Bank of America 2014 Annual Report Download - page 210

208 Bank of America 2014
NOTE 11 Long-term Debt
Long-term debt consists of borrowings having an original maturity of one year or more. The table below presents the balance of long-
term debt at December 31, 2014 and 2013, and the related contractual rates and maturity dates as of December 31, 2014.
December 31
(Dollars in millions) 2014 2013
Notes issued by Bank of America Corporation
Senior notes:
Fixed, with a weighted-average rate of 4.67%, ranging from 1.25% to 8.83%, due 2015 to 2044 $ 113,069 $ 109,845
Floating, with a weighted-average rate of 1.32%, ranging from 0.09% to 4.98%, due 2015 to 2044 14,559 22,268
Senior structured notes 22,168 30,575
Subordinated notes:
Fixed, with a weighted-average rate of 4.91%, ranging from 0.80% to 10.20%, due 2015 to 2038 26,995 22,379
Floating, with a weighted-average rate of 0.97%, ranging from 0.01% to 3.16%, due 2016 to 2026 1,705 1,798
Junior subordinated notes (related to trust preferred securities):
Fixed, with a weighted-average rate of 6.78%, ranging from 5.25% to 8.05%, due 2027 to perpetual 6,722 6,685
Floating, with a weighted-average rate of 0.92%, ranging from 0.78% to 1.24%, due 2027 to 2056 553 553
Total notes issued by Bank of America Corporation 185,771 194,103
Notes issued by Bank of America, N.A. (1)
Senior notes:
Fixed, with a weighted-average rate of 1.98%, ranging from 0.08% to 7.72%, due 2015 to 2187 2,893 1,670
Floating, with a weighted-average rate of 0.60%, ranging from 0.36% to 0.70%, due 2015 to 2041 5,686 3,684
Subordinated notes:
Fixed, with a weighted-average rate of 5.68%, ranging from 5.30% to 6.10%, due 2016 to 2036 4,921 4,876
Floating, with a weighted-average rate of 0.53%, ranging from 0.26% to 0.54%, due 2016 to 2019 1,401 1,401
Advances from Federal Home Loan Banks:
Fixed, with a weighted-average rate of 5.34%, ranging from 0.01% to 7.72%, due 2015 to 2034 183 1,441
Floating, with a weighted-average rate of 0.26%, ranging from 0.24% to 0.30%, due 2015 to 2016 10,500 3,001
Securitizations and other BANA VIEs 9,882 13,367
Total notes issued by Bank of America, N.A. 35,466 29,440
Other debt
Senior notes:
Fixed, with a rate of 5.50%, due 2017 to 2021 1194
Floating, with a rate of 1.88%, due 2015 21 115
Structured liabilities 15,971 16,913
Junior subordinated notes (related to trust preferred securities):
Fixed, with a weighted-average rate of 7.14%, ranging from 7.00% to 7.28%, perpetual 339 340
Floating, with a rate of 0.86%, due 2027 66 66
Nonbank VIEs 3,425 6,081
Other 2,079 2,422
Total other debt 21,902 26,131
Total long-term debt $ 243,139 $ 249,674
(1) On October 1, 2014, FIA Card Services, N.A. was merged into Bank of America, N.A.
Bank of America Corporation and Bank of America, N.A.
maintain various U.S. and non-U.S. debt programs to offer both
senior and subordinated notes. The notes may be denominated
in U.S. Dollars or foreign currencies. At December 31, 2014 and
2013, the amount of foreign currency-denominated debt translated
into U.S. Dollars included in total long-term debt was $51.9 billion
and $73.4 billion. Foreign currency contracts may be used to
convert certain foreign currency-denominated debt into U.S.
Dollars.
At December 31, 2014, long-term debt of consolidated VIEs in
the table above included debt of credit card, home equity and all
other VIEs of $8.4 billion, $1.1 billion and $3.8 billion, respectively.
Long-term debt of VIEs is collateralized by the assets of the VIEs.
For additional information, see Note 6 – Securitizations and Other
Variable Interest Entities.
The weighted-average effective interest rates for total long-term
debt (excluding senior structured notes), total fixed-rate debt and
total floating-rate debt were 4.06 percent, 4.65 percent and 0.84
percent, respectively, at December 31, 2014 and 4.37 percent,
5.14 percent and 0.92 percent, respectively, at December 31,
2013. The Corporation’s ALM activities maintain an overall interest
rate risk management strategy that incorporates the use of
interest rate contracts to manage fluctuations in earnings that are
caused by interest rate volatility. The Corporation’s goal is to
manage interest rate sensitivity so that movements in interest
rates do not significantly adversely affect earnings and capital.
The weighted-average rates are the contractual interest rates on
the debt and do not reflect the impacts of derivative transactions.
Certain senior structured notes are accounted for under the
fair value option. For more information on these senior structured
notes, see Note 21 – Fair Value Option.
The table below shows the carrying value for aggregate annual
contractual maturities of long-term debt as of December 31, 2014.
Included in the table are certain structured notes issued by the
Corporation that contain provisions whereby the borrowings are
redeemable at the option of the holder (put options) at specified
dates prior to maturity. Other structured notes have coupon or
repayment terms linked to the performance of debt or equity
securities, indices, currencies or commodities, and the maturity
may be accelerated based on the value of a referenced index or