,514 $ 7,399 $ (388,481) $ 307,103
(1)
Amounts represent the impact of legally enforceable master netting agreements and also cash collateral held or placed with the same counterparties.
(2)
Includes $22.2 billion of GSE obligations.
(3)
Includes securities with a fair value of $16.8 billion that were segregated in compliance with securities regulations or deposited with clearing organizations. This amount is included in the
parenthetical disclosure on the Consolidated Balance Sheet. Trading account assets also includes precious metal inventories of $576 million that are accounted for at the lower of cost or net
realizable value, which is the current selling price less any costs to sell.
(4)
Includes MSRs of $1.0 billion which are classified as Level 3 assets.
(5)
Total recurring Level 3 assets were 0.35 percent of total consolidated assets, and total recurring Level 3 liabilities were 0.29 percent of total consolidated liabilities.


02.25.2021 22:56PM 62539
December 31, 2019

Netting Assets/Liabilities
(Dollars in millions) Level 1 Level 2 Level 3 Adjustments (1) at Fair Value
Assets
Time deposits placed and other short-term investments $ 1,000 $ — $ — $ — $ 1,000
Federal funds sold and securities borrowed or purchased under
agreements to resell — 50,364 — — 50,364
Corporate securities, trading loans and other — 25,226 1,507 — 26,733
Non-U.S. sovereign debt 3,965 23,854 482 — 28,301
Mortgage trading loans, MBS and ABS:
U.S. government-sponsored agency guaranteed (2) — 24,324 — — 24,324
Mortgage trading loans, ABS and other MBS — 8,786 1,553 — 10,339
Total trading account assets (3) 107,079 118,966 3,781 — 229,826
Derivative assets 14,079 328,442 2,226 (304,262) 40,485
Agency — 122,528 — — 122,528
Agency-collateralized mortgage obligations — 4,641 — — 4,641
Non-agency residential — 653 424 — 1,077
Commercial — 15,021 — — 15,021
Non-U.S. securities — 11,989 2 — 11,991
Other taxable securities — 3,876 65 — 3,941
Tax-exempt securities — 17,804 108 — 17,912
Total AFS debt securities 67,332 177,708 599 — 245,639
Other debt securities carried at fair value:
U.S. Treasury and agency securities 3 — — — 3
Agency MBS — 3,003 — — 3,003
Non-agency residential MBS — 1,035 299 — 1,334
Non-U.S. and other securities 400 6,088 — — 6,488
Total other debt securities carried at fair value 403 10,126 299 — 10,828
Loans and leases — 7,642 693 — 8,335
Loans held-for-sale — 3,334 375 — 3,709
Other assets (4) 11,782 1,376 2,360 — 15,518
Total assets (5) $ 201,675 $ 697,958 $ 10,333 $ (304,262) $ 605,704
Liabilities
Interest-bearing deposits in U.S. offices $ — $ 508 $ — $ — $ 508
Federal funds purchased and securities loaned or sold under
agreements to repurchase — 16,008 — — 16,008
Trading account liabilities:
U.S. Treasury and agency securities 13,140 282 — — 13,422
Non-U.S. sovereign debt 10,751 11,310 — — 22,061
Corporate securities and other — 5,478 15 — 5,493
Total trading account liabilities 62,039 21,214 17 — 83,270
Derivative liabilities 11,904 320,479 4,764 (298,918) 38,229
Short-term borrowings — 3,941 — — 3,941
Accrued expenses and other liabilities 13,927 1,507 — — 15,434
Long-term debt — 33,826 1,149 — 34,975
Total liabilities (5) $ 87,870 $ 397,483 $ 5,930 $ (298,918) $ 192,365
(1)
Amounts represent the impact of legally enforceable master netting agreements and also cash collateral held or placed with the same counterparties.
(2)
Includes $26.7 billion of GSE obligations.
(3)
Includes securities with a fair value of $14.7 billion that were segregated in compliance with securities regulations or deposited with clearing organizations. This amount is included in the
parenthetical disclosure on the Consolidated Balance Sheet.
(4)
Includes MSRs of $1.5 billion which are classified as Level 3 assets.
(5)
Total recurring Level 3 assets were 0.42 percent of total consolidated assets, and total recurring Level 3 liabilities were 0.27 percent of total consolidated liabilities.


02.25.2021 22:56PM 62539
The following tables present a reconciliation of all assets transfers out of Level 3 occur primarily due to increased price
and liabilities measured at fair value on a recurring basis using observability. Transfers occur on a regular basis for long-term
significant unobservable inputs (Level 3) during 2020, 2019 and debt instruments due to changes in the impact of unobservable
2018, including net realized and unrealized gains (losses) inputs on the value of the embedded derivative in relation to the
included in earnings and accumulated OCI. Transfers into Level instrument as a whole.
3 occur primarily due to decreased price observability, and
Level 3 – Fair Value Measurements (1)

Change in
Unrealized
Total Gains
Realized/ (Losses) in
Unrealized Net Income
Gains Gross Gross Related to
(Losses) in Gains Transfers Transfers Financial
Balance Net (Losses) Gross into out of Balance Instruments
(Dollars in millions) January 1 Income (2) in OCI (3) Purchases Sales Issuances Settlements Level 3 Level 3 December 31 Still Held (2)
Year Ended December 31, 2020
Corporate securities, trading loans and other $ 1,507 $ (138) $ (1) $ 430 $(242) $ 10 $ (282) $ 639 $ (564) $ 1,359 $ (102)
Equity securities 239 (43) — 78 (53) — (3) 58 (49) 227 (31)
Non-U.S. sovereign debt 482 45 (46) 76 (61) — (39) 150 (253) 354 47
Mortgage trading loans, ABS and other MBS 1,553 (120) (3) 577 (746) 11 (96) 757 (493) 1,440 (92)
Total trading account assets 3,781 (256) (50) 1,161 (1,102) 21 (420) 1,604 (1,359) 3,380 (178)
Net derivative assets (liabilities) (4) (2,538) (235) — 120 (646) — (112) (235) 178 (3,468) (953)
Non-agency residential MBS 424 (2) 3 23 (54) — (44) 158 (130) 378 (2)
Non-U.S. securities 2 1 — — (1) — (1) 17 — 18 1
Other taxable securities 65 — — 9 (4) — — 1 — 71 —
Tax-exempt securities 108 (21) 3 — — — (169) 265 (10) 176 (20)
Total AFS debt securities 599 (22) 6 32 (59) — (214) 441 (140) 643 (21)
Other debt securities carried at fair value – Non-
agency residential MBS 299 26 — — (180) — (24) 190 (44) 267 3
Loans and leases (5,6) 693 (4) — 145 (76) 22 (161) 98 — 717 9
Loans held-for-sale (5,6) 375 26 (28) — (489) 691 (119) 93 (313) 236 (5)
Other assets (6,7) 2,360 (288) 3 178 (4) 224 (506) 5 (2) 1,970 (374)
Trading account liabilities – Equity securities (2) 1 — — — — — — 1 — —
Trading account liabilities – Corporate securities
and other (15) 8 — (7) (3) — 1 — — (16) —
Long-term debt (5) (1,149) (46) 2 (104) — (47) 218 (52) 14 (1,164) (5)

Corporate securities, trading loans and other $ 1,558 $ 105 $ — $ 534 $(390) $ 18 $ (578) $ 699 $ (439) $ 1,507 $ 29
Non-U.S. sovereign debt 465 46 (12) 1 — — (51) 39 (6) 482 47
Mortgage trading loans, ABS and other MBS 1,635 99 (2) 662 (899) — (175) 738 (505) 1,553 26
Total trading account assets 3,934 238 (14) 1,235 (1,376) 18 (813) 1,555 (996) 3,781 84
Net derivative assets (liabilities) (4,8) (935) (37) — 298 (837) — (97) 147 (1,077) (2,538) 228
Non-agency residential MBS 597 13 64 — (73) — (40) 206 (343) 424 —
Non-U.S. securities 2 — — — — — — — — 2 —
Other taxable securities 7 2 — — — — (5) 61 — 65 —
Tax-exempt securities — — — — — — — 108 — 108 —
Total AFS debt securities 606 15 64 — (73) — (45) 375 (343) 599 —
Other debt securities carried at fair value – Non-
agency residential MBS 172 36 — — — — (17) 155 (47) 299 38
Loans and leases (5,6) 338 — — 230 (35) 217 (57) — — 693 (1)
(5,6)
Loans held-for-sale 542 48 (6) 12 (71) 36 (245) 59 — 375 22
Other assets (6,7) 2,932 (81) 19 — (10) 179 (683) 5 (1) 2,360 (267)
Trading account liabilities – Equity securities — (2) — — — — — — — (2) (2)
and other (18) 8 — (1) (3) (1) — — — (15) —
Long-term debt (5,8) (817) (59) (64) — — (40) 180 (350) 1 (1,149) (55)
(1)
Assets (liabilities). For assets, increase (decrease) to Level 3 and for liabilities, (increase) decrease to Level 3.
(2)
Includes gains (losses) reported in earnings in the following income statement line items: Trading account assets/liabilities - predominantly market making and similar activities; Net derivative
assets (liabilities) - market making and similar activities and other income; AFS debt securities - predominantly other income; Other debt securities carried at fair value - other income; Loans and
leases - market making and similar activities and other income; Loans held-for-sale - other income; Other assets - primarily other income related to MSRs; Long-term debt - market making and
similar activities.
(3)
Includes unrealized gains (losses) in OCI on AFS debt securities, foreign currency translation adjustments and the impact of changes in the Corporation’s credit spreads on long-term debt
accounted for under the fair value option. Amounts include net unrealized gains (losses) of $(41) million and $3 million related to financial instruments still held at December 31, 2020
and 2019.
(4)
Net derivative assets (liabilities) include derivative assets of $2.8 billion and $2.2 billion and derivative liabilities of $6.2 billion and $4.8 billion at December 31, 2020 and 2019.
(5)
Amounts represent instruments that are accounted for under the fair value option.
(6)
Issuances represent loan originations and MSRs recognized following securitizations or whole-loan sales.
(7)
Settlements primarily represent the net change in fair value of the MSR asset due to the recognition of modeled cash flows and the passage of time.
(8)
Transfers into long-term debt include a $1.4 billion transfer in of Level 3 derivative assets to reflect the Corporation's change to present bifurcated embedded derivatives with their respective host
instruments.


02.25.2021 22:56PM 62539
Level 3 – Fair Value Measurements (1)
Change in
Unrealized
Total Gains
Realized/ (Losses) in
Unrealized Net Income
Gains Gross Gross Related to
(Losses) in Gains Transfers Transfers Financial
Balance Net (Losses) Gross into out of Balance Instruments
(Dollars in millions) January 1 Income (2) in OCI (3) Purchases Sales Issuances Settlements Level 3 Level 3 December 31 Still Held (2)
Corporate securities, trading loans and other $ 1,864 $ (32) $ (1) $ 436 $ (403) $ 5 $ (568) $ 804 $ (547) $ 1,558 $ (117)
Non-U.S. sovereign debt 556 47 (44) 13 (57) — (30) 117 (137) 465 48
Mortgage trading loans, ABS and other MBS 1,498 148 3 585 (910) — (158) 705 (236) 1,635 97
Total trading account assets 4,153 146 (42) 1,078 (1,381) 5 (760) 1,704 (969) 3,934 6
Net derivative assets (liabilities) (4) (1,714) 106 — 531 (1,179) — 778 39 504 (935) (116)
Non-agency residential MBS — 27 (33) — (71) — (25) 774 (75) 597 —
Non-U.S. securities 25 — (1) — (10) — (15) 3 — 2 —
Other taxable securities 509 1 (3) — (23) — (11) 60 (526) 7 —
Tax-exempt securities 469 — — — — — (1) 1 (469) — —
Total AFS debt securities (5) 1,003 28 (37) — (104) — (52) 838 (1,070) 606 —
Other debt securities carried at fair value - Non-
agency residential MBS — (18) — — (8) — (34) 365 (133) 172 (18)
Loans and leases (6,7) 571 (16) — — (134) — (83) — — 338 (9)
(6)
Loans held-for-sale 690 44 (26) 71 — 1 (201) 23 (60) 542 31
Other assets (5,7,8) 2,425 414 (38) 2 (69) 96 (792) 929 (35) 2,932 149
and other (24) 11 — 9 (12) (2) — — — (18) (7)
Accrued expenses and other liabilities (6) (8) — — — — — 8 — — — —
Long-term debt (6) (1,863) 103 4 9 — (141) 486 (262) 847 (817) 95
(1)
Assets (liabilities). For assets, increase (decrease) to Level 3 and for liabilities, (increase) decrease to Level 3.
(2)
Includes gains/losses reported in earnings in the following income statement line items: Trading account assets/liabilities - predominantly market making and similar activities; Net derivative
assets (liabilities) - market making and similar activities and other income; Other debt securities carried at fair value - other income; Loans and leases - predominantly other income; Loans held-
for-sale - other income; Other assets - primarily other income related to MSRs; Long-term debt - primarily market making and similar activities.
(3)
Includes unrealized gains (losses) in OCI on AFS debt securities, foreign currency translation adjustments and the impact of changes in the Corporation’s credit spreads on long-term debt
accounted for under the fair value option. Amounts include net unrealized losses of $105 million related to financial instruments still held at December 31, 2018.
(4)
Net derivative assets (liabilities) include derivative assets of $3.5 billion and derivative liabilities of $4.4 billion.
(5)
Transfers out of AFS debt securities and into other assets primarily relate to the reclassifcation of certain securities.
(6)
Amounts represent instruments that are accounted for under the fair value option.
(7)
Issuances represent loan originations and MSRs recognized following securitizations or whole-loan sales.
(8)
Settlements primarily represent the net change in fair value of the MSR asset due to the recognition of modeled cash flows and the passage of time.


02.25.2021 22:56PM 62539
The following tables present information about significant unobservable inputs related to the Corporation’s material categories of
Level 3 financial assets and liabilities at December 31, 2020 and 2019.
Quantitative Information about Level 3 Fair Value Measurements at December 31, 2020
(Dollars in millions) Inputs
Fair Valuation Significant Unobservable Ranges of Weighted

Financial Instrument Value Technique Inputs Inputs Average (1)
Loans and Securities (2)
Instruments backed by residential real estate assets $ 1,543 Yield (3)% to 25% 6%
Trading account assets – Mortgage trading loans, ABS and other MBS 467 Discounted cash Prepayment speed 1% to 56% CPR 20% CPR
Loans and leases 431 flow, Market Default rate 0% to 3% CDR 1% CDR
AFS debt securities – Non-agency residential 378 comparables Price $0 to $168 $110
Other debt securities carried at fair value – Non-agency residential 267 Loss severity 0% to 47% 18%
Instruments backed by commercial real estate assets $ 407 Yield 0% to 25% 4%
Trading account assets – Corporate securities, trading loans and other 262 Price $0 to $100 $52
Discounted cash
Trading account assets – Mortgage trading loans, ABS and other MBS 43
flow
AFS debt securities, primarily other taxable securities 89
Loans held-for-sale 13
Commercial loans, debt securities and other $ 3,066 Yield 0% to 26% 9%
Trading account assets – Corporate securities, trading loans and other 1,097 Prepayment speed 10% to 20% 14%
Trading account assets – Non-U.S. sovereign debt 354 Discounted cash Default rate 3% to 4% 4%
Trading account assets – Mortgage trading loans, ABS and other MBS 930 flow, Market Loss severity 35% to 40% 38%
AFS debt securities – Tax-exempt securities 176 comparables Price $0 to $142 $66
Loans and leases 286 Long-dated equity volatilities 77% n/a
Other assets, primarily auction rate securities $ 937 Discounted cash Price $10 to $97 $91
flow, Market Discount rate 8% n/a
comparables
(5)
MSRs $ 1,033 Weighted-average life, fixed rate 0 to 13 years 4 years
Discounted cash Weighted-average life, variable rate (5) 0 to 10 years 3 years
flow Option-adjusted spread, fixed rate 7% to 14% 9%
Option-adjusted spread, variable rate 9% to 15% 12%
Structured liabilities
Long-term debt $ (1,164) Yield 0% to 11% 9%
Discounted cash
flow, Market Equity correlation 2% to 100% 64%
comparables, Long-dated equity volatilities 7% to 64% 32%
Industry standard Price $0 to $124 $86
derivative pricing (3)
Natural gas forward price $1/MMBtu to $4/MMBtu $3 /MMBtu
Net derivative assets (liabilities)
Credit derivatives $ (112) Yield 5% n/a
Upfront points 0 to 100 points 75 points
Discounted cash
flow, Stochastic Prepayment speed 15% to 100% CPR 22% CPR
recovery correlation Default rate 2% CDR n/a
model
Credit correlation 21% to 64% 57%
Price $0 to $122 $69
Equity derivatives $ (1,904) Industry standard Equity correlation 2% to 100% 64%
derivative pricing (3) Long-dated equity volatilities 7% to 64% 32%
Commodity derivatives $ (1,426) Discounted cash Natural gas forward price $1/MMBtu to $4/MMBtu $3 /MMBtu
flow, Industry
Correlation 39% to 85% 73%
standard derivative
pricing (3) Volatilities 23% to 70% 39%
Interest rate derivatives $ (26) Correlation (IR/IR) 15% to 96% 34%
Correlation (FX/IR) 0% to 46% 3%
Industry standard
Long-dated inflation rates (7)% to 84% 14%
Long-dated inflation volatilities 0% to 1% 1%
Interest rate volatilities 0% to 2% 1%
Total net derivative assets (liabilities) $ (3,468)
(1)
For loans and securities, structured liabilities and net derivative assets (liabilities), the weighted average is calculated based upon the absolute fair value of the instruments.
(2)
The categories are aggregated based upon product type which differs from financial statement classification. The following is a reconciliation to the line items in the table on page 179: Trading
account assets – Corporate securities, trading loans and other of $1.4 billion, Trading account assets – Non-U.S. sovereign debt of $354 million, Trading account assets – Mortgage trading loans,
ABS and other MBS of $1.4 billion, AFS debt securities of $643 million, Other debt securities carried at fair value - Non-agency residential of $267 million, Other assets, including MSRs, of $2.0
billion, Loans and leases of $717 million and LHFS of $236 million.
(3)
Includes models such as Monte Carlo simulation and Black-Scholes.
(4)
Includes models such as Monte Carlo simulation, Black-Scholes and other methods that model the joint dynamics of interest, inflation and foreign exchange rates.
(5)
The weighted-average life is a product of changes in market rates of interest, prepayment rates and other model and cash flow assumptions.
CPR = Constant Prepayment Rate
CDR = Constant Default Rate
MMBtu = Million British thermal units

IR = Interest Rate
FX = Foreign Exchange


02.25.2021 22:56PM 62539
Quantitative Information about Level 3 Fair Value Measurements at December 31, 2019
(Dollars in millions) Inputs
Fair Valuation Significant Unobservable Ranges of Weighted

Loans and Securities (2)
Instruments backed by residential real estate assets $ 1,407 Yield 0% to 25% 6%
Trading account assets – Mortgage trading loans, ABS and other MBS 332 Prepayment speed 1% to 27% CPR 17% CPR
Loans and leases 281 Discounted cash Default rate 0% to 3% CDR 1% CDR
flow, Market
Loans held-for-sale 4 comparables Loss severity 0% to 47% 14%
AFS debt securities, primarily non-agency residential 491 Price $0 to $160 $94
Other debt securities carried at fair value - Non-agency residential 299
Instruments backed by commercial real estate assets $ 303 Yield 0% to 30% 14%
Trading account assets – Corporate securities, trading loans and other 201 Price $0 to $100 $55
Discounted cash flow
Trading account assets – Mortgage trading loans, ABS and other MBS 85
Commercial loans, debt securities and other $ 3,798 Yield 1% to 20% 6%
Trading account assets – Corporate securities, trading loans and other 1,306 Prepayment speed 10% to 20% 13%
Trading account assets – Non-U.S. sovereign debt 482 Discounted cash Default rate 3% to 4% 4%
Trading account assets – Mortgage trading loans, ABS and other MBS 1,136 flow, Market Loss severity 35% to 40% 38%
AFS debt securities – Tax-exempt securities 108 comparables Price $0 to $142 $72
Loans and leases 412 Long-dated equity volatilities 35% n/a
Other assets, primarily auction rate securities $ 815 Discounted cash Price $10 to $100 $96
flow, Market
comparables
MSRs $ 1,545 Weighted-average life, fixed rate (5) 0 to 14 years 5 years

Weighted-average life, variable rate (5) 0 to 9 years 3 years
Discounted cash flow
Option-adjusted spread, fixed rate 7% to 14% 9%
Option-adjusted spread, variable rate 9% to 15% 11%
Structured liabilities
Long-term debt $ (1,149) Yield 2% to 6% 5%
Discounted cash
flow, Market Equity correlation 9% to 100% 63%
comparables, Long-dated equity volatilities 4% to 101% 32%
Industry standard Price $0 to $116 $74
Natural gas forward price $1/MMBtu to $5/MMBtu $3/MMBtu
Net derivative assets (liabilities)
Credit derivatives $ 13 Yield 5% n/a
Upfront points 0 to 100 points 63 points
Discounted cash
flow, Stochastic Prepayment speed 15% to 100% CPR 22% CPR
recovery correlation Default rate 1% to 4% CDR 2% CDR
model
Loss severity 35% n/a
Price $0 to $104 $73
Equity derivatives $ (1,081) Industry standard Equity correlation 9% to 100% 63%
derivative pricing (3) Long-dated equity volatilities 4% to 101% 32%
Commodity derivatives $ (1,357) Discounted cash Natural gas forward price $1/MMBtu to $5/MMBtu $3/MMBtu
flow, Industry
Correlation 30% to 69% 68%
standard derivative
pricing (3) Volatilities 14% to 54% 27%
Interest rate derivatives $ (113) Correlation (IR/IR) 15% to 94% 52%
Industry standard Correlation (FX/IR) 0% to 46% 2%
derivative pricing (4) Long-dated inflation rates G(23)% to 56% 16%
Long-dated inflation volatilities 0% to 1% 1%
Total net derivative assets (liabilities) $ (2,538)
(1)
For loans and securities, structured liabilities and net derivative assets (liabilities), the weighted average is calculated based upon the absolute fair value of the instruments.
(2)
The categories are aggregated based upon product type which differs from financial statement classification. The following is a reconciliation to the line items in the table on page 180: Trading
account assets – Corporate securities, trading loans and other of $1.5 billion, Trading account assets – Non-U.S. sovereign debt of $482 million, Trading account assets – Mortgage trading loans,
ABS and other MBS of $1.6 billion, AFS debt securities of $599 million, Other debt securities carried at fair value - Non-agency residential of $299 million, Other assets, including MSRs, of $2.4
billion, Loans and leases of $693 million and LHFS of $375 million.
(3)
Includes models such as Monte Carlo simulation and Black-Scholes.
(4)
Includes models such as Monte Carlo simulation, Black-Scholes and other methods that model the joint dynamics of interest, inflation and foreign exchange rates.
(5)
The weighted-average life is a product of changes in market rates of interest, prepayment rates and other model and cash flow assumptions.
CPR = Constant Prepayment Rate
CDR = Constant Default Rate
MMBtu = Million British thermal units
IR = Interest Rate
FX = Foreign Exchange


02.25.2021 22:56PM 62539
In the previous tables, instruments backed by residential protection buyer at inception), credit spreads, default rates or
and commercial real estate assets include RMBS, commercial loss severities would have resulted in a significantly lower fair
MBS, whole loans and mortgage CDOs. Commercial loans, debt value for protection sellers and higher fair value for protection
securities and other include corporate CLOs and CDOs, buyers. The impact of changes in prepayment speeds would
commercial loans and bonds, and securities backed by non-real have resulted in differing impacts depending on the seniority of
estate assets. Structured liabilities primarily include equity- the instrument.
linked notes that are accounted for under the fair value option. Structured credit derivatives are impacted by credit
The Corporation uses multiple market approaches in valuing correlation. Default correlation is a parameter that describes the
certain of its Level 3 financial instruments. For example, market degree of dependence among credit default rates within a credit
comparables and discounted cash flows are used together. For portfolio that underlies a credit derivative instrument. The
a given product, such as corporate debt securities, market sensitivity of this input on the fair value varies depending on the
comparables may be used to estimate some of the level of subordination of the tranche. For senior tranches that
unobservable inputs and then these inputs are incorporated into are net purchases of protection, a significant increase in default
a discounted cash flow model. Therefore, the balances correlation would have resulted in a significantly higher fair
disclosed encompass both of these techniques. value. Net short protection positions would have been impacted
The level of aggregation and diversity within the products in a directionally opposite way.
disclosed in the tables result in certain ranges of inputs being For equity derivatives, commodity derivatives, interest rate
wide and unevenly distributed across asset and liability derivatives and structured liabilities, a significant change in
categories. long-dated rates and volatilities and correlation inputs (i.e., the
degree of correlation between an equity security and an index,
Uncertainty of Fair Value Measurements from between two different commodities, between two different
Unobservable Inputs interest rates, or between interest rates and foreign exchange
rates) would have resulted in a significant impact to the fair
Loans and Securities value; however, the magnitude and direction of the impact
A significant increase in market yields, default rates, loss depend on whether the Corporation is long or short the
severities or duration would have resulted in a significantly lower exposure. For structured liabilities, a significant increase in yield
fair value for long positions. Short positions would have been or decrease in price would have resulted in a significantly lower
impacted in a directionally opposite way. The impact of changes fair value.
in prepayment speeds would have resulted in differing impacts
depending on the seniority of the instrument and, in the case of Nonrecurring Fair Value
CLOs, whether prepayments can be reinvested. A significant The Corporation holds certain assets that are measured at fair
increase in price would have resulted in a significantly higher value only in certain situations (e.g., the impairment of an
fair value for long positions, and short positions would have asset), and these measurements are referred to herein as
been impacted in a directionally opposite way. nonrecurring. The amounts below represent assets still held as
of the reporting date for which a nonrecurring fair value
Structured Liabilities and Derivatives adjustment was recorded during 2020, 2019 and 2018.
For credit derivatives, a significant increase in market yield,
upfront points (i.e., a single upfront payment made by a
Assets Measured at Fair Value on a Nonrecurring Basis

(Dollars in millions) Level 2 Level 3 Level 2 Level 3
Assets
Loans held-for-sale $ 1,020 $ 792 $ 53 $ 102
Loans and leases (1) — 301 — 257
Foreclosed properties (2, 3) — 17 — 17
Other assets 323 576 178 646
Gains (Losses)
2020 2019 2018
Assets
Loans held-for-sale $ (79) $ (14) $ (18)
Loans and leases (1) (73) (81) (202)
Foreclosed properties (6) (9) (24)
Other assets (98) (2,145) (64)
(1)
Includes $30 million, $36 million and $83 million of losses on loans that were written down to a collateral value of zero during 2020, 2019 and 2018, respectively.
(2)
Amounts are included in other assets on the Consolidated Balance Sheet and represent the carrying value of foreclosed properties that were written down subsequent to their initial classification
as foreclosed properties. Losses on foreclosed properties include losses recorded during the first 90 days after transfer of a loan to foreclosed properties.
(3)
Excludes $119 million and $260 million of properties acquired upon foreclosure of certain government-guaranteed loans (principally FHA-insured loans) at December 31, 2020 and 2019.


02.25.2021 22:56PM 62539
The table below presents information about significant unobservable inputs utilized in the Corporation's nonrecurring Level 3 fair
value measurements during 2020 and 2019.
Quantitative Information about Nonrecurring Level 3 Fair Value Measurements

Inputs
Significant
Fair Valuation Unobservable Ranges of Weighted
Loans held-for-sale $ 792 Discounted cash flow Price $8 to $99 $95
Loans and leases (2) 301 Market comparables OREO discount 13% to 59% 24%
Costs to sell 8% to 26% 9%
Other assets (3) 576 Discounted cash flow Revenue attrition 2% to 19% 7%
Discount rate 11% to 14% 12%
2019
Loans held-for-sale $ 102 Discounted cash flow Price $85 to $97 $88
Loans and leases (2) 257 Market comparables OREO discount 13% to 59% 24%
Costs to sell 8% to 26% 9%
Other assets (4) 640 Discounted cash flow Customer attrition 0% to 19% 5%
Cost to service 11% to 19% 15%
(1)
The weighted average is calculated based upon the fair value of the loans.
(2)
Represents residential mortgages where the loan has been written down to the fair value of the underlying collateral.
(3)
The fair value of the intangible asset related to the merchant contracts received from the merchant services joint venture was measured using a discounted cash flow method for which the two
key assumptions were the revenue attrition rate and the discount rate. For more information, see Note 7 – Goodwill and Intangible Assets.
(4)
Reflects the measurement of the Corporation’s merchant services equity method investment on which the Corporation recorded an impairment charge in 2019. The fair value of the merchant
services joint venture was measured using a discounted cash flow method for which the two key assumptions were the customer attrition rate and the cost-to-service rate.
NOTE 21 Fair Value Option offset by changes in the fair value of the derivatives. The fair
value option allows the Corporation to reduce the accounting
Loans and Loan Commitments volatility that would otherwise result from the asymmetry created
The Corporation elects to account for certain loans and loan by accounting for the financial instruments at the lower of cost
commitments that exceed the Corporation’s single-name credit or fair value and the derivatives at fair value. The Corporation
risk concentration guidelines under the fair value option. has not elected to account for certain other LHFS under the fair
Lending commitments are actively managed and, as value option primarily because these loans are floating-rate
appropriate, credit risk for these lending relationships may be loans that are not hedged using derivative instruments.
mitigated through the use of credit derivatives, with the
Corporation’s public side credit view and market perspectives
Loans Reported as Trading Account Assets
determining the size and timing of the hedging activity. These The Corporation elects to account for certain loans that are held
credit derivatives do not meet the requirements for designation for the purpose of trading and are risk-managed on a fair value
as accounting hedges and therefore are carried at fair value. basis under the fair value option.
The fair value option allows the Corporation to carry these loans
Other Assets
and loan commitments at fair value, which is more consistent
The Corporation elects to account for certain long-term fixed-rate
with management’s view of the underlying economics and the
margin loans that are hedged with derivatives under the fair
manner in which they are managed. In addition, the fair value
value option. Election of the fair value option allows the
option allows the Corporation to reduce the accounting volatility
Corporation to reduce the accounting volatility that would
that would otherwise result from the asymmetry created by
otherwise result from the asymmetry created by accounting for
accounting for the financial instruments at historical cost and
the financial instruments at historical cost and the derivatives at
the credit derivatives at fair value.
fair value.
Loans Held-for-sale
Securities Financing Agreements
The Corporation elects to account for residential mortgage
The Corporation elects to account for certain securities
LHFS, commercial mortgage LHFS and certain other LHFS under
financing agreements, including resale and repurchase
the fair value option. These loans are actively managed and
agreements, under the fair value option. These elections include
monitored and, as appropriate, certain market risks of the loans
certain agreements collateralized by the U.S. government and
may be mitigated through the use of derivatives. The
its agencies, which are generally short-dated and have minimal
Corporation has elected not to designate the derivatives as
interest rate risk.
qualifying accounting hedges, and therefore, they are carried at
fair value. The changes in fair value of the loans are largely 186 62539 financials


02.25.2021 22:57PM 62539
Long-term Deposits that would otherwise result from the asymmetry created by
The Corporation elects to account for certain long-term fixed-rate accounting for the asset-backed secured financings at historical
and rate-linked deposits that are hedged with derivatives that do cost and the corresponding mortgage LHFS securing these
not qualify for hedge accounting. Election of the fair value option financings at fair value.
allows the Corporation to reduce the accounting volatility that
would otherwise result from the asymmetry created by
Long-term Debt
accounting for the financial instruments at historical cost and The Corporation elects to account for certain long-term debt,
the derivatives at fair value. The Corporation has not elected to primarily structured liabilities, under the fair value option. This
carry other long-term deposits at fair value because they are not long-term debt is either risk-managed on a fair value basis or
hedged using derivatives. the related hedges do not qualify for hedge accounting.
Short-term Borrowings Fair Value Option Elections

The Corporation elects to account for certain short-term The following tables provide information about the fair value
borrowings, primarily short-term structured liabilities, under the carrying amount and the contractual principal outstanding of
fair value option because this debt is risk-managed on a fair assets and liabilities accounted for under the fair value option
value basis. at December 31, 2020 and 2019, and information about where
The Corporation elects to account for certain asset-backed changes in the fair value of assets and liabilities accounted for
secured financings, which are also classified in short-term under the fair value option are included in the Consolidated
borrowings, under the fair value option. Election of the fair value Statement of Income for 2020, 2019 and 2018.
option allows the Corporation to reduce the accounting volatility
Fair Value Option Elections

Fair Value Fair Value
Fair Value Contractual Carrying Amount Fair Value Contractual Carrying
Carrying Principal Less Unpaid Carrying Principal Amount Less
(Dollars in millions) Amount Outstanding Principal Amount Outstanding Unpaid Principal
Federal funds sold and securities borrowed or
purchased under agreements to resell $ 108,856 $ 108,811 $ 45 $ 50,364 $ 50,318 $ 46
Loans reported as trading account assets (1) 7,967 17,372 (9,405) 6,989 14,703 (7,714)
Trading inventory – other 22,790 n/a n/a 19,574 n/a n/a
Consumer and commercial loans 6,681 6,778 (97) 8,335 8,372 (37)
Loans held-for-sale (1) 1,585 2,521 (936) 3,709 4,879 (1,170)
Other assets 200 n/a n/a 4 n/a n/a
Long-term deposits 481 448 33 508 496 12
Federal funds purchased and securities loaned or
sold under agreements to repurchase 135,391 135,390 1 16,008 16,029 (21)
Short-term borrowings 5,874 5,178 696 3,941 3,930 11
Unfunded loan commitments 99 n/a n/a 90 n/a n/a
Long-term debt 32,200 33,470 (1,270) 34,975 35,730 (755)
(1)
A significant portion of the loans reported as trading account assets and LHFS are distressed loans that were purchased at a deep discount to par, and the remainder are loans with a fair value
near contractual principal outstanding.


02.25.2021 22:57PM 62539
Gains (Losses) Relating to Assets and Liabilities Accounted for Under the Fair Value Option
Market making
and similar Other
activities Income Total
Loans reported as trading account assets $ 107 $ — $ 107
Trading inventory – other (1) 3,216 — 3,216
Consumer and commercial loans 22 (3) 19
Loans held-for-sale (2) — 103 103
Short-term borrowings (170) — (170)
Unfunded loan commitments — (65) (65)
Long-term debt (3) (2,175) (53) (2,228)
Other (4) 35 (22) 13
Total $ 1,035 $ (40) $ 995
2019
Consumer and commercial loans 92 12 104
Loans held-for-sale (2) — 98 98
Short-term borrowings (24) — (24)
Unfunded loan commitments — 79 79
Long-term debt (3) (1,098) (78) (1,176)
Other (4) 9 (27) (18)
Total $ 4,977 $ 84 $ 5,061
2018
Consumer and commercial loans (422) (53) (475)
Loans held-for-sale (2) 1 24 25
Short-term borrowings 2 — 2
Unfunded loan commitments — (49) (49)
Long-term debt (3) 2,157 (93) 2,064
Other (4) 6 18 24
Total $ 3,502 $ (153) $ 3,349
(1)
The gains in market making and similar activities are primarily offset by losses on trading liabilities that hedge these assets.
(2)
Includes the value of IRLCs on funded loans, including those sold during the period.
(3)
The net gains (losses) in market making and similar activities relate to the embedded derivatives in structured liabilities and are typically offset by (losses) gains on derivatives and securities that
hedge these liabilities. For the cumulative impact of changes in the Corporation’s own credit spreads and the amount recognized in accumulated OCI, see Note 14 – Accumulated Other
Comprehensive Income (Loss). For more information on how the Corporation’s own credit spread is determined, see Note 20 – Fair Value Measurements.
(4)
Includes gains (losses) on federal funds sold and securities borrowed or purchased under agreements to resell, long-term deposits and federal funds purchased and securities loaned or sold
under agreements to repurchase.
Gains (Losses) Related to Borrower-specific Credit Risk for Assets and Liabilities Accounted for Under the Fair Value
Option
Loans reported as trading account assets $ (172) $ 43 $ 6
Consumer and commercial loans (19) 15 (56)
Loans held-for-sale (105) 57 (4)
Unfunded loan commitments (65) 79 (94)
NOTE 22 Fair Value of Financial Instruments certain resale and repurchase agreements and short-term
Financial instruments are classified within the fair value borrowings, approximates the fair value of these instruments.
hierarchy using the methodologies described in Note 20 – Fair These financial instruments generally expose the Corporation to
Value Measurements. Certain loans, deposits, long-term debt, limited credit risk and have no stated maturities or have short-
unfunded lending commitments and other financial instruments term maturities and carry interest rates that approximate
are accounted for under the fair value option. For more market. The Corporation accounts for certain resale and
information, see Note 21 – Fair Value Option. The following repurchase agreements under the fair value option.
disclosures include financial instruments that are not carried at Under the fair value hierarchy, cash and cash equivalents
fair value or only a portion of the ending balance is carried at are classified as Level 1. Time deposits placed and other short-
fair value on the Consolidated Balance Sheet. term investments, such as U.S. government securities and
short-term commercial paper, are classified as Level 1 or Level
Short-term Financial Instruments 2. Federal funds sold and purchased are classified as Level 2.
The carrying value of short-term financial instruments, including Resale and repurchase agreements are classified as Level 2
cash and cash equivalents, certain time deposits placed and because they are generally short-dated and/or variable-rate
other short-term investments, federal funds sold and purchased, instruments collateralized by U.S. government or agency
securities. Short-term borrowings are classified as Level 2.

02.25.2021 22:57PM 62539
Fair Value of Financial Instruments Global Banking

The carrying values and fair values by fair value hierarchy of Global Banking provides a wide range of lending-related products
certain financial instruments where only a portion of the ending and services, integrated working capital management and
balance was carried at fair value at December 31, 2020 and treasury solutions, and underwriting and advisory services
2019 are presented in the following table. through the Corporation’s network of offices and client
relationship teams. Global Banking also provides investment
banking products to clients. The economics of certain
Fair Value of Financial Instruments investment banking and underwriting activities are shared
primarily between Global Banking and Global Markets under an
Fair Value
internal revenue-sharing arrangement. Global Banking clients
Carrying
Value Level 2 Level 3 Total generally include middle-market companies, commercial real
(Dollars in millions) December 31, 2020 estate firms, not-for-profit companies, large global corporations,
Financial assets financial institutions, leasing clients, and mid-sized U.S.-based
Loans $ 887,289 $ 49,372 $ 877,682 $ 927,054 businesses requiring customized and integrated financial advice
Loans held-for-sale 9,243 7,864 1,379 9,243 and solutions.
Financial liabilities
Deposits (1) 1,795,480 1,795,545 — 1,795,545 Global Markets
Long-term debt 262,934 271,315 1,164 272,479 Global Markets offers sales and trading services and research
Commercial services to institutional clients across fixed-income, credit,
unfunded lending
commitments (2) 1,977 99 5,159 5,258
currency, commodity and equity businesses. Global Markets
provides market-making, financing, securities clearing,
December 31, 2019 settlement and custody services globally to institutional investor
Financial assets clients in support of their investing and trading activities. Global
Loans $ 950,093 $ 63,633 $ 914,597 $ 978,230 Markets product coverage includes securities and derivative
Loans held-for-sale 9,158 8,439 719 9,158 products in both the primary and secondary markets. Global
Financial liabilities Markets also works with commercial and corporate clients to
Deposits (1) 1,434,803 1,434,809 — 1,434,809
provide risk management products. As a result of market-
Long-term debt 240,856 247,376 1,149 248,525
making activities, Global Markets may be required to manage
Commercial
unfunded lending risk in a broad range of financial products. In addition, the
commitments (2) 903 90 4,777 4,867 economics of certain investment banking and underwriting
(1)
Includes demand deposits of $799.0 billion and $545.5 billion with no stated maturities at activities are shared primarily between Global Markets and
(2)
December 31, 2020 and 2019. Global Banking under an internal revenue-sharing arrangement.
The carrying value of commercial unfunded lending commitments is included in accrued
expenses and other liabilities on the Consolidated Balance Sheet. The Corporation does not
estimate the fair value of consumer unfunded lending commitments because, in many All Other
instances, the Corporation can reduce or cancel these commitments by providing notice to All Other consists of ALM activities, equity investments, non-
the borrower. For more information on commitments, see Note 12 – Commitments and
Contingencies. core mortgage loans and servicing activities, liquidating
businesses and certain expenses not otherwise allocated to
NOTE 23 Business Segment Information business segments. ALM activities encompass certain
The Corporation reports its results of operations through the residential mortgages, debt securities, interest rate and foreign
following four business segments: Consumer Banking, GWIM, currency risk management activities. Substantially all of the
Global Banking and Global Markets, with the remaining results of ALM activities are allocated to the business
operations recorded in All Other. segments.
Consumer Banking Basis of Presentation
Consumer Banking offers a diversified range of credit, banking The management accounting and reporting process derives
and investment products and services to consumers and small segment and business results by utilizing allocation
businesses. Consumer Banking product offerings include methodologies for revenue and expense. The net income
traditional savings accounts, money market savings accounts, derived for the businesses is dependent upon revenue and cost
CDs and IRAs, checking accounts, and investment accounts and allocations using an activity-based costing model, funds transfer
products, as well as credit and debit cards, residential pricing, and other methodologies and assumptions management
mortgages and home equity loans, and direct and indirect loans believes are appropriate to reflect the results of the business.
to consumers and small businesses in the U.S. Consumer Total revenue, net of interest expense, includes net interest
Banking includes the impact of servicing residential mortgages income on an FTE basis and noninterest income. The
and home equity loans in the core portfolio. adjustment of net interest income to an FTE basis results in a
corresponding increase in income tax expense. The segment
Global Wealth & Investment Management results also reflect certain revenue and expense methodologies
GWIM provides a high-touch client experience through a network that are utilized to determine net income. The net interest
of financial advisors focused on clients with over $250,000 in income of the businesses includes the results of a funds
total investable assets, including tailored solutions to meet transfer pricing process that matches assets and liabilities with
clients’ needs through a full set of investment management, similar interest rate sensitivity and maturity characteristics. In
brokerage, banking and retirement products. GWIM also segments where the total of liabilities and equity exceeds
provides comprehensive wealth management solutions targeted assets, which are generally deposit-taking segments, the
to high net worth and ultra high net worth clients, as well as Corporation allocates assets to match liabilities. Net interest
customized solutions to meet clients’ wealth structuring, income of the business segments also includes an allocation of
investment management, trust and banking needs, including
specialty asset management services.

02.25.2021 22:57PM 62539
net interest income generated by certain of the Corporation’s strategies, the effects of the Corporation’s internal funds
ALM activities. transfer pricing process and the net effects of other ALM
The Corporation’s ALM activities include an overall interest activities.
rate risk management strategy that incorporates the use of Certain expenses not directly attributable to a specific
various derivatives and cash instruments to manage business segment are allocated to the segments. The costs of
fluctuations in earnings and capital that are caused by interest certain centralized or shared functions are allocated based on
rate volatility. The Corporation’s goal is to manage interest rate methodologies that reflect utilization.
sensitivity so that movements in interest rates do not The following table presents net income (loss) and the
significantly adversely affect earnings and capital. The results of components thereto (with net interest income on an FTE basis
substantially all of the Corporation’s ALM activities are allocated for the business segments, All Other and the total Corporation)
to the business segments and fluctuate based on the for 2020, 2019 and 2018, and total assets at December 31,
performance of the ALM activities. ALM activities include 2020 and 2019 for each business segment, as well as All
external product pricing decisions including deposit pricing Other.
Results of Business Segments and All Other

At and for the year ended December 31 Total Corporation (1) Consumer Banking
Net interest income $ 43,859 $ 49,486 $ 48,772 $ 24,698 $ 28,158 $ 27,025
Noninterest income 42,168 42,353 42,858 8,564 10,429 10,593
Total revenue, net of interest expense 86,027 91,839 91,630 33,262 38,587 37,618
Provision for credit losses 11,320 3,590 3,282 5,765 3,772 3,664
Noninterest expense 55,213 54,900 53,154 18,878 17,646 17,672
Income before income taxes 19,494 33,349 35,194 8,619 17,169 16,282
Income tax expense 1,600 5,919 7,047 2,112 4,207 4,150
Net income $ 17,894 $ 27,430 $ 28,147 $ 6,507 $ 12,962 $ 12,132
Period-end total assets $ 2,819,627 $ 2,434,079 $ 988,580 $ 804,093
Global Wealth & Investment Management Global Banking

2020 2019 2018 2020 2019 2018
Net interest income $ 5,468 $ 6,504 $ 6,265 $ 9,013 $ 10,675 $ 10,993
Noninterest income 13,116 13,034 13,188 9,974 9,808 9,008
Total revenue, net of interest expense 18,584 19,538 19,453 18,987 20,483 20,001
Provision for credit losses 357 82 86 4,897 414 8
Income before income taxes 4,073 5,631 5,352 4,753 11,058 11,248
Income tax expense 998 1,380 1,364 1,283 2,985 2,923
Net income $ 3,075 $ 4,251 $ 3,988 $ 3,470 $ 8,073 $ 8,325
Period-end total assets $ 369,736 $ 299,770 $ 580,561 $ 464,032
Global Markets All Other

2020 2019 2018 2020 2019 2018
Net interest income $ 4,646 $ 3,915 $ 3,857 $ 34 $ 234 $ 632
Noninterest income 14,120 11,699 12,326 (3,606) (2,617) (2,257)
Total revenue, net of interest expense 18,766 15,614 16,183 (3,572) (2,383) (1,625)
Provision for credit losses 251 (9) — 50 (669) (476)
Income (loss) before income taxes 7,093 4,895 5,348 (5,044) (5,404) (3,036)
Income tax expense (benefit) 1,844 1,395 1,390 (4,637) (4,048) (2,780)
Net income (loss) $ 5,249 $ 3,500 $ 3,958 $ (407) $ (1,356) $ (256)
Period-end total assets $ 616,609 $ 641,809 $ 264,141 $ 224,375
(1)
There were no material intersegment revenues.


02.25.2021 22:57PM 62539
The table below presents noninterest income and the associated components for 2020, 2019 and 2018 for each business
segment, All Other and the total Corporation. For more information, see Note 2 – Net Interest Income and Noninterest Income.
Noninterest Income by Business Segment and All Other

Global Wealth &
Total Corporation Consumer Banking Investment Management
(Dollars in millions) 2020 2019 2018 2020 2019 2018 2020 2019 2018
Card income
Interchange fees $ 3,954 $ 3,834 $ 3,866 $ 3,027 $ 3,174 $ 3,196 $ 36 $ 59 $ 81
Other card income 1,702 1,963 1,958 1,646 1,910 1,907 42 42 46
Total card income 5,656 5,797 5,824 4,673 5,084 5,103 78 101 127
Service charges
Deposit-related fees 5,991 6,588 6,667 3,417 4,218 4,300 67 68 73
Lending-related fees 1,150 1,086 1,100 — — — — — —
Total service charges 7,141 7,674 7,767 3,417 4,218 4,300 67 68 73
Asset management fees 10,708 10,241 10,189 146 144 147 10,578 10,130 10,042
Brokerage fees 3,866 3,661 3,971 127 149 172 1,692 1,740 1,917
Total investment and brokerage services 14,574 13,902 14,160 273 293 319 12,270 11,870 11,959
Underwriting income 4,698 2,998 2,722 — — — 391 401 335
Syndication fees 861 1,184 1,347 — — — — — —
Financial advisory services 1,621 1,460 1,258 — — — — — 2
Total investment banking fees 7,180 5,642 5,327 — — — 391 401 337
Total fees and commissions 34,551 33,015 33,078 8,363 9,595 9,722 12,806 12,440 12,496
Market making and similar activities 8,355 9,034 9,008 2 6 8 63 113 112
Other income (loss) (738) 304 772 199 828 863 247 481 580
Total noninterest income $ 42,168 $ 42,353 $ 42,858 $ 8,564 $ 10,429 $ 10,593 $ 13,116 $ 13,034 $ 13,188
Global Banking Global Markets All Other (1)

2020 2019 2018 2020 2019 2018 2020 2019 2018
Card income
Interchange fees $ 499 $ 519 $ 503 $ 391 $ 81 $ 86 $ 1 $ 1 $ —
Other card income 14 13 8 — (1) (2) — (1) (1)
Total card income 513 532 511 391 80 84 1 — (1)
Service charges
Deposit-related fees 2,298 2,121 2,111 177 156 161 32 25 22
Lending-related fees 940 894 916 210 192 184 — — —
Total service charges 3,238 3,015 3,027 387 348 345 32 25 22
Asset management fees — — — — — — (16) (33) —
Brokerage fees 74 34 94 1,973 1,738 1,780 — — 8
Total investment and brokerage services 74 34 94 1,973 1,738 1,780 (16) (33) 8
Underwriting income 2,070 1,227 1,090 2,449 1,555 1,495 (212) (185) (198)
Syndication fees 482 574 648 379 610 698 — — 1
Financial advisory services 1,458 1,336 1,153 163 123 103 — 1 —
Total investment banking fees 4,010 3,137 2,891 2,991 2,288 2,296 (212) (184) (197)
Total fees and commissions 7,835 6,718 6,523 5,742 4,454 4,505 (195) (192) (168)
Market making and similar activities 103 235 260 8,471 7,065 7,260 (284) 1,615 1,368
Other income (loss) 2,036 2,855 2,225 (93) 180 561 (3,127) (4,040) (3,457)
Total noninterest income $ 9,974 $ 9,808 $ 9,008 $ 14,120 $ 11,699 $ 12,326 $ (3,606) $ (2,617) $ (2,257)
(1)
All Other includes eliminations of intercompany transactions.


02.25.2021 22:57PM 62539
Business Segment Reconciliations

Segments’ total revenue, net of interest expense $ 89,599 $ 94,222 $ 93,255
Adjustments (1):
ALM activities 375 241 (325)
Liquidating businesses, eliminations and other (3,947) (2,624) (1,300)
FTE basis adjustment (499) (595) (610)
Consolidated revenue, net of interest expense $ 85,528 $ 91,244 $ 91,020
Segments’ total net income 18,301 28,786 28,403
Adjustments, net-of-tax (1):
ALM activities 279 202 (222)
Liquidating businesses, eliminations and other (686) (1,558) (34)
Consolidated net income $ 17,894 $ 27,430 $ 28,147
December 31
2020 2019
Segments’ total assets $ 2,555,486 $ 2,209,704
Adjustments (1):
ALM activities, including securities portfolio 1,176,071 721,806
Elimination of segment asset allocations to match liabilities (977,685) (565,378)
Other 65,755 67,947
Consolidated total assets $ 2,819,627 $ 2,434,079
(1)
Adjustments include consolidated income, expense and asset amounts not specifically allocated to individual business segments.
NOTE 24 Parent Company Information

The following tables present the Parent Company-only financial information.
Condensed Statement of Income

Income
Dividends from subsidiaries:
Bank holding companies and related subsidiaries $ 10,352 $ 27,820 $ 28,575
Nonbank companies and related subsidiaries — — 91
Interest from subsidiaries 8,825 9,502 8,425
Other income (loss) (138) 74 (1,025)
Total income 19,039 37,396 36,066
Expense
Interest on borrowed funds from related subsidiaries 136 451 235
Other interest expense 4,119 5,899 6,425
Noninterest expense 1,651 1,641 1,600
Total expense 5,906 7,991 8,260
Income before income taxes and equity in undistributed earnings of subsidiaries 13,133 29,405 27,806
Income tax expense (benefit) 649 341 (281)
Income before equity in undistributed earnings of subsidiaries 12,484 29,064 28,087
Equity in undistributed earnings (losses) of subsidiaries:
Bank holding companies and related subsidiaries 5,372 (1,717) 306
Nonbank companies and related subsidiaries 38 83 (246)
Total equity in undistributed earnings of subsidiaries 5,410 (1,634) 60
Net income $ 17,894 $ 27,430 $ 28,147


02.25.2021 22:57PM 62539
Condensed Balance Sheet

December 31
Assets
Cash held at bank subsidiaries (1) $ 5,893 $ 5,695
Securities 701 656
Receivables from subsidiaries:
Bank holding companies and related subsidiaries 206,566 173,301
Banks and related subsidiaries 213 51
Nonbank companies and related subsidiaries 410 391
Investments in subsidiaries:
Bank holding companies and related subsidiaries 305,818 297,465
Nonbank companies and related subsidiaries 3,715 3,663
Other assets 9,850 9,438
Total assets $ 533,166 $ 490,660
Liabilities and shareholders’ equity
Accrued expenses and other liabilities $ 15,965 $ 13,381
Payables to subsidiaries:
Banks and related subsidiaries 129 458
Nonbank companies and related subsidiaries 11,067 12,102
Long-term debt 233,081 199,909
Total liabilities 260,242 225,850
Shareholders’ equity 272,924 264,810
Total liabilities and shareholders’ equity $ 533,166 $ 490,660
(1)
Balance includes third-party cash held of $7 million and $4 million at December 31, 2020 and 2019.
Condensed Statement of Cash Flows

Operating activities
Net income $ 17,894 $ 27,430 $ 28,147
Reconciliation of net income to net cash provided by (used in) operating activities:
Equity in undistributed (earnings) losses of subsidiaries (5,410) 1,634 (60)
Other operating activities, net 14,303 16,973 (3,706)
Net cash provided by operating activities 26,787 46,037 24,381
Investing activities
Net sales (purchases) of securities (4) (17) 51
Net payments to subsidiaries (33,111) (19,121) (2,262)
Other investing activities, net (7) 7 48
Net cash used in investing activities (33,122) (19,131) (2,163)
Financing activities
Net increase (decrease) in other advances (422) (1,625) 3,867
Proceeds from issuance of long-term debt 43,766 29,315 30,708
Retirement of long-term debt (23,168) (21,039) (29,413)
Proceeds from issuance of preferred stock 2,181 3,643 4,515
Redemption of preferred stock (1,072) (2,568) (4,512)
Common stock repurchased (7,025) (28,144) (20,094)
Cash dividends paid (7,727) (5,934) (6,895)
Net cash provided by (used in) financing activities 6,533 (26,352) (21,824)
Net increase in cash held at bank subsidiaries 198 554 394
Cash held at bank subsidiaries at January 1 5,695 5,141 4,747
Cash held at bank subsidiaries at December 31 $ 5,893 $ 5,695 $ 5,141


02.25.2021 22:57PM 62539
NOTE 25 Performance by Geographical Area as applicable. This requires certain judgments related to the
The Corporation’s operations are highly integrated with allocation of revenue so that revenue can be appropriately
operations in both U.S. and non-U.S. markets. The non-U.S. matched with the related capital or expense deployed in the
business activities are largely conducted in Europe, the Middle region. Certain asset, liability, income and expense amounts
East and Africa and in Asia. The Corporation identifies its have been allocated to arrive at total assets, total revenue, net
geographic performance based on the business unit structure of interest expense, income before income taxes and net
used to manage the capital or expense deployed in the region income by geographic area as presented below.
Total Revenue,
Total Assets at Net of Interest Income Before
(Dollars in millions) Year End (1) Expense (2) Income Taxes Net Income
(3)
U.S. 2020 $ 2,490,247 $ 75,576 $ 18,247 $ 16,692
2019 2,122,734 81,236 30,699 25,937
2018 80,777 31,904 26,407
Asia 2020 99,283 4,232 1,051 788
2019 102,440 3,491 765 570
2018 3,507 865 520
Europe, Middle East and Africa 2020 202,701 4,491 (596) 264
2019 178,889 5,310 921 672
2018 5,632 1,543 1,126
Latin America and the Caribbean 2020 27,396 1,229 293 150
2019 30,016 1,207 369 251
2018 1,104 272 94
Total Non-U.S. 2020 329,380 9,952 748 1,202
2019 311,345 10,008 2,055 1,493
2018 10,243 2,680 1,740
Total Consolidated 2020 $ 2,819,627 $ 85,528 $ 18,995 $ 17,894
2019 2,434,079 91,244 32,754 27,430
2018 91,020 34,584 28,147
(1)
Total assets include long-lived assets, which are primarily located in the U.S.
(2)
There were no material intercompany revenues between geographic regions for any of the periods presented.
(3)
Substantially reflects the U.S.


02.25.2021 22:57PM 62539
Glossary
Alt-A Mortgage – A type of U.S. mortgage that is considered Margin Receivable – An extension of credit secured by eligible
riskier than A-paper, or “prime,” and less risky than “subprime,” securities in certain brokerage accounts.
the riskiest category. Typically, Alt-A mortgages are
characterized by borrowers with less than full documentation, Matched Book – Repurchase and resale agreements or
lower credit scores and higher LTVs. securities borrowed and loaned transactions where the overall
asset and liability position is similar in size and/or maturity.
Assets Under Management (AUM) – The total market value of Generally, these are entered into to accommodate customers
assets under the investment advisory and/or discretion of GWIM where the Corporation earns the interest rate spread.
which generate asset management fees based on a percentage
of the assets’ market values. AUM reflects assets that are Mortgage Servicing Rights (MSR) – The right to service a
generally managed for institutional, high net worth and retail mortgage loan when the underlying loan is sold or securitized.
clients, and are distributed through various investment products Servicing includes collections for principal, interest and escrow
including mutual funds, other commingled vehicles and separate payments from borrowers and accounting for and remitting
accounts. principal and interest payments to investors.
Banking Book – All on- and off-balance sheet financial Nonperforming Loans and Leases – Includes loans and leases
instruments of the Corporation except for those positions that that have been placed on nonaccrual status, including
are held for trading purposes. nonaccruing loans whose contractual terms have been
restructured in a manner that grants a concession to a borrower
Brokerage and Other Assets – Non-discretionary client assets experiencing financial difficulties.
which are held in brokerage accounts or held for safekeeping.
Prompt Corrective Action (PCA) – A framework established by the
Committed Credit Exposure – Any funded portion of a facility plus U.S. banking regulators requiring banks to maintain certain
the unfunded portion of a facility on which the lender is legally levels of regulatory capital ratios, comprised of five categories
bound to advance funds during a specified period under of capitalization: “well capitalized,” “adequately capitalized,”
prescribed conditions. “undercapitalized,” “significantly undercapitalized” and
“critically undercapitalized.” Insured depository institutions that
Credit Derivatives – Contractual agreements that provide fail to meet certain of these capital levels are subject to
protection against a specified credit event on one or more increasingly strict limits on their activities, including their ability
referenced obligations. to make capital distributions, pay management compensation,
Credit Valuation Adjustment (CVA) – A portfolio adjustment grow assets and take other actions.
required to properly reflect the counterparty credit risk exposure Subprime Loans – Although a standard industry definition for
as part of the fair value of derivative instruments. subprime loans (including subprime mortgage loans) does not
Debit Valuation Adjustment (DVA) – A portfolio adjustment exist, the Corporation defines subprime loans as specific
required to properly reflect the Corporation’s own credit risk product offerings for higher risk borrowers.
exposure as part of the fair value of derivative instruments and/ Troubled Debt Restructurings (TDRs) – Loans whose contractual
or structured liabilities. terms have been restructured in a manner that grants a
Funding Valuation Adjustment (FVA) – A portfolio adjustment concession to a borrower experiencing financial difficulties.
required to include funding costs on uncollateralized derivatives Certain consumer loans for which a binding offer to restructure
and derivatives where the Corporation is not permitted to use has been extended are also classified as TDRs.
the collateral it receives. Value-at-Risk (VaR) – VaR is a model that simulates the value of
Interest Rate Lock Commitment (IRLC) – Commitment with a a portfolio under a range of hypothetical scenarios in order to
loan applicant in which the loan terms are guaranteed for a generate a distribution of potential gains and losses. VaR
designated period of time subject to credit approval. represents the loss the portfolio is expected to experience with
a given confidence level based on historical data. A VaR model
Letter of Credit – A document issued on behalf of a customer to is an effective tool in estimating ranges of potential gains and
a third party promising to pay the third party upon presentation losses on our trading portfolios.
of specified documents. A letter of credit effectively substitutes
the issuer’s credit for that of the customer.
Loan-to-value (LTV) – A commonly used credit quality metric. LTV

is calculated as the outstanding carrying value of the loan
divided by the estimated value of the property securing the loan.


02.25.2021 22:57PM 62539
Key Metrics
Active Digital Banking Users – Mobile and/or online users with Operating Margin – Income before income taxes divided by total
activity at period end. revenue, net of interest expense.
Active Mobile Banking Users – Mobile users with activity at Risk-adjusted Margin – Difference between total revenue, net of
period end. interest expense, and net credit losses divided by average
loans.
Book Value – Ending common shareholders' equity divided by
ending common shares outstanding. Return on Average Allocated Capital – Adjusted net income
divided by allocated capital.
Deposit Spread – Annualized net interest income divided by
average deposits. Return on Average Assets – Net income divided by total average
assets.
Efficiency Ratio – Noninterest expense divided by total revenue,
net of interest expense. Return on Average Common Shareholders' Equity – Net income
applicable to common shareholders divided by average common
Financial advisor productivity – Adjusted MLGWM annualized shareholders' equity.
revenue divided by average financial advisors.
Return on Average Shareholders' Equity – Net income divided by
Gross Interest Yield – Effective annual percentage rate divided by average shareholders' equity.
average loans.
Net Interest Yield – Net interest income divided by average total

interest-earning assets.


02.25.2021 22:57PM 62539
Acronyms
ABS Asset-backed securities G-SIB Global systemically important bank
AFS Available-for-sale GSE Government-sponsored enterprise
AI Artificial intelligence GWIM Global Wealth & Investment Management
ALM Asset and liability management HELOC Home equity line of credit
ARR Alternative reference rates HQLA High Quality Liquid Assets
AUM Assets under management HTM Held-to-maturity
AVM Automated valuation model IBOR Interbank Offered Rates
BANA Bank of America, National Association ICAAP Internal Capital Adequacy Assessment Process
BHC Bank holding company IRLC Interest rate lock commitment
BofAS BofA Securities, Inc. IRM Independent Risk Management
BofASE BofA Securities Europe SA ISDA International Swaps and Derivatives Association,
bps basis points Inc.
CAE Chief Audit Executive LCR Liquidity Coverage Ratio
CAO Chief Administrative Officer LHFS Loans held-for-sale
CCAR Comprehensive Capital Analysis and Review LIBOR London Interbank Offered Rate
CDO Collateralized debt obligation LTV Loan-to-value
CDS Credit default swap MBS Mortgage-backed securities
CECL Current expected credit losses MD&A Management’s Discussion and Analysis of
CET1 Common equity tier 1 Financial Condition and Results of Operations
CFPB Consumer Financial Protection Bureau MLGWM Merrill Lynch Global Wealth Management
CFTC Commodity Futures Trading Commission MLI Merrill Lynch International
CLO Collateralized loan obligation MLPCC Merrill Lynch Professional Clearing Corp
CLTV Combined loan-to-value MLPF&S Merrill Lynch, Pierce, Fenner & Smith Incorporated
CRO Chief Risk Officer MRC Management Risk Committee
CVA Credit valuation adjustment MSA Metropolitan Statistical Area
DIF Deposit Insurance Fund MSR Mortgage servicing right
DVA Debit valuation adjustment NOL Net operating loss
ECL Expected credit losses NSFR Net Stable Funding Ratio
EMRC Enterprise Model Risk Committee OCC Office of the Comptroller of the Currency
EPS Earnings per common share OCI Other comprehensive income
ERC Enterprise Risk Committee OREO Other real estate owned
ESG Environmental, social and governance OTC Over-the-counter
EU European Union PCA Prompt Corrective Action
FCA Financial Conduct Authority PPP Paycheck Protection Program
FDIC Federal Deposit Insurance Corporation RMBS Residential mortgage-backed securities
FDICIA Federal Deposit Insurance Corporation RSU Restricted stock unit
Improvement Act of 1991 RWA Risk -weighted assets
FHA Federal Housing Administration SBA Small Business Administration
FHLB Federal Home Loan Bank SBLC Standby letter of credit
FHLMC Freddie Mac SCB Stress capital buffer
FICC Fixed income, currencies and commodities SCCL Single-counterparty credit limits
FICO Fair Isaac Corporation (credit score) SEC Securities and Exchange Commission
FLUs Front line units SLR Supplementary leverage ratio
FNMA Fannie Mae SOFR Secured Overnight Financing Rate
FTE Fully taxable-equivalent SONIA Sterling Overnight Index Average
FVA Funding valuation adjustment TDR Troubled debt restructurings
GAAP Accounting principles generally accepted in the TLAC Total loss-absorbing capacity
United States of America
VA U.S. Department of Veterans Affairs
GDPR General Data Protection Regulation
VaR Value-at-Risk
GLS Global Liquidity Sources
VIE Variable interest entity
GNMA Government National Mortgage Association


02.25.2021 22:57PM 62539
Disclosure Controls and Procedures

As of the end of the period covered by this report and pursuant to Rule 13a-15 of the Securities Exchange Act of 1934, as amended
(Exchange Act), Bank of America’s management, including the Chief Executive Officer and Chief Financial Officer, conducted an
evaluation of the effectiveness and design of our disclosure controls and procedures (as that term is defined in Rule 13a-15(e) of
the Exchange Act). Based upon that evaluation, Bank of America’s Chief Executive Officer and Chief Financial Officer concluded that
Bank of America’s disclosure controls and procedures were effective, as of the end of the period covered by this report.


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Executive Management Team and Management Committee
Executive Management Team Thomas K. Montag* Lauren A. Mogensen

Brian T. Moynihan* Chief Operating Officer Global Compliance and Operational
Chairman of the Board and Thong M. Nguyen* Risk Executive
Chief Executive Officer Vice Chairman, Bank of America Tram V. Nguyen
Raul A. Anaya Andrew M. Sieg* Global Corporate Strategy Executive
President, Business Banking President, Merrill Lynch Wealth Holly O’Neill
Dean C. Athanasia* Management Head of Consumer, Small Business &
President, Retail and Preferred Andrea B. Smith* Wealth Management Client Care
& Small Business Banking Chief Administrative Officer David Reilly
Catherine P. Bessant* Bruce R. Thompson Global Banking & Markets, Enterprise
Chief Operations and Vice Chairman, Bank of America Risk and Finance Technology, and Core
Technology Officer Technology Infrastructure Executive
Sanaz Zaimi
D. Steve Boland Head of Global Fixed Income, Lorna R. Sabbia
President, Retail Currencies and Commodities Sales; Head of Retirement and Personal
CEO of BofA Securities Europe SA, and Wealth Solutions
Alastair M. Borthwick
President, Global Commercial Banking Country Executive for France Robert A. Schleusner
Head of Wholesale Credit
Sheri B. Bronstein* Management Committee**
Chief Human Resources Officer April Schneider
Michael C. Ankrom, Jr. Head of Consumer & Small Business
James P. DeMare Global Banking Chief Risk Officer, Products
President, Global Markets Enterprise Credit Risk and Enterprise
Risk Appetite Thomas M. Scrivener
Paul M. Donofrio* Consumer, Small Business & Wealth
Chief Financial Officer Keith T. Banks Management Operations Executive
Vice Chairman, Head of
Anne M. Finucane Jiro Seguchi
Investment Solutions Group
Vice Chairman, Bank of America Co-President of Asia Pacific, and
Aditya Bhasin Head of Asia Pacific Global Corporate
Geoffrey S. Greener*
Consumer, Small Business & Wealth and Investment Banking
Chief Risk Officer
Management, Global Human Resources,
Christine P. Katziff Corporate Audit & Credit Review, Legal Jin Su
Chief Audit Executive Technology, Third-Party Management Co-President of Asia Pacific, and
and Workspace Services Executive Co-Head of Asia Pacific Fixed Income,
Kathleen A. Knox*
Currencies & Commodities
President, Private Bank Alexandre Bettamio
President, Latin America David C. Tyrie
Matthew M. Koder
Head of Digital
President, Global Corporate & Rudolf A. Bless
Investment Banking Chief Accounting Officer Anne Walker
Global Real Estate and Strategic
David G. Leitch* Candace E. Browning-Platt Initiatives Executive
Global General Counsel Head of Global Research
Aron D. Levine Sharon L. Miller
President, Preferred and Consumer Head of Small Business
Banking & Investments
Andrei Magasiner
Bernard A. Mensah Treasurer
President, International
E. Lee McEntire
Head of Investor Relations
* Executive Officer
** All members of the Executive Management Team are also members of the Management Committee

Board of Directors
Board of Directors
Brian T. Moynihan Thomas J. May
Chairman of the Board and Former Chairman, President, and Chief
Chief Executive Officer, Executive Officer, Eversource Energy
Bank of America Corporation Lionel L. Nowell III
Jack O. Bovender, Jr.* Lead Independent Director Successor,
Lead Independent Director, Bank of America; Former Senior Vice
Bank of America Corporation; President and Treasurer, PepsiCo, Inc.
Former Chairman and Denise L. Ramos
Chief Executive Officer, HCA Inc. Former Chief Executive Officer and
Sharon L. Allen President, ITT Inc.
Former Chairman, Deloitte Clayton S. Rose
Susan S. Bies President, Bowdoin College
Former Member, Federal Reserve Michael D. White
Board of Governors Former Chairman, President, and
Frank P. Bramble, Sr. Chief Executive Officer, DIRECTV; Lead
Former Executive Vice Chairman, Director, Kimberly-Clark Corporation
MBNA Corporation Thomas D. Woods
Pierre J.P. de Weck Former Vice Chairman and Senior
Former Chairman and Global Head Executive Vice President of CIBC;
of Private Wealth Management, Former Chairman, Hydro One Limited
Deutsche Bank R. David Yost
Arnold W. Donald Former Chief Executive Officer,
President and Chief Executive Officer, AmerisourceBergen Corporation
Carnival Maria T. Zuber
Linda P. Hudson Vice President for Research and
Former Chairman and E.A. Griswold Professor of
Chief Executive Officer, Geophysics, MIT
The Cardea Group, LLC;
Former President and Chief Executive
Officer, BAE
Monica C. Lozano
Chief Executive Officer, College
Futures Foundation; Former Chairman,
US Hispanic Media Inc.
*Not standing for reelection at the 2021 Annual Meeting of Shareholders

Corporate Information
Headquarters Annual Report on Form 10-K

The principal executive offices of Bank of America The Corporation’s 2020 Annual Report on Form 10-K
Corporation (the Corporation) are located in the Bank is available at http://investor.bankofamerica.com. The
of America Corporate Center, 100 North Tryon Street, Corporation also will provide a copy of the 2020 Annual
Charlotte, NC 28255. Report on Form 10-K (without exhibits) upon written request
addressed to:
Stock Listing
The Corporation’s common stock is listed on the New Office of the Corporate Secretary
York Stock Exchange (NYSE) under the symbol BAC. The Bank of America Corporate Center
stock is typically listed as BankAm in newspapers. As of 100 North Tryon Street
December 31, 2020, there were 157,293 registered holders NC1-007-56-06
of the Corporation’s common stock. Charlotte, NC 28255
Investor Relations Shareholder Inquiries
Analysts, portfolio managers and other investors seeking For inquiries concerning dividend checks, electronic deposit
additional information about Bank of America stock of dividends, dividend reinvestment, tax statements,
should contact our Equity Investor Relations group electronic delivery, transferring ownership, address changes
at 1.704.386.5681 or i_r@bofa.com. For additional or lost or stolen stock certificates, contact Bank of America
information about Bank of America from a credit Shareholder Services at Computershare Trust Company,
perspective, including debt and preferred securities, N.A., via the Internet at www.computershare.com/bac; call
contact our Fixed Income Investor Relations group at 1.800.642.9855; or write to P.O. Box 505005, Louisville, KY
1.866.607.1234 or fixedincomeir@bofa.com. Visit the 40233. For general shareholder information, contact Bank of
Investor Relations area of the Bank of America website, America Office of the Corporate Secretary at 1.800.521.3984.
http://investor.bankofamerica.com, for stock and dividend Shareholders outside of the United States and Canada may
information, financial news releases, links to Bank of America call 1.781.575.2621. Hearing impaired 1.888.403.9700 or
SEC filings, electronic versions of our annual reports and outside the United States 1.781.575.4592.
other items of interest to the Corporation’s shareholders.
Electronic Delivery
Customers
As part of our ongoing commitment to reduce paper
For assistance with Bank of America products and services, consumption, we offer electronic methods for customer
call 1.800.432.1000, or visit the Bank of America website communications and transactions. Customers can sign up to
at www.bankofamerica.com. Additional toll-free numbers for receive online statements through their Bank of America or
specific products and services are listed on our website at Merrill Lynch Wealth Management account website. In 2012,
www.bankofamerica.com/contact. we adopted the SEC’s Notice and Access rule, which allows
certain issuers to inform shareholders of the electronic
News Media
availability of Proxy materials, including the Annual Report,
News media seeking information should visit our online which significantly reduced the number of printed copies
newsroom at http://newsroom.bankofamerica.com for we produce and mail to shareholders. Shareholders still
news releases, press kits and other items relating to the receiving printed copies can join our efforts by electing to
Corporation, including a complete list of the Corporation’s receive an electronic copy of the Annual Report and Proxy
media relations specialists grouped by business specialty materials. If you have an account maintained in your name at
or geography. Computershare Investor Services, you may sign up for this
service at www.computershare.com/bac. If your shares are
held by a broker, bank or other nominee, you may elect to
receive an electronic copy of the Proxy materials online at
www.proxyvote.com, or contact your broker.

Bank of America Corporation (“Bank of America”) is a financial holding
company that, through its subsidiaries and affiliated companies, provides
banking and non-banking financial services.
“Bank of America” and “BofA Securities” are the marketing names used by the Global Banking and Global Markets
divisions of Bank of America Corporation. Lending, other commercial banking activities, and trading in certain
financial instruments are performed globally by banking affiliates of Bank of America Corporation, including
Bank of America, N.A., Member FDIC. Trading in securities and financial instruments, and strategic advisory, and
other investment banking activities, are performed globally by investment banking affiliates of Bank of America
Corporation (“Investment Banking Affiliates”), including, in the United States, BofA Securities, Inc. and Merrill
Lynch Professional Clearing Corp., both of which are registered broker-dealers and Members of SIPC, and, in other
jurisdictions, by locally registered entities. BofA Securities, Inc. and Merrill Lynch Professional Clearing Corp. are
registered as futures commission merchants with the CFTC and are members of the NFA.
Bank of America is a marketing name for the Retirement Services business of Bank of America Corporation (“BofA
Corp.”). Banking activities may be performed by wholly owned banking affiliates of BofA Corp., including Bank of
America, N.A., member FDIC.
Banking products are provided by Bank of America, N.A., and affiliated banks, Members FDIC, and wholly owned
subsidiaries of BofA Corp.
Bank of America Private Bank is a division of Bank of America, N.A.,

Member FDIC, and a wholly owned subsidiary of Bank of America Corporation.
Merrill Lynch, Pierce, Fenner & Smith Incorporated (also referred to as “MLPF&S” or “Merrill”) makes available
certain investment products sponsored, managed, distributed or provided by companies that are affiliates of
Bank of America Corporation (“BofA Corp.”). MLPF&S is a registered broker-dealer, registered investment adviser,
Member SIPC, and a wholly owned subsidiary of BofA Corp.
BofA Global Research is research produced by BofA Securities, Inc. (“BofAS”) and/or one or more of its affiliates.
BofAS is a registered broker-dealer, Member SIPC, and wholly owned subsidiary of Bank of America Corporation.
Bank of America Private Bank is a division of Bank of America, N.A., Member FDIC, and a wholly owned subsidiary
of BofA Corp.
The ranking or ratings shown herein may not be representative of all client experiences because they reflect
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00-04-1379B 2020 BAC Annual Report
BANK OF AMERICA CORPORATION | 2020 ANNUAL REPORT

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Coming together

Annual Report 2020

I hope this finds you safe and well.

2010 to 2014: Dramatic 2015 to 2020: Net income

BANK OF AMERICA 2020 | 1

In March of 2020, the stock price for banks in general saw

Our stock price declined 49% in March from the beginning

In 2020, we also continued to make meaningful progress

2 | BANK OF AMERICA 2020

community partners, nonprofits, and other venues. We have

BANK OF AMERICA 2020 | 3

Revenue¹,² FY2020 Net income³ FY2020

Global Markets Consumer Global Markets Consumer

Global Banking GWIM Global Banking GWIM

Note: Amounts may not total due to rounding.

4 | BANK OF AMERICA 2020

In Global Markets, full-year sales and trading revenue for 2020

BANK OF AMERICA 2020 | 5

Grow within our risk framework

BANK OF AMERICA 2020 | 7

$2B Our commitment to racial equality and economic opportunity

8 | BANK OF AMERICA 2020

Total assets Total deposits

2016 2017 2018

A message from incoming

BANK OF AMERICA 2020 | 11

R. David Yost Maria T. Zuber

We set the tone at the top through oversight by our Board

12 | BANK OF AMERICA 2020

Andrea B. Smith Bruce R. Thompson Sanaz Zaimi

BANK OF AMERICA 2020 | 13

14 | BANK OF AMERICA 2020

BANK OF AMERICA 2020 | 15

Employees around the world continued to provide advice,

Our employees have also delivered critical financial relief for

16 | BANK OF AMERICA 2020

We pledged $100 million toward medical supplies, food

And, in recognition of the broad and deep impact the

Donating PPE in our communities

Investing in our communities

$100M $250M $1B

Looking ahead to 2021

BANK OF AMERICA 2020 | 17

in our financial centers, we believe we can quickly adapt

Q. How is Bank of America meeting the needs of today’s

Q. Bank of America launched Balance Assist last year.

18 | BANK OF AMERICA 2020

Q. Clients often begin a financial relationship with Bank

Aron: We are committed to meeting the full range of our

Growth of digital banking, lending

BANK OF AMERICA 2020 | 19

20 | BANK OF AMERICA 2020

We believe all of these efforts resonated with our clients

BANK OF AMERICA 2020 | 21

For example, clients now use Mobile Easy Sign digital

22 | BANK OF AMERICA 2020

In 2020, during a year of unprecedented market volatility,

44,000+ BofA Global Research demonstrated its commitment to our

BANK OF AMERICA 2020 | 23

“Merrill benefits tremendously from the technology