Bank of America 2015 Annual Report Download - page 196

194 Bank of America 2015
security. In both cases, the Corporation or a subsidiary may be
required to settle the obligation for cash or other securities prior
to the contractual maturity date. These borrowings are reflected
in the table as maturing at their contractual maturity date.
During 2015, the Corporation had total long-term debt
maturities and redemptions in the aggregate of $40.4 billion
consisting of $25.3 billion for Bank of America Corporation, $6.6
billion for Bank of America, N.A. and $8.5 billion of other debt.
During 2014, the Corporation had total long-term debt maturities
and redemptions in the aggregate of $53.7 billion consisting of
$33.9 billion for Bank of America Corporation, $8.9 billion for Bank
of America, N.A. and $10.9 billion of other debt.
Long-term Debt by Maturity
(Dollars in millions) 2016 2017 2018 2019 2020 Thereafter Total
Bank of America Corporation
Senior notes $ 16,777 $ 18,303 $ 20,211 $ 16,820 $ 11,351 $ 40,299 $ 123,761
Senior structured notes 4,230 2,352 1,942 1,374 955 6,695 17,548
Subordinated notes 4,861 4,885 2,677 1,479 3 18,340 32,245
Junior subordinated notes — — — — — 5,848 5,848
Total Bank of America Corporation 25,868 25,540 24,830 19,673 12,309 71,182 179,402
Bank of America, N.A.
Senior notes 3,048 3,648 5,709 — — 20 12,425
Subordinated notes 1,056 3,447 — 1 — 1,712 6,216
Advances from Federal Home Loan Banks 6,003 10 10 15 12 122 6,172
Securitizations and other Bank VIEs (1) 1,290 3,550 2,300 2,450 — 166 9,756
Other 53 2,713 76 85 30 28 2,985
Total Bank of America, N.A. 11,450 13,368 8,095 2,551 42 2,048 37,554
Other debt
Senior notes — 1 — — — 29 30
Structured liabilities 3,110 2,029 1,175 882 1,034 6,744 14,974
Nonbank VIEs (1) 2,506 240 42 22 — 1,507 4,317
Other 400 57 — — — 30 487
Total other debt 6,016 2,327 1,217 904 1,034 8,310 19,808
Total long-term debt $ 43,334 $ 41,235 $ 34,142 $ 23,128 $ 13,385 $ 81,540 $ 236,764
(1) Represents the total long-term debt included in the liabilities of consolidated VIEs on the Consolidated Balance Sheet.
Trust Preferred and Hybrid Securities
Trust preferred securities (Trust Securities) are primarily issued by
trust companies (the Trusts) that are not consolidated. These Trust
Securities are mandatorily redeemable preferred security
obligations of the Trusts. The sole assets of the Trusts generally
are junior subordinated deferrable interest notes of the
Corporation or its subsidiaries (the Notes). The Trusts generally
are 100 percent-owned finance subsidiaries of the Corporation.
Obligations associated with the Notes are included in the long-
term debt table on page 193.
Certain of the Trust Securities were issued at a discount and
may be redeemed prior to maturity at the option of the Corporation.
The Trusts generally have invested the proceeds of such Trust
Securities in the Notes. Each issue of the Notes has an interest
rate equal to the corresponding Trust Securities distribution rate.
The Corporation has the right to defer payment of interest on the
Notes at any time or from time to time for a period not exceeding
five years provided that no extension period may extend beyond
the stated maturity of the relevant Notes. During any such
extension period, distributions on the Trust Securities will also be
deferred and the Corporation’s ability to pay dividends on its
common and preferred stock will be restricted.
The Trust Securities generally are subject to mandatory
redemption upon repayment of the related Notes at their stated
maturity dates or their earlier redemption at a redemption price
equal to their liquidation amount plus accrued distributions to the
date fixed for redemption and the premium, if any, paid by the
Corporation upon concurrent repayment of the related Notes.
Periodic cash payments and payments upon liquidation or
redemption with respect to Trust Securities are guaranteed by the
Corporation or its subsidiaries to the extent of funds held by the
Trusts (the Preferred Securities Guarantee). The Preferred
Securities Guarantee, when taken together with the Corporation’s
other obligations including its obligations under the Notes,
generally will constitute a full and unconditional guarantee, on a
subordinated basis, by the Corporation of payments due on the
Trust Securities.
On December 29, 2015, the Corporation provided notice of the
redemption, which settled on January 29, 2016, of all trust
preferred securities of Merrill Lynch Preferred Capital Trust III,
Merrill Lynch Preferred Capital Trust IV and Merrill Lynch Preferred
Capital Trust V with a total carrying value in the aggregate of $2.0
billion. In connection with the Corporation’s acquisition of Merrill
Lynch & Co., Inc. (Merrill Lynch) in 2009, the Corporation recorded
a discount to par value as purchase accounting adjustments
associated with these Trust Preferred Securities. The Corporation
recorded a charge to net interest income of $612 million in 2015
related to the discount on the securities.