Bank of America Announces Third-Quarter Net Loss of $1.0 Billion

* Approximately $2.6 Billion in Writedowns From Improvement in Company Credit Spreads * Terminating Government Guarantee Term Sheet Costs $402 Million * Merrill Lynch Platform Continues to Boost Results * Extends $183.7 Billion in Credit in the Third Quarter * Tier 1 Capital Ratio Rises to 12.46 Percent; Tier 1 Common Ratio Rises to 7.25 Percent * Adds $2.1 Billion to Reserve for Credit Losses CHARLOTTE, N.C. -- Bank of America Corporation (NYSE: BAC) reported a third-quarter 2009 net loss of $1.0 billion. After deducting preferred dividends of $1.2 billion, including $893 million related to dividends paid to the U.S. government, the diluted loss per share was $0.26. Those results compared with net income of $1.2 billion, or diluted earnings per share of $0.15, during the year-ago period. Through the first nine months of the year, the company had net income of $6.5 billion, or $0.39 per share after preferred dividends, compared with $5.8 billion, or $1.09 per share a year earlier. Results were negatively impacted by continued weakness in the U.S. and global economies and stress on the consumer, which continues to result in high credit costs. Earnings in the quarter were affected by $2.6 billion in pretax mark-to-market and credit valuation adjustments on certain liabilities, including the Merrill Lynch structured notes, and a $402 million pretax charge to pay the U.S. government to terminate its asset guarantee term sheet. Despite the loss in the period, the company strengthened its reserves, capital position and liquidity through efficient balance sheet and capital management. Third-Quarter 2009 Business Highlights * Average retail deposits in the quarter increased $93.0 billion, or 16 percent, from a year earlier, including the net impact of $72.1 billion in balances from Merrill Lynch and Countrywide. Excluding Countrywide and Merrill Lynch, retail deposits grew $20.9 billion, or 4 percent, from the year-ago quarter. * Global Wealth and Investment Management was ranked No. 1 among U.S. wealth managers with more than 25 percent of the nations top 100 financial advisors, according to two surveys conducted by Barrons. The number of households with assets greater than $250,000 increased 4 percent compared with the second quarter including the impact of the market. * Bank of America received Federal Deposit Insurance Corp. (FDIC) approval to exit the debt guarantee program under the FDICs Temporary Liquidity Guarantee Program (TLGP). Additionally, the company will opt out of the six-month extension of the Transaction Account Guarantee Program (TAGP) that guaranteed full insurance coverage from the FDIC on non-interest-bearing transactional accounts greater than $250,000. * Bank of America completed the conversion of Countrywides deposit systems. The integration of Merrill Lynch remained on track with cost savings expected to surpass original estimates for the first year. * For the nine months ended September 30, Bank of America Merrill Lynch ranked No. 1 in high-yield corporate debt, leveraged loans and mortgage-backed assets based on volume, both globally and in the U.S., No. 3 and No. 2 in global and U.S. investment banking fees, respectively, and No. 2 in global and U.S. asset-backed securities and syndicated loans based on volume, according to Dealogic third-quarter league tables. * During the quarter, Bank of America signed an agreement to sell the long-term asset management business of Columbia Management to Ameriprise Financial for approximately $1! billion , subject to certain adjustments. The transaction is expected to close in spring 2010. * Bank of America funded $95.7 billion in first mortgages, helping nearly 450,000 people either purchase a home or refinance their existing mortgage. This funding included $23.3 billion in mortgages made to 154,000 low- and moderate-income borrowers. Approximately 39 percent of first mortgages were for purchases. * To help homeowners avoid foreclosure, Bank of America has provided rate relief or agreed to modifications with approximately 215,000 customers during the first nine months of 2009. In addition, approximately 98,000 Bank of America customers are already in a trial period modification under the governments Making Home Affordable program at September 30. * Bank of America extended $183.7 billion in credit during the quarter, including commercial renewals of $50.9 billion, according to preliminary data. New credit included $95.7 billion in first mortgages, $65.5 billion in commercial non-real estate, approximately $8.3 billion in commercial real estate, $4.5 billion in domestic and small business card, $2.7 billion in home equity products and nearly $7.0 billion in other consumer credit. * During the third quarter, Small Business Banking extended more than $471 million in new credit consisting of credit cards, loans and lines of credit to more than 29,000 customers. * Bank of America continued to respond to consumer needs during the quarter. The company announced an easy-to-understand BankAmericard® Basic™ Visa® credit card that features one basic rate for all types of transactions. The company also announced changes to checking account options and services that will help customers limit overdraft fees.