Bank of America Second Quarter Operating Earnings Rise

To a Record $2.06 Billion CHARLOTTE, N.C. (PROTEXT) - Bank of America Corporation (NYSE:BAC) today reported operating earnings of $2.06 billion, or $1.18per share ($1.15 diluted), for the second quarter of 1999, upfrom $2.02 billion, or $1.16 per share ($1.13 diluted), a yearearlier. The company's return on common equity was 17.64 percentand the return on average assets was 1.34 percent. Operatingearnings increased 8 percent from the first quarter of 1999. After a merger-related charge of $145 million after taxes, netincome in the latest quarter was $1.92 billion, or $1.10 pershare ($1.07 diluted). In the second quarter of 1998, a $277million after-tax gain on the sale of Florida branches broughtnet income to $2.30 billion, or $1.32 per share ($1.28 diluted). Cash operating earnings -- which exclude the amortization ofintangibles -- were $2.28 billion, or $1.31 per share ($1.28diluted). The return on tangible equity was 28.49 percent. A yearearlier, cash operating earnings were $2.25 billion, or $1.29 pershare ($1.25 diluted). "Bank of America continues to make significant progress towardour goals, as reflected in our successful merger integrationefforts, solid core operating results and many new initiativesaimed at improving and expanding customer relationships," saidHugh L. McColl Jr., chairman and chief executive officer. For the first six months of 1999, operating earnings were$3.97 billion and net income was $3.83 billion. Operatingearnings per share were $2.28 ($2.23 diluted) and reportedearnings per share were $2.20 per share ($2.15 diluted). A yearago, operating income was $3.99 billion, or $2.30 per share($2.23 diluted). For the first six months of 1998, net income was$3.63 billion, or $2.09 per share ($2.03 diluted). Second Quarter Earnings Highlights (compared to a year ago) The efficiency ratio improved nearly 300 basis points to 54percent, led by a 7 percent decline in expenses. Average managed loans increased 11 percent, driven by a 16percent increase in managed consumer loans and a 6 percentincrease in managed commercial loans. Fee-based revenue was generally strong. Credit card anddeposit fee income was up significantly while investment banking,although below last year's record, also had a strong performance. Net Interest Income Fully taxable-equivalent net interest income of $4.66 billionwas essentially unchanged from a year earlier, as the impact ofloan and deposit growth was mostly offset by the effects of assetsecuritizations, divestitures, loan sales and a higher level oflower-yielding securities. Average managed loans grew 11 percentto $389 billion, reflecting increases in both consumer andcommercial loans. The net yield on earning assets declined by 27basis points to 3.53 percent. Noninterest Income Noninterest income declined 3 percent to $3.52 billion, asgains in trading, credit card, brokerage, asset management anddeposit fee revenues were offset by lower mortgage bankingincome, investment banking revenue and other income. Thereduction in investment banking revenue resulted in part from thesale of one of the company's investment banking units in thesecond half of 1998. A year ago, other income included a gain onthe sale of the Columbia Seafirst Center. Securities gains were $52 million compared to $120 million inthe second quarter of 1998. Efficiency Noninterest expense was reduced by 7 percent to $4.46 billion,reflecting cost savings resulting from recent mergers somewhatoffset by continued spending on merger transition projects.Personnel expense dropped by 7 percent, and other operatingexpenses were also reduced. The efficiency ratio was 54 percent,a significant improvement from 57 percent a year earlier. Credit Quality The provision for credit losses in the second quarter was $510million, compared to $495 million a year earlier. Net charge-offswere $520 million versus $505 million a year ago. Net charge-offsrepresented .57 percent of loans and leases, a 2-basis-pointimprovement from a year ago. Nonperforming assets were $3.07 billion, or .84 percent ofloans, leases and foreclosed properties on June 30, 1999,compared to $2.53 billion, or .73 percent a year earlier. Theallowance for credit losses totaled $7.10 billion on June 30,1999, equal to 252 percent of nonperforming loans and 1.95percent of loans and leases. The allowance was $6.73 billion, or300 percent of nonperforming loans and 1.95 percent of loans andleases, a year earlier. Capital Strength Shareholders' equity stood at $45.6 billion at June 30, 1999.Total capital was equal to 8.24% of assets. The company's marketcapitalization was $126 billion. On June 23, the companyauthorized the repurchase of up to 130 million common shares over24 months, with an expectation to complete the program within 18months. Through June 30, the company had purchased 25 millionshares. Business Segment Results Consumer Banking, which serves individuals and smallbusinesses, earned $979 million, while Commercial Banking, whichserves companies with from $10 million to $500 million inrevenue, earned $220 million. Together, they represented 58percent of the company's operating income. Global Corporate andInvestment Banking, which serves large corporate customers,earned $581 million, representing 28 percent of the company'searnings. Principal Investing and Asset Management, whichencompasses the private bank, trust, investment management,mutual funds, retail brokerage and principal investing, earned$184 million, representing 9 percent. Bank of America, with $614 billion in assets, is the largestbank in the United States. The company serves more than 30million households and 2 million businesses across the country,offering customers the largest and most convenient deliverynetwork from offices and ATMs to telephone and internet access.It also provides comprehensive international corporate financialservices for clients doing business around the world. The companycreates financial relationships featuring a full array offinancial services, from traditional banking products toinvestments and capital raising within the securities markets.Bank of America stock (ticker: BAC) is listed on the New York,Pacific and London stock exchanges and certain shares are listedon the Tokyo Stock Exchange. Further investor information can befound at www.bankofamerica.com/investor . www.bankofamerica.com Bank of America Corporation

Three Months

SIXMonths

Ended JUNE 30

Ended JUNE30

1999

1998

19991998 Financial Summary (In millions, except per-share data) Operating net income

$2,060

$2,021

$3,974$3,994 Operating earnings

per common share

1.18

1.16

2.282.30 Diluted operating earnings

per common share

1.15

1.13

2.232.23 Cash basis earnings (1)

2,285

2,248

4,4214,449 Cash basis earnings per

common share

1.31

1.29

2.542.56 Cash basis diluted earnings

per common share

1.28

1.25

2.482.49 Dividends paid per common share .45

.38

.90.76 Price per share of common stock

at period end

73.31

76.69

73.3176.69 Average common shares 1,743.503 1,732.168 1,740.5491,728.35 Average diluted common shares

1,786.844 1,784.712 1,783.3161,778.947 Summary Income Statement (Operating Basis) (Taxable-equivalent in millions) Net interest income

$4,663

$4,668

$9,308$9,327 Provision for credit losses

(510)

(495)(1,020)(1,005) Gains on sales of securities

52

120

182333 Noninterest income

3,522

3,636

6,7457,129 Other noninterest expense

(4,457)

(4,767)(8,910)(9,471) Income before income taxes

3,270

3,162

6,3056,313 Income taxes - including FTE adjustment

1,210

1,141

2,3312,319 Operating net income

$2,060

$2,021

$3,974$3,994 SUMMARY Balance Sheet (Average balances in billions) Loans and leases

$364.753

$342.787 $362.760$342.381 Managed loans and leases(2)

389.373

351.321

387.164349.297 Securities

77.855

63.052

76.84864.412 Earning assets

530.049

491.945

526.884492.878 Total assets

615.364

573.975

612.510576.394 Deposits

342.249

342.369

344.080341.125 Shareholders' equity

46.891

44.857

46.58744.246 Common shareholders' equity 46.821

44.198

46.51643.579 PERFORMANCE INDICES (Operating Basis) Return on average common shareholders' equity

17.64%

18.24%

17.22%18.38% Return on average tangible common shareholders' equity 28.49

31.23

27.9731.88 Return on average assets

1.34

1.41

1.311.40 Return on average tangible assets

1.53

1.61

1.491.60 Net interest yield

3.53

3.80

3.553.81 Efficiency ratio

54.44

57.38

55.4957.55 Cash basis efficiency ratio 51.70

54.65

52.7154.79 Net charge-offs (in millions $520

$505

$1,039$1,021 % of average loans and leases .57%

.59%

.58%.60% Managed bankcard net charge-offs as a % of average managed bankcard receivables

6.13

6.52

6.076.65 REPORTED RESULTS (Including Merger-Related Charges) (In millions, except per-share data) Net income

$1,915

$2,298

$3,829$3,629 Earnings per common share

1.10

1.32

2.202.09 Diluted earnings

per common share

1.07

1.28

2.152.03 Return on average common shareholders' equity

16.40

20.76

16.5916.69 (1) Cash basis earnings equal operating net income excluding

amortization of intangibles. (2) Prior periods are restated for comparison (e.g.acquisitions,

divestitures and securitizations). (3) Ratios and amounts for 1998 have not been restated toreflect

the impact of the BankAmerica merger.

JUNE 30

1999

1998 Balance Sheet highlights (In billions, except per-share data) Loans and leases

$363.581$344.358 Securities

76.51160.853 Earning assets

528.797486.339 Total assets

614.102571.890 Deposits

339.045347.877 Shareholders' equity

45.63146.709 Common shareholders' equity

45.55146.646 Per share

26.4426.88 Total equity to assets ratio (period-end)

7.43%8.17% Risk-based capital(3) Tier 1 capital ratio

7.38%7.32% Total capital ratio

11.0911.77 Leverage ratio(3)

6.346.21 Common shares issued and outstanding (in millions)

1,722.9311,735.233 Allowance for credit losses

$7.096$6.731 Allowance for credit losses as a % of loans and leases

1.95%1.95% Allowance for credit losses as a % of nonperforming loans

252.38299.98 Nonperforming loans

$2.812$2.244 Nonperforming assets

3.0702.526 Nonperforming assets as a % of: Total assets

.50%.44% Loans, leases and foreclosed properties

.84.73 OTHER DATA Full-time equivalent headcount

161,919178,729 Banking centers

4,5314,866 ATMs

14,05114,691 BUSINESS SEGMENT RESULTS - Three months ended June 30, 1999 (In millions)

OPERATING

AVERAGERETURN ON

TOTAL

NET

LOANSAVERAGE

REVENUE

INCOME

AND LEASESEQUITY Consumer Banking

$4,547

$979

$183,85320% Commercial Banking

766

220

55,35019 Global Corporate and

Investment Banking

2,133

581

107,27819 Principal Investing and Asset Management

634

184

18,86425 Additional financial information for investors can be found at http://www.bankofamerica.com/newsroom/press/images/2q99fact.pdf ots Original Text Service: Bank of America CorporationInternet: http://www.newsaktuell.de Contact: investors, SusanCarr, 704-386-8059, or Kevin Stitt, 704-386-5667, or media, BobStickler or Rick Beebe, 704-386-8465, all of Bank of AmericaCorporation Web site: http://www.bankofamerica.com

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