BANK OF AMERICA
Does Not Affect Bank of America Corporation’s Consolidated Financial Results or Capital Position
CHARLOTTE, N.C.--(BUSINESS WIRE)--In a move that does not affect Bank of America Corporation’s current or previously reported consolidated financial results and capital positions, the company has amended previously filed call reports for 2009 and 2010 for its FIA Card Services, N.A. (FIA) subsidiary. FIA is the legal entity that includes Bank of America’s credit card operations.
The restatement, which resulted from changes to processes covering legal entities implemented in 2010, covers eight quarterly periods of 2009 and 2010, and is in call reports filed with the Office of the Comptroller of the Currency and the FDIC this month.
The restatement involves a non-cash, non-tax deductible charge related to a $20.3 billion goodwill impairment at FIA, which has now been recorded for that legal entity for the first half of 2009. The goodwill writedown was caused by deteriorating credit quality and the adverse impact from The CARD Act on Bank of America’s credit card operations in 2009. Included in the amended call reports was the reversal of a $10.4 billion writedown of goodwill taken at FIA during 2010.
FIA’s credit card operations are part of Global Card Services, the business segment which also includes among other activities, the debit card business of Bank of America. In connection with the preparation of its consolidated financial statements, Bank of America periodically conducts a test of the carrying value of the goodwill assigned to each of its business segments, including Global Card Services. Through 2009 and the first half of 2010, the test indicated no goodwill impairment in that segment. As a result, under generally accepted accounting principles (GAAP), the adjustments to the accounts of FIA described above had no impact on the consolidated results of operations or the financial position of Bank of America Corporation.
In the wake of Dodd-Frank financial reform legislation last summer, which placed significant limits on debit card revenues, Bank of America recorded a $10.4 billion impairment in the carrying value of the goodwill of Global Card Services in the third quarter of 2010 as previously reported.
The non-cash charges had no impact on the regulatory capital ratios of FIA or Bank of America. The FIA adjustment was identified by Bank of America and reported to banking regulators.
Bank of America
Bank of America is one of the world's largest financial institutions, serving individual consumers, small- and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 57 million consumer and small business relationships with more than 5,800 retail banking offices and approximately 18,000 ATMs and award-winning online banking with 29 million active users. Bank of America is among the world's leading wealth management companies and is a global leader in corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to approximately 4 million small business owners through a suite of innovative, easy-to-use online products and services. The company serves clients through operations in more than 40 countries. Bank of America Corporation stock (NYSE: BAC) is a component of the Dow Jones Industrial Average and is listed on the New York Stock Exchange.
Investors May Contact:
Kevin Stitt, Bank of America, 1.704.386.5667
Lee McEntire, Bank of America, 1.704.388.6780
Reporters May Contact:
Bob Stickler, Bank of America, 1.980.386.8465