BANK OF AMERICA CORP DE

Global Markets offers sales and trading services and research services to institutional clients across fixed-income, credit, currency, commodity and equity businesses. Global Markets product coverage includes securities and derivative products in both the primary and secondary markets. For more information about Global Markets, see Business Segment Operations in the MD&A of the Corporation’s 2023 Annual Report on Form 10-K.

The following explanations for period-over-period changes in results for Global Markets, including those disclosed under Sales and Trading Revenue, are the same for amounts including and excluding net DVA. Amounts excluding net DVA are a non-GAAP financial measure. For more information on net DVA, see Supplemental Financial Data on page 6.

Net income for Global Markets increased $300 million to $1.5 billion for the three months ended September 30, 2024 compared to the same period in 2023. Net DVA losses totaled $8 million compared to $16 million in 2023. Excluding net DVA, net income increased $294 million to $1.6 billion. These increases were primarily driven by higher revenue, partially offset by higher noninterest expense.

Revenue increased $688 million to $5.6 billion primarily due to higher sales and trading revenue and investment banking fees. Sales and trading revenue increased $525 million, and excluding net DVA, increased $517 million. These increases were driven by higher revenue in both Equities and FICC.

Noninterest expense increased $208 million to $3.4 billion, primarily driven by revenue-related expenses and continued investments in the business, including technology.

Average total assets increased $60.4 billion to $924.1 billion for the three months ended September 30, 2024 compared to the same period in 2023 driven by increased securities financing activity, higher levels of inventory and loan growth.

The return on average allocated capital was 14 percent, up from 11 percent in the same period a year ago, reflecting higher net income. For information on capital allocated to the business segments, see Business Segment Operations on page 10.

Net income for Global Markets increased $639 million to $4.7 billion for the nine months ended September 30, 2024 compared to the same period in 2023. Net DVA losses were $94 million compared to $104 million in 2023. Excluding net DVA, net income increased $631 million to $4.8 billion. These increases were primarily driven by higher revenue, partially offset by higher noninterest expense.

Revenue increased $1.5 billion to $17.0 billion primarily due to the same factors as described in the three-month discussion. Sales and trading revenue increased $944 million, and excluding net DVA, sales and trading revenue increased $934 million. These increases were driven by the same factors as described in the three-month discussion.

Noninterest expense increased $486 million to $10.4 billion, driven by the same factors as described in the three-month discussion.

Average total assets increased $39.0 billion to $909.4 billion, and period-end total assets increased $140.6 billion from December 31, 2023 to $958.2 billion. The increases were driven by the same factors as described in the three-month discussion.

The return on average allocated capital was 14 percent, up from 12 percent in the same period a year ago, reflecting higher net income.

Sales and Trading Revenue

For a description of sales and trading revenue, see Business Segment Operations in the MD&A of the Corporation’s 2023 Annual Report on Form 10-K. The following table and related discussion present sales and trading revenue, substantially all of which is in Global Markets, with the remainder in Global Banking. In addition, the following table and related discussion also present sales and trading revenue, excluding net DVA, which is a non-GAAP financial measure. For more information on net DVA, see Supplemental Financial Data on page 6.

(1)For more information on sales and trading revenue, see Note 3 – Derivatives to the Consolidated Financial Statements.

(2)Includes FTE adjustments of $262 million and $553 million for the three and nine months ended September 30, 2024 compared to $109 million and $285 million for the same periods in 2023.

(3)Includes Global Banking sales and trading revenue of $165 million and $495 million for the three and nine months ended September 30, 2024 compared to $133 million and $464 million for the same periods in 2023.

(4)FICC and Equities sales and trading revenue, excluding net DVA, is a non-GAAP financial measure. FICC net DVA gains (losses) were $(8) million and $(79) million for the three and nine months ended September 30, 2024 compared to $(13) million and $(99) million for the same periods in 2023. Equities net DVA gains (losses) were $0 and $(15) million for the three and nine months ended September 30, 2024 compared to $(3) million and $(5) million for the same periods in 2023.

19 Bank of America

Including and excluding net DVA, FICC revenue increased $224 million and $219 million for the three months ended September 30, 2024 compared to the same period in 2023. The increases were driven by improved client activity and trading performance in foreign exchange and interest rate products. Including and excluding net DVA, Equities revenue increased $301 million and $298 million driven by strong client activity and trading performance in cash and derivatives.

Including and excluding net DVA, FICC revenue increased $90 million and $70 million for the nine months ended September 30, 2024 compared to the same period in 2023 driven by improved trading in mortgages, partially offset by a weaker trading environment for interest rate products. Including and excluding net DVA, Equities revenue increased $854 million and $864 million driven by the same factors as described in the three-month discussion.