Bank of America (BAC) Stress test presentation summary

Capital planning process and governance

• Capital planning integrates risk identification, measurement, and loss estimation across scenarios, overseen by a senior management committee with robust internal controls and governance.

• The process includes standalone impact analysis for risks not fully captured in stress testing, comprehensive capital policy, contingency planning, and effective oversight.

Stress test scenario assumptions

• The Supervisory Severely Adverse scenario models a severe global recession with a 4.6% RGDP decline, 10% peak unemployment, 38.8% CRE price drop, 29.7% home price drop, and 57.8% equity market decline over nine quarters.

• Instantaneous global market shocks are applied to trading and counterparty exposures, with capital ratios calculated under the Basel 3 Standardized approach.

Bank of America Corporation (BAC) results

• Projects a $3.4B cumulative pre-tax loss over nine quarters, with $39.2B in loan and lease losses, $13.1B in provision expense, $8.4B in trading/counterparty losses, and $4.6B in other losses, offset by $62.1B PPNR.

• Estimated minimum capital ratios: CET1 9.5%, Tier 1 10.9%, Total Capital 13.1%, Tier 1 Leverage 6.2%, Supplementary Leverage 5.2%.

• RWA increases are driven by commercial loan draws and trading book exposures, partially offset by lower consumer loans.