US investment firm Bank of America’s sales of structured products via its distribution channels have fallen from US$3.3 billion in the first quarter of 2020 to US$2.1 billion in the fourth quarter

Bank of America (BofA) finished 2020 in fourth place with 180 structured products worth US$2.07 billion, trailing behind Morgan Stanley (721 products/US$3.9 billion), UBS (1,534 products/US$3.8 billion) and Goldman Sachs (553 products/US$2.1 billion). Eighty six of the products marketed in 2020 were issued by BofA Finance with Scotia Bank (21 products/US$301m), Barclays Bank (19/US$613m), HSBC (18/US$432m) and CIBC (18/US$264m) as the bank’s preferred issuers for its products.

The bank led by Brian Moynihan (pictured) saw its structured products sales as a distributor group decreasing compared with the same period of 2019 which stood at US$2.9 billion, making it the third most prolific distributor on the league tables at the time, according to SRP data.

SRP data shows that BofA has 1,359 live structured products that are domestically listed and wrapped mostly as registered unlisted notes and exchange-traded notes which offer exposure mainly to market cap indices such as S&P500 (464 products/US$9.9 billion), Eurostoxx 50 (308/US$4.8 billion), Russell 2000 (282/US$2.2 billion), DJ Industrial Average Index (174/US$ 2.8 billion), and Nikkei 225 (151/US$2.3 billion). 

 

Total revenues net of interest expense tumbled in FY2020 to US$85.5 billion from US$91.2 billion in FY2019, while net income also decreased to US$17.9 billion from US$27.4 billion the previous year.

FICC revenue decreased five percent to US$1.7 billion, as weaker trading performance in macro products and mortgages outweighed gains in credit.

Equities revenue increased 30% to US$1.3 billion, driven by strong trading performance in cash and derivatives and increased client activity.

Provision for credit losses decreased to US$53 million, reflecting a reserve release of US$828 million. Noninterest expense increased 5% to US$13.9 billion, driven primarily by higher net Covid-19 costs.

Total risk-weighted assets stood at US$1.4 billion as of 31 December 2020, remaining steady from its September 2020 and December 2019 figures.

Click here to view BofA’s Q4 20 earnings.