Quarterly Newsletter - Bank of America

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Quarterly Newsletter

October 2022

Bank of America Reports Q3 Net Income of $7.1 Billion, EPS of $0.81

Our financial results for the third quarter of 2022

On Monday, October 17, 2022, Bank of America reported net income of $7.1B or diluted earnings per share of $0.81 compared with $7.7B or $0.85 per diluted share in the year ago quarter. "We continued to see strong organic client growth across our businesses, with increased client activity helping to drive revenue up by 8%1. Our U.S. consumer clients remained resilient with strong, although slower growing, spending levels and still maintained elevated deposit amounts. Across the bank, we grew loans by 12% over the last year as we delivered the financial resources to support our clients. Our team adapted well to our new capital requirements and improved our CET1 ratio by 49 basis points to 11%, above our new regulatory minimums. I am proud of our teammates' efforts to deliver for our clients and shareholders," said Chair and Chief Executive Officer Brian Moynihan. "We delivered a solid quarter for shareholders as we continued to execute on our responsible growth strategy. We grew revenue, delivered operating leverage for the 5th consecutive quarter(A), continued our steady investments in the franchise, and managed risk well. This helped us to deliver strong pretax, pre-provision income growth year over year," said Chief Financial Officer Alastair Borthwick.

Visit the Bank of America Newsroom for the full news release and supplemental Q3 2022 Financial Information, including additional information about the non-GAAP financial measures contained herein.

Company news

1. Bank of America reports Q3 2022 financial results

2. Financial and business highlights Delivering for our employees

3. Introducing the new Bank of America Sabbatical Program

We continue to support the health of our teammates and our local communities

4. We launched -- and extended -- our Lunch On Us program

We logged more than 8.7 billion steps in our 2022 Global Get Active! challenge

5. In 2022, record 2,600 Bank of America new hires in the U.S. have a military background

Announcing enhanced tools and resources to support our teammates' career mobility Delivering for our clients

6. Erica? tops 1 billion client interactions in four years

Preferred Rewards surpasses 10 million member milestone

7. Merrill Advisor Match transforms the way people find a financial advisor

Bank of America sets record for patents granted during first half of 2022 Delivering for our communities

8. Brian Moynihan hosts global CEOs at Sustainable Markets Initiative Summit

We're doubling our support for Minority Depository Institutions

9. Racial equality and economic opportunity for Hispanic-Latinos were in focus at this year's L'Attitude conference, with Andy Sieg and Raul Anaya

How we're removing barriers to economic opportunity for youth of color Briefs

10. Lead Independent Director Lionel Nowell recognized as "Independent Director of the Year"

Jos? E. Almeida appointed to Bank of America's Board of Directors

D. Steve Boland named as one of Savoy magazine's 2022 Most Influential Black Executives in Corporate America

American Banker recognized Bank of America women executives for their influence and impact within the financial services industry

Retiree and alumni resources

11. Stay alert and know how to protect yourself from cyber criminals' phishing attempts

November is National Caregivers Month -- Talk to your family and friends about how they can protect themselves against fraud and scams

12. Recognition highlights Q3 2022

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Bank of America

Company news

Q3 2022 Financial Highlights2

? Net income of $7.1 billion, or $0.81 per diluted share

? Pretax income declined 7% to $8.3 billion reflecting a reserve build compared to a reserve release in Q3-21(C) ? Pretax, pre-provision income(D) increased 10% to $9.2 billion

? Revenue, net of interest expense, increased 8% to $24.5 billion ? Net interest income (NII)(E) up $2.7 billion, or 24%, to $13.8 billion, driven by benefits from higher interest rates, including lower premium amortization expense, and solid loan growth ? Noninterest income of $10.7 billion decreased $935 million, or 8%, as higher sales and trading revenue was more than offset by lower investment banking and asset management fees as well as lower service charges

? Provision for credit losses of $898 million increased $1.5 billion ? Net reserve build of $378 million vs. net reserve release of $1.1 billion in Q3-21(C) ? Net charge-offs of $520 million increased 12%

? Noninterest expense increased $863 million, or 6%, to $15.3 billion and included $354 million related to the settlement of legacy monoline insurance litigation

? Average loan and lease balances up $114 billion, or 12%, to $1.0 trillion led by strong commercial loan growth as well as higher credit card balances

? Average deposits up $20 billion, or 1%, to $2.0 trillion

? Average Global Liquidity Sources of $941 billion(F)

? Common equity tier 1 (CET1) ratio of 11.0% (Standardized)(G) increased by 49 basis points from Q2-22; paid $1.8 billion in common dividends and repurchased $450 million of common stock7

? Return on average common shareholders' equity ratio of 10.8%; return on average tangible common shareholders' equity ratio of 15.2%8

$10.0 $9.0 $8.0 $7.0 $7.1B $6.0 $5.0 $4.0 $3.0 $2.0 $1.0 $0.0 Q3-22

Bank of America Net Income

$6.2B

$7.1B

$7.0B

$7.7B

Q2-22 Q1-22 Q4-21 Q3-21

Q3 2022 Business Segment Highlights 2,3(B)

Consumer Banking

? Net income of $3.1 billion ? Client balances of $1.6 trillion, up 1%4 ? Average deposits of more than $1 trillion, up $68 billion, or 7% ? Combined credit/debit card spend of $218 billion, up 9%

? Client Activity ? Added ~418,000 net new Consumer checking accounts in Q3-22; 15th consecutive quarter of growth and highest quarter since Q3-08 ? Record 35.6 million Consumer checking accounts with 92% being primary5 ? Small Business checking accounts of 3.7 million, up 5% ? Digital sales grew 36%

Global Wealth and Investment Management

? Net income of $1.2 billion ? Client balances of $3.2 trillion, down 12%, driven by lower market

valuations, partially offset by net client flows ? Pretax margin of 29%

? Client Activity ? AUM balances of $1.3 trillion; $42 billion of AUM flows since Q3-21 ? Average loan and lease balances of $224 billion, up $24 billion, or 12%; 50th consecutive quarter of average loan and lease balance growth ? Added more than 5,700 net new relationships across Merrill and Private Bank

Global Banking

? Net income of $2.0 billion ? Total investment banking fees (excl. self-led) of $1.2 billion, decrease of

46%, reflecting weaker industry-wide underwriting activity this year ? No. 3 in investment banking fees6

? Client Activity ? Average loan and lease balances of $384 billion, up $60 billion, or 18% ? Global Transaction Services revenue of $2.8 billion, up $858 million, or 44%

Global Markets

? Net income of $1.1 billion ? Sales and trading revenue up 13% to $4.1 billion, including net debit

valuation adjustment (DVA) losses of $14 million; Fixed Income Currencies and Commodities (FICC) revenue of $2.6 billion and Equities revenue of $1.5 billion ? Excluding net DVA(H), sales and trading revenue up 13% to $4.1 billion; FICC up 27% to $2.6 billion; Equities down 4% to $1.5 billion ? Zero days of trading losses in Q3-22

See page 11 for endnotes. Amounts may not total due to rounding. 1 Revenue, net of interest expense. 2 Financial Highlights and Business Segment Highlights are compared to the year-ago quarter unless noted. Loan and deposit balances are shown on an average basis unless noted. 3 The Corporation reports the results of operations of its four business segments and All Other on a fully taxable-equivalent (FTE) basis. 4 Sum of ending deposits, loans and leases, including margin receivables, and consumer investments, excluding deposit sweep balances. 5 Represents the percentage of consumer checking accounts that are estimated to be the customer's primary account based on multiple relationship factors (e.g., linked to their direct deposit). 6 Source: Dealogic as of October 1, 2022. 7 Predominantly offsetting shares awarded under equity-based compensation plans. 8 Return on average tangible common shareholders' equity ratio and tangible book value per common share represent non-GAAP financial measures. For more information, see page 12.

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Bank of America

Delivering for our employees

Introducing the new Bank of America Sabbatical Program

In September, we announced details of our new Bank of America Sabbatical Program. This program recognizes employees who have built their career with us and is another example of our focus on teammates' emotional wellness. It's also how we are delivering on our commitment to be a great place to work.

More time for teammates to focus on their priorities The Bank of America Sabbatical Program provides eligible employees with the opportunity to take 4-6 weeks paid time off to reinvest in their priorities in life. This opportunity recognizes tenure at the company at certain career milestones and is designed to help them be at their best at work and at home.

Beginning in 2023, recognized milestones begin at 15 years and every 5 years thereafter. Employees can take two sabbaticals over the course of their Bank of America career, providing they meet eligibility criteria. How teammates choose to spend the time away is up to them. In our pilot program, employees celebrated achievements, focused on personal passions, volunteered in the community, focused on family or simply took a break.

To take part in the 2023 Sabbatical Program, teammates must meet all eligibility criteria including reaching a recognized milestone anniversary through continuous service in the 2023 calendar year. If a teammate celebrated a recognized milestone in prior years, they will be eligible to participate on their next recognized milestone anniversary.

During sabbatical time away, employee base pay will continue as scheduled. Employees who are compensated through a variable compensation plan will receive more information about how their variable compensation will be adjusted to address time taken for sabbatical.

We continue to support the health of our teammates and our local communities

Medical experts agree that prevention is critical to good health, and we continue to keep our teammates' health and safety a top priority. With flu season approaching, we're offering teammates the opportunity to take preventive measures to help maintain their overall wellness and support their local markets. On behalf of teammates who get their annual flu shot between Sept. 1 and Nov. 23, we will make a $50 donation to a hunger relief organization in local markets. An additional $50 donation will be made for those who receive and record their coronavirus vaccine or booster between Feb. 1 and Nov. 23. Participation is completely optional and not a requirement. If teammates do choose to participate, here are a few key reminders of our support:

? We provide onsite clinics for flu shots and coronavirus vaccines and boosters at many sites in the U.S. ? U.S. employees have up to a total of eight hours of paid time off to get their coronavirus vaccine or booster. ? Flu shots are available at no cost for teammates and members of their household if enrolled through a bank medical plan or by using a voucher.

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Bank of America

We launched -- and extended -- our Lunch On Us program

Delivering for our employees

We continue to enjoy the collaboration and camaraderie that come from being together in-person. One of the many benefits is the opportunity for informal connections -- catching up over coffee, passing in the hallways or grabbing a meal. To help show our appreciation to our teammates -- and to encourage these informal connections -- we announced lunch on us for all employees throughout September. Then, based on the tremendous feedback, we extended the global Lunch On Us program for all employees through October. We are committed to providing a great place to work, and this is one of the many ways we're investing in our teammates.

We logged more than 8.7 billion steps in our 2022 Global Get Active! challenge

We did it! Teammates who participated in this year's four-week activity challenge took more than 8.7 billion steps, virtually reaching destinations like Dallas, Jacksonville, Charlotte, S?o Paulo, London and Hong Kong. Throughout the challenge, teammates connected with each other and engaged in friendly competition. Congratulations to our participating teammates for investing in themselves by focusing on their physical health and getting active.

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Bank of America

Delivering for our employees

In 2022, record 2,600 Bank of America new hires in the U.S. have a military background

After completing our five-year goal of hiring 10,000 military veterans ahead of schedule, we continue to actively focus on recruiting and retaining veterans who bring leadership and skills that strengthen our company. We have hired more than 2,600 individuals with a military background, which is more than 15% of all U.S. external hires as of July 2022. As a result, we've increased representation by 24% year to date.

Meeting veterans where they are

Bobby Turner, who leads our Military Talent Acquisition team, spent 21 years in the Army -- 16 of them in recruiting. With his teammate Kathleen Hunter, he works with internal and external partners to recruit and develop veterans. He says that

hiring veterans means meeting them where they are, and helping them understand that the skills they've gained in the service translate to valuable experience for a Bank of America career.

The team has increased the number of virtual hiring events for the company -- something that they began even before the global pandemic, and which has kept us ahead of competitors. They strategically plan where to hold and attend in-person events and conferences, concentrating where veterans are likely to be, including close to military bases specializing in particular skills and where there is a diverse veteran population.

The bank also invests in several military development programs, including the Global Operations Military Development Program started in 2017, the Strategy & Management Military Development Program started in 2017, the Veterans Associates Program -- Global Banking & Global Markets started in 2017, and the Global Banking & Global Markets Operations Military Development Program started in 2021. All programs have strong retention rates of 95% and above since their inception.

A successful transition to a rewarding career

"Transitioning from active service to civilian life is a critical moment for veterans and their families," says Lindsey Streeter, who leads Military Affairs for the company and spent 31 years in the Army. His team conducted a study to determine the resources most important to veterans, and developed a range of support programs, including pairing new teammates with veterans who have been with the company for longer through the Veteran Onboarding Initiative, or "Buddy Program," resulting in a participant retention rate of 95% since its inception in 2020.

The Military Affairs team is introducing a new playbook for managers and veteran teammates, and has enhanced the veteran development program, creating opportunities for rising talent to connect with senior leaders and leading to career growth for more than 50% of participants.

Announcing enhanced tools and resources to support our teammates' career mobility

One of the ways we demonstrate how we are a great place to work is by building an environment where teammates want to build a career. Our focus on providing contemporary, world-class tools and processes to support career development and internal mobility is key to enabling Responsible Growth that is sustainable.

In response to employee feedback, we're simplifying how employees can navigate their career at Bank of America and achieve their professional goals. These enhancements have already begun through The Academy at Bank of America, which expanded last year to support employee onboarding and professional development for all of our 200,000+ teammates.

Next step: Supporting our teammates' professional development and career mobility

Our goal is to make it easier to find internal job opportunities that align with our teammates' skills -- whether in their current line of business or in another group. We also want to make it easier to understand the skills required for roles teammates may want to explore in the future.

Enhancements include:

Expanding our existing training by adding the Navigating your career across

LOBs course to learn best practices for exploring roles in a new space.

Expanding availability of our talent mobility advisors, beginning in fourth quarter.

Talent mobility advisors will provide tailored guidance about jobs across the company that require similar skills.

Adding skills and refined job descriptions to the Career Path Tool, beginning in fourth

quarter. This will make it easier to identify jobs with similar skill sets along with learning

resources for teammates to achieve their career goals.

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Bank of America

Delivering for our clients

Erica? tops 1 billion client interactions in four years

Usage of our virtual financial assistant Erica?, the most advanced and first widely available virtual assistant of its kind, reaches new highs as we surpassed 1 billion interactions with clients.

"Erica is the definition of how Bank of America is delivering personalization and individualization at scale to our clients," said David Tyrie, chief digital officer and head of Global Marketing. "We expect the second billion to come even more quickly as we continue to evolve Erica's capabilities, providing clients with the shortest route to the answers they need about their financial lives."

Since its launch, Erica has expanded to include new features and functionality:

? Clients viewed 37 million proactive insights to help them review their finances and cut recurring subscription charges that may have increased unexpectedly, know when they've received a merchant refund or have duplicate charges.

? More than 4 million proactive notifications about eligibility for Preferred Rewards have helped clients enroll in the program and enjoy the benefits.

? 60 million Spend Path insights have helped clients understand their finances with a weekly snapshot of spending.

? More than 98% of clients get the answers they need using Erica. In September 2022, we launched Mobile Servicing Chat by Erica to connect clients to a live chat with a representative to answer more complex servicing questions, with more than 170,000 chats to date.

? Coming in the first half of 2023, Erica will connect clients to financial specialists when they have questions about new products and services, such as a mortgage, credit card or deposit account.

Preferred Rewards surpasses 10 million member milestone

The loyalty program's unique relationship-based

It's the reason they stay ? Preferred

approach provides members with extensive rewards 2 Rewards members have a 99% client

and benefits across their deposit accounts, investments,

retention rate and are more likely than

credit cards, mortgages and auto loans. Preferred

non-members to increase the depth and

Rewards members are currently 15% of all our clients

breadth of their relationship.

and account for 83% of all assets on deposit and

28% of investment assets. Throughout the history of the program, members have shared lots of feedback

3

Gateway to more of our product solutions ? Opening more than 1 million

about why they love the program. Here is what

new products to date this year, members

they're telling us:

typically have twice the number of

accounts with us as non-members.

In September, Preferred Rewards, our industryleading loyalty program, celebrated eight years since launch and the milestone of 10 million members across Preferred Rewards tiers for individual clients (Gold, Platinum, Platinum Honors, Diamond and Diamond Honors) and Preferred Rewards for Business. Preferred Rewards is the first no-fee program of its kind that recognizes and rewards clients for choosing to do more across their Bank of America and Merrill accounts.

The top 5 reasons our 10 million members love Preferred Rewards

High value rewards ? Members earn

1 over $3.5 billion in rewards annually,

which is an average of $500 earned per member. Plus, members of the highest tiers have access to exclusive travel and virtual experiences. In addition, Preferred Rewards for Business provides similar benefits for small business owners.

Seamless with our digital tools ?

4 Members can track their rewards with

My Rewards in our mobile app, and Erica? lets clients know when they qualify, summarizes rewards history and available rewards and how they can redeem rewards.

Rewards get better as they move up

5 program tiers ? The program's five-tier

structure increases the level of rewards and benefits as clients' qualifying banking and investment balances grow.

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Bank of America

Delivering for our clients

Merrill Advisor Match transforms the way people find a financial advisor

Research indicates there's a need for a modern approach to finding a financial advisor. Many people don't know how to search for an advisor and a third of affluent Americans are not currently working with an advisor. Merrill Advisor Match solves for this need by serving up visitors a simple set of questions. Based on their answers, they're then shown a personalized list of advisors and given the opportunity to schedule a meeting with the advisor of their choice.

"We've combined a century of bringing Wall Street to Main Street with a personalized digital experience that takes the guesswork out of finding the right advisor," said Andy Sieg, president of Merrill Wealth Management. "Merrill Advisor Match is an industry-changing innovation that reflects our modern Merrill strategy, helping to connect more investors to advice from the best advisors in the industry."

Best-in-class financial technology

The tool matches potential clients to financial advisors based on multiple dimensions, including engagement preferences, guidance style and personality traits. The intuitive questionnaire and technology, as well as the promotion of Merrill Advisor Match, are the result of a close collaboration between Merrill and Data, Digital and Global Marketing.

"Innovation is embedded in our culture, along with our commitment to and ongoing investment in best-in-class financial technology," said David Tyrie, chief digital officer and head of Global Marketing. "Advisor Match allows us to better serve new clients, delivering a personalized and modernized experience to finding an advisor online that is timely, relevant and secure."

Bank of America sets record for patents granted during first half of 2022

We recorded the most patents granted in the first half of any year in the company's history. United States Patent and Trademark Office granted Bank of America 341 patents during the first half of 2022, which is a 50% increase, year over year.

Patents granted include client-focused innovations related to security, privacy, fraud detection, payment technologies, artificial intelligence, machine learning and mobile banking. We have more U.S. patents than any other financial services company.

Bank of America patent statistics

? 5,556 patents pending or granted

? 6,500 company inventors based in 43 U.S. states and 14 countries, across all eight lines of business

? 26% of our inventors are women, while less than 17% of U.S. inventors are women

? 1,000 information security patents pending or granted, the most among financial services companies

"The diversity of our patent-winning portfolio represents the diverse experiences and unique perspectives of more than 6,500 inventors around the world," said Aditya Bhasin, chief technology and information officer. "Their desire to address client needs, safeguard client information and create new solutions that help clients build better financial lives drives our record-breaking patents streak."

Global Information Security teammate and retired Marine Corps Reservist Michael Young, a top company inventor, has filed 65 patents that span cybersecurity, artificial intelligence, data security and more.

"The bank has fostered a culture of innovation, and patents are just one way for technologists to express our creativity," he said. "While I am passionate about inventing, the best part is the opportunity to collaborate with talented teammates across the organization."

Other companies often cite our patents as influencing their efforts. So far in 2022, we have been cited by more than 2,400 patents and applications from a variety of industries, including well-known technology companies. Historically, our company has been cited more than 43,000 times.

"The diversity of our patent-winning portfolio represents the diverse experiences and unique perspectives of more than 6,500 inventors around

the world."

Aditya Bhasin, Chief Technology and Information Officer

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Bank of America

Delivering for our communities

Brian Moynihan hosts global CEOs at Sustainable Markets Initiative Summit

As co-chair of the Sustainable Markets Initiative (SMI), CEO Brian Moynihan recently welcomed more than 60 CEOs and SMI leaders to our offices for a day of updates and strategic discussions. The summit was an opportunity to build on the momentum from the previous summit meeting last May, and to connect ahead of the 2022 United Nations Climate Change Conference (COP27) in Egypt in November.

The summit reviewed progress in delivering the Terra Carta mandate by 2030, which will be driven by SMI participants made up of more than 150 global CEOs, 15 task forces and industry engagement groups, and four Country Councils, including new councils in China and Jordan.

"The SMI's mission is to build a coordinated global effort to enable the private sector to accelerate the transition to a sustainable future. Our work at the summit will assure that we continue to make advances in achieving the Terra Carta mandate and continue the mission of the SMI that His Majesty King Charles III set out when he founded the SMI in 2020," said Brian.

With New York Climate Week and the United Nations General Assembly also taking place, it was an exciting time in New York to showcase and build on the work of the SMI. Bank leaders, including Vice Chair Paul Donofrio and Global Head of Sustainable Finance Karen Fang, also participated in SMI-hosted sessions at Goals House, a forum that brings together leaders, advocates, entrepreneurs and other thinkers to reach the United Nations' Sustainable Development Goals.

Speaking to our efforts to engage our clients on net zero, Paul said, "It is something we are committed to because it is core to our purpose to help our clients achieve their financial goals and at the same time, we're helping society solve one of its biggest challenges."

We're doubling our support for Minority Depository Institutions

In October, we announced an additional $100 million in low-cost deposits to Minority Depository Institutions (MDIs), which will facilitate lending, housing, neighborhood revitalization and other banking services in minority and low- to moderate-income communities. This program will double our existing $100 million in deposits in MDIs, part of our industry-leading $2 billion portfolio of loans, deposits and investments in Community Development Financial Institutions (CDFIs) and MDIs. These low-cost deposits will help MDIs expand their lending capacity and leverage the investments made by our company and other institutions across the U.S., as well as the U.S. Department of Treasury's Emergency Capital Investment Program (ECIP). "It is well recognized that MDIs are a critical resource to minority and underserved communities by providing banking services, creating jobs and helping businesses grow," said D. Steve Boland, chief administrative officer. "As a founding member of the Economic Opportunity Coalition, we are committed to finding innovative ways to scale and expand the reach of our capital to provide access to economic opportunities and support diverse communities across the country." This builds on our longstanding work to advance racial equality and economic opportunity, including $42.5 million in equity investments to 22 MDI and CDFI banks, of which, we will acquire up to 4.9% of common equity. It also includes our commitment of $350 million to over 100 private equity funds that provide capital to minority and women entrepreneurs and small business owners. MDIs are federal insured depository institutions for which (1) 51% or more of the voting stock is owned by minority individuals; or (2) a majority of the board of directors is minority and the community that the institution serves is predominantly minority.

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