Bank of America 2005 Annual Report Download - page 74

Trading-related revenue and equity commissions, both key measures reviewed by management, are presented in the
following table.
Trading-related Revenue and Equity Commissions
(Dollars in millions) 2005 2004
Trading-related net interest income(1) ................................................ $1,444 $2,039
Trading account profits(2) ........................................................... 1,664 1,023
Total trading-related revenue(2) ............................................... 3,108 3,062
Equity commissions(1,3) ............................................................. 794 667
Total trading-related revenue and equity commissions .................... $3,902 $3,729
Trading-related Revenue by Product and Equity Commissions
Fixedincome...................................................................... $1,054 $1,547
Interest rate(1) ..................................................................... 767 667
Foreign exchange .................................................................. 744 752
Equities and equity commissions(1) ................................................... 1,201 862
Commodities ...................................................................... 87 45
Market-based trading-related revenue and equity commissions ................ 3,853 3,873
Credit portfolio hedges(4) ............................................................ 49 (144)
Total trading-related revenue and equity commissions(2) ................... $3,902 $3,729
(1) FTE basis
(2) Total corporate Trading Account Profits were $1,812 million and $869 million in 2005 and 2004. Total corporate trading-related
revenue was $3,256 million and $2,908 million in 2005 and 2004.
(3) Equity commissions are included in Investment and Brokerage Services in the Consolidated Statement of Income.
(4) Includes CDS and related products used for credit risk management. For additional information on CDS, see Concentrations of
Commercial Credit Risk beginning on page 53.
In 2005, market-based trading-related revenue was $3.9 billion, relatively unchanged from the prior year. Fixed
income revenue decreased $493 million due to increased spread volatility in certain industries and lack of investor
demand. Offsetting this decline were increases in equities and equity commissions, interest rate-related revenues and
commodities. Trading-related revenue from equities and equity commissions increased $339 million due to higher
customer activity and the absence of net losses on a stock position that occurred in 2004. Interest rate-related revenues
increased $100 million primarily related to higher sales activity. In 2005, commodities revenue increased $42 million as
the prior year included losses related to positions in gas and jet fuel.
Total trading-related revenue and equity commissions included net gains of $49 million associated with credit
portfolio hedges, an improvement of $193 million from 2004. The improvement was primarily due to widening of spreads
on CDS in certain industries.
The following table presents the detail of Investment Banking Income within the segment.
Investment Banking Income
(Dollars in millions) 2005 2004
Securities underwriting .................................................... $ 787 $ 920
Syndications .............................................................. 528 521
Advisory services .......................................................... 409 310
Other.................................................................... 25 32
Total investment banking income(1) .................................. $1,749 $1,783
(1) Investment Banking Income recorded in other business units in 2005 and 2004 was $107 million and $103 million.
Investment Banking Income decreased $34 million, or two percent, in 2005. The decrease was due primarily to a
decline in securities underwriting as the overall market contracted and private placement activity declined. This decline
was partially offset by market share gains in certain debt issuance markets and higher advisory services income due to
increased merger and advisory activity.
Global Wealth and Investment Management
This segment provides tailored investment services to individual and institutional clients in various stages and
economic cycles. Our clients are offered specific products and services based on their needs through five major
businesses: Premier Banking and Investments (PB&I), The Private Bank, Family Wealth Advisors (FWA), Columbia
Management Group (Columbia) and Other Services.
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