Bank of America 2008 Annual Report Download - page 7

to build a more stable home lending
industry. We are leading the industry
by creating new programs to mitigate
foreclosures for homeowners under
financial stress. Our decision to
acquire Countrywide also has put us
in a great position to capitalize on the
surge in this business, as low inter-
est rates bring borrowers back into
the market for home purchases and
refinancings, and we are expanding our
capacity to process new applications.
All this activity is leading us toward
an anticipated Customer Day One in
late April, when we’ll begin rebranding
all Countrywide operations as Bank
of America Home Loans. In time, the
housing market will come back, and
I believe we will benefit greatly from
being a leading home loan provider
in the country when it does.
The businesses that came to us as
part of Merrill Lynch are fighting through
a very tough environment now. But we
can’t lose sight of their underlying power.
Merrill Lynch’s wealth management
business is the best in the world. It has
consistently outperformed its peers
in revenue per financial advisor and
assets managed per advisor. Combin-
ing Merrill’s productive capacity and
industry-leading practices with our
traditional banking capabilities and
distribution network will make us a
very strong competitor in this market.
We now serve more than 4 million
individual and institutional clients
all over the world, and manage more
than $1.8 trillion in total client assets
through more than 18,000 financial
advisors. We will work to expand
relationships on the wealth manage-
ment side by offering the convenience
and quality of our traditional banking
services. And we will offer our banking
customers the best wealth manage-
ment platform in the world. Nothing
that has happened in the past six
months diminishes this opportunity.
The investment banking business
is obviously under a lot of strain. And
it is likely that many of the markets
for complex structured asset-backed
products will not come back in the
foreseeable future. But we are focused
on serving the capital raising and invest-
ment banking needs of our commercial
and corporate clients, and we are
well-positioned to do so.
Our combined business serves
99 percent of the U.S. Fortune 500
and 83 percent of the Fortune Global
500. We now approach the market as
an undisputed global leader in whole-
sale financial services, providing
clients with lending, deposits, cash
management, group banking, wealth
management, debt and equity capital
raising, syndications, mergers &
acquisitions advisory services, risk
of the TARP investment — a total of just
over $400 million — on February 17.
We believe that by accepting these
investments, we should have the capi-
tal and liquidity we need to absorb
Merrill’s balance sheet and main-
tain our capital strength through the
recession. The downside is that these
obligations create a significant drag
on earnings as we work to pay the
government’s investment back, which
we intend to do as soon as possible.
Countrywide and Merrill Lynch
We made two major acquisitions in
the past 12 months that we believe
will produce positive results for our
company over time.
We agreed to acquire Countrywide
in January of last year. We knew that
we were heading into a difficult eco-
nomic period in which home mortgages
would be at the center of an intense
economic storm. We also knew that
acquiring Countrywide would give us
the best mortgage technology platform
in the business; thousands of capable
and experienced associates; and a
leading market position in the United
States in home lending — the founda-
tional financial product for millions of
American families in the most prosper-
ous country in the world.
The mortgage market needs to be
reformed, and we are leading the effort
We are building a global fi nancial
services company that offers our customers
and clients unmatched convenience and
expertise, high-quality service and a variety
of fi nancial products and services delivered
as a single relationship.
Bank of America 2008 5