XML 37 R18.htm IDEA: XBRL DOCUMENT v3.5.0.2
Long-term Debt
12 Months Ended
Dec. 31, 2015
Debt Disclosure [Abstract]  
Long-term Debt
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, 2015 and 2014, and the related contractual rates and maturity dates as of December 31, 2015.
 
 
 
 
 
December 31
(Dollars in millions)
2015
 
2014
Notes issued by Bank of America Corporation
 

 
 

Senior notes:
 

 
 

Fixed, with a weighted-average rate of 4.55%, ranging from 1.25% to 8.40%, due 2016 to 2045
$
109,861

 
$
113,037

Floating, with a weighted-average rate of 1.38%, ranging from 0.11% to 5.07%, due 2016 to 2044
13,900

 
14,590

Senior structured notes
17,548

 
22,168

Subordinated notes:
 

 
 

Fixed, with a weighted-average rate of 5.19%, ranging from 2.40% to 8.57%, due 2016 to 2045
27,216

 
23,246

Floating, with a weighted-average rate of 0.94%, ranging from 0.43% to 2.68%, due 2016 to 2026
5,029

 
5,455

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 2067
5,295

 
6,722

Floating, with a weighted-average rate of 1.08%, ranging from 0.87% to 1.53%, due 2027 to 2056
553

 
553

Total notes issued by Bank of America Corporation
179,402

 
185,771

Notes issued by Bank of America, N.A.
 

 
 

Senior notes:
 

 
 

Fixed, with a weighted-average rate of 1.57%, ranging from 1.13% to 2.05%, due 2016 to 2018
7,483

 
2,740

Floating, with a weighted-average rate of 1.13%, ranging from 0.43% to 3.30%, due 2016 to 2041
4,942

 
3,028

Subordinated notes:
 

 
 

Fixed, with a weighted-average rate of 5.68%, ranging from 5.30% to 6.10%, due 2016 to 2036
4,815

 
4,921

Floating, with a weighted-average rate of 0.80%, ranging from 0.79% to 0.81%, 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 2016 to 2034
172

 
183

Floating, with a weighted-average rate of 0.41%, ranging from 0.35% to 0.63%, due 2016
6,000

 
10,500

Securitizations and other BANA VIEs
9,756

 
9,882

Other
2,985

 
2,811

Total notes issued by Bank of America, N.A.
37,554

 
35,466

Other debt
 

 
 

Senior notes:
 
 
 
Fixed, with a rate of 5.50%, due 2017 to 2021
30

 
1

Floating

 
21

Structured liabilities
14,974

 
15,971

Junior subordinated notes (related to trust preferred securities):
 
 
 
Fixed

 
340

Floating

 
66

Nonbank VIEs
4,317

 
3,425

Other
487

 
2,078

Total other debt
19,808

 
21,902

Total long-term debt
$
236,764

 
$
243,139


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, 2015 and 2014, the amount of foreign currency-denominated debt translated into U.S. Dollars included in total long-term debt was $46.4 billion and $51.9 billion. Foreign currency contracts may be used to convert certain foreign currency-denominated debt into U.S. Dollars.
At December 31, 2015, long-term debt of consolidated VIEs in the table above included debt of credit card, home equity and all other VIEs of $9.6 billion, $183 million and $4.3 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 3.80 percent, 4.61 percent and 0.96 percent, respectively, at December 31, 2015 and 3.81 percent, 4.83 percent and 0.80 percent, respectively, at December 31, 2014. 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 and structured liabilities are accounted for under the fair value option. For more information on these 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, 2015. 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 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 66.
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.

The Trust Securities Summary table details the outstanding Trust Securities and the related Notes previously issued which remained outstanding at December 31, 2015.
 
 
 
 
 
 
 
 
 
 
 
 
Trust Securities Summary
 
 
 
 
 
 
 
 
(Dollars in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2015
 
 
 
 
 
 
Issuer
Issuance Date
 
Aggregate
Principal
Amount
of Trust
Securities
 
Aggregate
Principal
Amount
of the
Notes
Stated Maturity
of the Trust Securities
Per Annum Interest
Rate of the Notes
 
Interest Payment
Dates
 
Redemption Period
Bank of America
 
 
 

 
 

 
 

 
 
 
 
Capital Trust VI
March 2005
 
$
27

 
$
27

March 2035
5.63
%
 
Semi-Annual
 
Any time
Capital Trust VII (1)
August 2005
 
6

 
7

August 2035
5.25

 
Semi-Annual
 
Any time
Capital Trust VIII
August 2005
 
524

 
540

August 2035
6.00

 
Quarterly
 
On or after 8/25/10
Capital Trust XI
May 2006
 
658

 
678

May 2036
6.63

 
Semi-Annual
 
Any time
Capital Trust XV
May 2007
 
1

 
1

June 2056
3-mo. LIBOR + 80 bps

 
Quarterly
 
On or after 6/01/37
NationsBank
 
 
 

 
 

 
 

 
 
 
 
Capital Trust III
February 1997
 
131

 
136

January 2027
3-mo. LIBOR + 55 bps

 
Quarterly
 
On or after 1/15/07
BankAmerica
 
 
 

 
 

 
 

 
 
 
 
Capital III
January 1997
 
103

 
106

January 2027
3-mo. LIBOR + 57 bps

 
Quarterly
 
On or after 1/15/02
Fleet
 
 
 

 
 

 
 

 
 
 
 
Capital Trust V
December 1998
 
79

 
82

December 2028
3-mo. LIBOR + 100 bps

 
Quarterly
 
On or after 12/18/03
BankBoston
 
 
 

 
 

 
 

 
 
 
 
Capital Trust III
June 1997
 
53

 
55

June 2027
3-mo. LIBOR + 75 bps

 
Quarterly
 
On or after 6/15/07
Capital Trust IV
June 1998
 
102

 
106

June 2028
3-mo. LIBOR + 60 bps

 
Quarterly
 
On or after 6/08/03
MBNA
 
 
 

 
 

 
 

 
 
 
 
Capital Trust B
January 1997
 
70

 
73

February 2027
3-mo. LIBOR + 80 bps

 
Quarterly
 
On or after 2/01/07
Countrywide
 
 
 

 
 

 
 

 
 
 
 
Capital III
June 1997
 
200

 
206

June 2027
8.05

 
Semi-Annual
 
Only under special event
Capital IV
April 2003
 
500

 
515

April 2033
6.75

 
Quarterly
 
On or after 4/11/08
Capital V
November 2006
 
1,495

 
1,496

November 2036
7.00

 
Quarterly
 
On or after 11/01/11
Merrill Lynch (2)
 
 
 

 
 

 
 

 
 
 
 
Capital Trust I
December 2006
 
1,050

 
1,051

December 2066
6.45

 
Quarterly
 
On or after 12/11
Capital Trust II
May 2007
 
950

 
951

June 2067
6.45

 
Quarterly
 
On or after 6/12
Capital Trust III
August 2007
 
750

 
751

September 2067
7.375

 
Quarterly
 
On or after 9/12
Total
 
 
$
6,699

 
$
6,781

 
 

 
 
 
 
(1) 
Notes are denominated in British Pound. Presentation currency is U.S. Dollar.
(2) 
Call notices for Merrill Lynch Preferred Capital Trust III, IV and V were sent on December 29, 2015 and settled on January 29, 2016.