Kevin Stitt – Investor Relations Kenneth Lewis – President & CEO Joe Price - CFO

Matthew O'Connor - UBS Mike Mayo - Deutsche Bank Betsy Graseck - Morgan Stanley Chris Mutascio - Stifel Nicholaus Meredith Whitney – Oppenheimer Jefferson Harralson - Keefe, Bruyette & Woods Ed Najarian - Merrill Lynch Nancy Bush - NAB Research

Welcome to today’s teleconference. (Operator Instructions) I’ll now turn the program over to Mr. Kevin Stitt; please begin sir.

Good morning. This is Kevin Stitt, Bank of America Investor Relations. Before Kenneth Lewis and Joe Price begin their comments let me remind you that this presentation does contain some forward-looking statements regarding both our financial condition and financial results and that these statements involve certain risks that may cause actual results in the future to be different from our current expectations. These factors include among other things changes in economic conditions; changes in credit quality; changes in interest rates; competitor pressures within the financial services industry and legislative or regulatory requirements that may affect our businesses. For additional factors please see our press release and SEC documents. And with that let me turn it over to Kenneth Lewis.

Good morning. I’m going to touch on some of the drivers affecting earnings in the first quarter and highlight results of our main businesses. Joe will then dig a little deeper into some of the issues identified along with further discussion about capital markets and advisory services, credit quality, the balance sheet and of course capital. Although consumer and commercial business flows were relatively strong in the first quarter revaluations of structured credit positions and higher credit costs more than offset these positives. By now you know that the businesses within capital markets were once again negatively impacted by continued market disruptions and dislocations like we experienced in the second half of last year. In addition first quarter reflected weaker housing markets particularly in geographic regions that experienced significant home price declines. This weakening along with the slowing economy has resulted in credit deterioration in our consumer portfolios particularly home equity and small business along with home builders on the commercial side. For the first quarter of 2008 Bank of America earned $1.2 billion or $0.23 per diluted share which included after-tax merger charges of $107 million or $0.02. Major items in the quarter included issuance of approximately $13 billion in capital in January bringing our Tier 1 ratio to 7.51%; a positive impact related to the VISA IPO; a significant increase in provision expense which resulted or included $3.3 billion of reserve increase; additional write-downs involving our super senior CDL and subprime related exposure, the leverage lending book and the CMBS book which all together totaled a little over $2 billion and finally additional support to the Columbia cash funds of $220 million. While the litany of negative issues left a clear mark on earnings there were bright spots within our core retail commercial banking and investment banking businesses that indicate ongoing stability and recurring earnings power. Looking specifically at global consumer and small business banking earnings of $1.1 billion for the first quarter were down almost 60% from a year ago. This drop was due to a $4 billion increase in provision which more than offset a 17% in increase in revenue with minimal impact from LaSalle. Revenue actually increased 3% excluding the VISA gain from the fourth quarter which we think is noteworthy given that the comparison of fourth quarter first quarter is normally a decrease due to seasonality. Compared to a year ago non interest income grew 21% excluding the VISA gain due to good performance in all categories. We increased the allowance for loan losses in the consumer businesses by approximately $2.8 billion due mainly to ongoing weaknesses in the housing market and the economy along with seasoning of several growth portfolios which Joe will discuss. Product sales were strong in several areas with net new checking accounts of 557,000 exceeding the total from a year ago by 14%. In residential mortgage the rate environment in early January caused somewhat of a mini refi boom that resulted in $23 billion of directed consumer fundings which was the strongest activity we had experienced in five years. There was evidence in the fourth quarter that we were beginning to regain some traction in retail deposit growth after several quarters of sluggish results and this evidence became more pronounced in the first quarter. Average retail deposits increased approximately $11.5 billion or 2.3% from the fourth quarter which we believe exceeds market growth. We maintained our number one ranking as card services lender in the US and UK with average managed consumer credit card outstandings up 3% from the fourth quarter and 10% from a year ago. Even though the economy is slow we continue to add new retail customers and expand our relationships with existing customers which is a trend we have been demonstrating over the past few quarters. Global wealth and investment management earned $228 million in the first quarter as revenue growth of 8% versus a year ago was impacted by the cash fund support of $220 million. In addition provision increased $220 million related to housing pressures on home equity loans. On the positive side asset management fees and GWIM increased 6% from a year ago after adjusting for the businesses we either added US Trust and LaSalle or sold Marsico. The integration of US Trust continues to be on schedule and will be substantially completed in the second quarter. Premier banking and investments experienced good growth in brokerage income, fee based assets, loan production and deposit levels. Loans with premier customers rose 14% from a year ago with organic growth in deposits up 6%. Assets under management and GWIM closed the quarter at $607 billion about flat with a year ago after adjusting for businesses we’d added or sold. Strong inflows including $13 billion into equity funds over the past 12 months were offset by negative market performance. Global corporate investment banking earned $115 million in the first quarter reflecting the negative impact of events in the financial and housing markets, although net income is up significantly from fourth quarter it is down from $1.5 billion a year ago. For the quarter C mass lost $1.1 billion versus earning $528 million a year ago driving the loss for the markdowns I referenced earlier. Otherwise our investment bank had good client activity with investment banking fees of $665 million reflecting good results in equity underwriting and investment grade issuance. Excluding C mass the rest of GCIB and that’s mainly lending and treasury services, earning $1.2 billion during the quarter up slightly from a year ago after adjusting for the VISA gain. Good client activity and the addition of LaSalle more than offset an increase in provision expense. Client activity drove an 11% organic growth in loans and better spreads. Not included in the three business segments is equity investment income of $268 million in the first quarter. This is below our range of $300 million to $400 million we talked about in January due to less liquidity in the markets. Now before I turn it over to Joe, let me make a couple of comments about our thinking given the current environment. As you realize by now first quarter was much worse than our expectations three months ago with the most notable deterioration in the latter part of the quarter. The issues we faced in capital markets in the fourth quarter continued into the first quarter with March being particularly difficult. Consumer credit quality deteriorated substantially from fourth quarter particularly in home equity. Going forward we believe actions by the Fed along with the eventual stabilization of home values should help the capital markets improve although not back to levels we experienced in 2006 and the first half of 2007. But even this will take time. Credit quality will continue to be an issue with charge-offs at least at first quarter levels but probably higher for the rest of the year. While we don’t expect to increase reserves at the pace we experienced over the past two quarters our reserving actions will correlate with the direction of the economy and its impact on our customers. Our economic expectations project minimal GDP growth if not contraction in the second quarter and only a slight pickup in the second half of 2008. Results from LaSalle continue to be positive and while the slower economic environment is having some impact things were generally in line with our expectations. We expect to close Countrywide early in the third quarter given regulatory approval and an affirmative vote by Countrywide shareholders. We believe the current CDO values are appropriate but are always subject to [approval] changes based on market conditions. Our Tier 1 capital ratio closed the quarter at 7.51% up from 6.87% at year-end. Our goal continues to be getting back to our target of 8% and we plan to do that through earnings generation and no share repurchases. Now instead of just focusing in on one capital ratio, we measure capital strength from several perspectives including total shareholders equity of %156 billion as well as the allowance for loan losses of $15 billion. And as evidenced by some recent events I think we were all reminded that capital is only meaningful when combined with liquidity strength. We continue to maintain an abundance of liquidity at our holding company where our time to require funding stands at 20 months; significantly higher than others. Given these parameters our outlook for the economy and our earnings potential we have not changed our philosophy about the dividend. But if the economy worsens dramatically from our outlook over the next few quarters resulting in a prolonged recessionary environment we would do what we think prudent to manage capital. We of course remained concerned about the health of the consumer given the prolonged housing slump, subprime issues, employment levels and high fuel and food prices. The drivers of our earnings for the remainder of the year will be our core businesses of retail banking, card, commercial banking, treasury services and asset management along with a tight grip on expense levels across the corporation. When I became CEO seven years ago, my goal was to build a franchise centered on prime US consumer and commercial customers. The groundwork for this franchise has centered on improving customer satisfaction, expanding our retail presence in card and in the North East and improving efficiency including the use of sic sigma. To address risk we exited subprime origination in 2001 and reduced our exposure to large corporate lending. All of those actions have provided us with a franchise that we think is the best in the world in financial services and centered on the US customer but of course exposed to the ups and downs of the US economy. While the current environment is the most challenging I have dealt with and while our US customer base is showing some weakness I firmly believe that the earnings power of the Bank of America model remain intact over the long-term. Most importantly we remain committed to serving our customers and clients while driving profitability during these tougher times. And with that I’ll turn it over to Joe.

Thanks Ken. Let me begin by taking a minute to elaborate further on some of the larger items affecting this quarter’s results. First the VISA IPO gain which is reflected in equity investment income at $776 million is split between our card business and treasury services excluding the reversal of related litigation costs. Much of the expense drop from the fourth quarter was related to book and the VISA litigation expense in the fourth quarter and then subsequently reversing that charge in the first quarter. Pushing expense levels the other way was the negative impact of FAS 123-R or $256 million in incentive expense which happens in the first quarter of every year when [effort] rewards are granted. Provision expense rose to $6 billion and included additions to reserves of $3.3 billion. Now let me turn to GCIB and address the write-downs in capital markets and advisory services. C mass had a loss this quarter of $1.1 billion as revenues declined $3 billion from a year ago but increased almost $3.9 billion from the fourth quarter. Investment banking fees were pretty good and although down from a year ago were notable given the tough market conditions. total revenue in C mass excluding investment banking fees or what we call sales and trading revenue, was a negative $1.3 billion as write-downs in several areas offset strong performance in interest rate products, foreign exchange and equities. Now addressing the write-downs let me start with leverage lending where we ended the quarter with exposure of just under $13.5 billion; $3.9 billion unfunded and $9.6 billion funded which included new commitments of $1 billion as we continued to do new business on current market terms. We actually did about $3.5 billion in new business with $1 billion left in the pipeline at quarter-end. During the quarter we wrote down an additional $435 million as market pricing continued to fall especially late in the quarter. As a reminder we don’t have any covenant light expose of note and over 60% is senior secured. Since quarter-end we’ve sold about $1.3 billion of exposure and did not provide financing with those transactions and we’re beginning to see some signs of increased liquidity in this market. On the CMBS side we ended the quarter with just under $12 billion in exposure which includes about $1 billion unfunded. Approximately three-fours or $9 billion is comprised of larger ticket floating rate debt most of which was acquisition-related. This floating rate debt was written down by $212 million in the first quarter net of $35 million in hedging gains. This product is a little more difficult to hedge as compared to the remaining $3 billion of exposure which is primarily fixed rate conduit product. During the quarter we actually had a net gain of $21 million on the fixed rate exposure, $396 million in write-downs offset by $417 million in hedging gains. The third area that hit us pretty hard this quarter relates to the structured credit trading book which we were winding down. During the quarter we neutralized a good deal of the market risk but widening credit spreads and increasing counter party exposure caused us to record counter party credit valuations of a negative $272 million. Finally in the supplemental package you can see our CDO and subprime related exposure along with the changes during the quarter where we recorded losses of $1.5 billion. These losses were comprised of $1.6 billion in super senior CDO write-downs offset by $400 million in hedging and other gains, a charge of $160 million to reflect counter party risk and $130 million in losses associated with our CDO warehouse and subprime exposure. At the end of March our net subprime super senior related exposure dropped to $5.9 billion from $8.2 billion at the end of the year reflecting the write-downs along with reductions of another $800 million due to liquidations, cancellations and pay-downs. At this point we see liquidations accelerating during the second quarter whereby we will most likely take possession of the underlying asset backed securities. During the quarter we took about $500 million on to the desk as part of liquidations at about $0.50 on the dollar or $250 million. Additionally CDO warehouse exposure is down to about $200 million and other subprime exposure is also around $200 million both reflecting [carrying] values of about $0.35 on the dollar. Although we remain subject to market price fluctuations we think the worst is behind us on these value declines. We continue to believe that once we work through these exposures and as the market trends back towards some level of normalcy we can achieve the earnings objectives we laid out for you last quarter when we discussed our C mass restructuring plan which in summary were revenue levels in line with the results we generated in 2005. Now let me switch to credit quality. On a HEL basis net charge-offs in the quarter increased 34 basis points from the fourth quarter levels to 1.25% of the portfolio or $2.7 billion. On a managed basis overall consolidated net losses in the quarter increased 35 basis points to 1.69% of the managed loan portfolio or $4.1 billion. Net losses in the consumer portfolios were 2.19% versus 1.77% in the fourth quarter. Credit card represents almost two-thirds of our total consumer losses. Managed consumer credit card losses as a percent of the portfolio increased to 5.19% from 4.75% in the fourth quarter which was a little better on a percentage basis than we expected but admittedly was driven by balance growth as opposed to lower losses. Thirty-day plus delinquencies in consumer credit card increased 16 basis points to 5.61% and we’ve continued to see increased delinquencies in our card portfolio and those states most affected by housing problems. California, Florida, Nevada and Arizona make up a little more than a quarter of our domestic consumer card book. Credit quality in our consumer real estate, mainly home equity deteriorated sharply in the first quarter as a result of the weaker housing market. The problems to date have been centered in higher LTV home equity loans particularly in states that have experienced significant decreases in home prices. Almost all these states have been growth markets in the past several years. Our largest concentrations are in California and Florida. Home equity net charge-offs increased to $496 million or 1.71% up from 63 basis points in the prior quarter. Thirty-day performing delinquencies are up seven basis points to 1.33%. Non-performing loans in home equity rose to 1.51% of the portfolio from 1.17% in the prior quarter. Eighty-two percent of net charge-offs related to loans where the borrower was delinquent and had little or no equity in the home. Loans with a greater than 90% CLTV on a refreshed basis currently represent 26% of loans versus 21% in the fourth quarter. This change reflects the continued decline in home prices most acutely in the states I noted earlier. Like others in the industry a material piece of the deterioration is centered in loans not originated through the franchise. These purchased loans represent only 3% of the portfolio but 20% of the net charge-offs in the quarter. As we mentioned last quarter we discontinued such purchases in the second quarter of 2007. Excluding these loans the net charge-off rate would be 1.41% and 52 basis points for the first quarter and first quarter respectively versus the reported 1.71% and 63 basis points respectively for the portfolio. We believe net charge-offs in home equity will continue to rise given softness in the real estate values and seasoning in the portfolio. We increased reserves for this portfolio to 215 basis points reflecting the continued elevate level of delinquency rolls, loss occurrences and loss severities. As a result we would expect to see losses cross the 200 basis point mark by the middle of this year as we work through these issues. Now we’ve instituted a number of initiatives to mitigate risk in new originations as well as existing exposure including lower maximum CLTVs across both geography and borrower. Two issues that plague home equity and drive losses higher are prolonged deterioration along with further deterioration in the economy. Our residential mortgage portfolio showed an increase in losses to $66 million or 10 basis points for the quarter but continues to perform well. While we’ve seen some deterioration in sub-segments namely our community reinvestment act portfolio that totals some 8% of the book nothing really stands out to us at this point. Let me remind you that approximately $161 billion or more than 60% of our residential mortgage portfolio carries risk mitigation protection. Of that amount approximately 80% is protected where we sell second loss exposures to cash collateralized structures where we have no counter party risk and the remaining 20% is with GSEs. Our auto portfolio at the end of March was about $25 billion in loans. Net losses in the quarter were $101 million or an annualized 1.65% of the portfolio which is up 12 basis points or $2 million from the fourth quarter related to deterioration in the most stressed housing markets. Switching to our commercial portfolios, net charge-offs increased in the quarter to $556 million or 69 basis points up 22 basis points from the fourth quarter. Almost all the deterioration is driven by small business and home builders with the other portfolios remaining relatively sound. Net losses in small business which are reported as commercial loan losses are up $78 million from the fourth quarter and the net charge-off rate has risen to 7.21%. As we’ve discussed before many of the issues in small business relate to how we grew the portfolio over the past few years which is now compounded by the current economic trends. As we also highlighted we have since instituted a number of underwriting changes such as increasing the level of judgmental credit decisioning, lowering initial line assignments and changing our direct mail offerings. These actions have resulted in an increase in average FICO at origination, a reduction in average line amounts and a meaningful drop in approval rates. While it will take some time to work through these earlier vintages small business remains a critical customer segment with attractive profitable growth opportunities. Excluding small business commercial net charge-offs increased $97 million from the fourth quarter to $197 million representing a charge-off ratio of 26 basis points. Ninety million of the $97 million increase was driven by commercial real estate and more than half of the increase represented one credit. The small increases are still coming off historic lows and part of the losses reflects net charge-offs from home builders which were approximately $107 million, an increase of $90 million from the fourth quarter. Criticized exposure excluding available for sale and fair value loans increased $5.2 billion from year end partially driven by commercial real estate, again principally home builders. Non-real estate criticized loan and derivative exposure increased modestly as well. The increase was pretty broad based and rising from very low 2007 levels. Commercial non performing assets rose $736 million to $3 billion. As we saw last quarter additional commercial NPAs involved commercial real estate, home builders to be specific. Home builder exposure was $14 billion at the end of March from a utilized standpoint at $21 billion including commitments. Forty-nine percent of our home builder outstandings is rated as criticized and although pressured we still believe as we said quarter the portfolio is well collateralized. Looking again at the total loan book, 90-day performing past due on a managed basis increased eight basis points to 74 basis points while 30-day performing past due increased four basis points. First quarter provision of $6 billion exceeded net charge-offs resulting in the addition of $3.3 billion to the reserve. Approximately 60% of the reserve build was in portfolios directly tied to housing principally home equity and to a lesser extent residential mortgage and the home builder sector of the commercial portfolio. Small business represented approximately 20% of the build. The remaining 20% of the reserve increase was due to growth in seasoning mainly in the consumer unsecured lending and US consumer card portfolios coupled with some stress from the slower economy. Okay let me get off credit quality and say a couple of things about net interest income. Compared to fourth quarter on a managed and fully tax equivalent basis net interest income was up $546 million of which core which is excluding trading related represented $47 million. The increase in core NII was due to the positive impact of $450 million from loan growth, deposit growth and a rate environment offset by the absence of a one-time fourth quarter benefit of approximately $300 million from the restructuring of our international aircraft leasing operations and one less day in the quarter of approximately $100 million. The core net interest margin on a managed basis remained flat at 3.67% as the positive impact of wider spreads were offset by the absence of last quarter’s leasing restructuring. And before I refer you to the bubble charts remember that our year end risk position had become more liability sensitive relative to the third quarter as we felt the forwards at December 31 didn’t reflect the level of weakness that we expected. We noted during January’s earnings call that after year-end as the forwards began to reflect that risk we had already begun to return to a more neutral level through decreasing our receives [inaudible] swap portfolio. As you can see from the bubble chart our interest rate risk position is a little less liability sensitive when compared to year end reflecting those moves. At this point we feel the additional cuts in the forwards are fairly reflective of our views. As a reminder the estimates of net interest income change in the charts are based off the forward curves to the bases higher at March 31st versus December 31st. We will continue to benefit from curve steepening especially from a short end [ledge] deepening which is what we have experienced over the last several months. Let me say a few things about capital. Tier 1 capital at the end of March was 7.51% up from 6.87% at the end of the year due to the $12.9 billion capital raise in January. The capital raise benefited our Tier 1 ratio by approximately 100 basis points versus year end levels but lower earnings in the first quarter and a higher level of risk weighted assets reduced that benefit by about 35 basis points. As Ken said we remain committed to working back to our 8% target. The additional capital increased our preferred dividends from approximately $53 million in the fourth quarter to approximately $190 million in the first quarter but still does not include the series K DRD preferred which starts paying in the third quarter and pays twice a year in the first and third quarters. Consequently going forward you should expect preferred dividends to be approximately $190 million in the second and fourth quarters increasing to $426 million in the first and third quarters. Our tax rate this quarter excluding the FTE impact was 32.7% which is in the range we expect for the rest of the year. Now going forward into 2008 let me piggyback on what Ken said and reiterate that there is considerable uncertainty about the economic environment. It still remains unclear what ramifications the housing downturn, higher energy costs and the subprime crisis will ultimately have and how long the downturn will persist. But we do feel good about our relative position in our businesses versus the competition. Loan and deposit growth generated by the franchise are still expected to benefit net interest income over the next three quarters along with the steeper curve. Deposits will grow as we continue to benefit from our market leadership and innovation and we expect to grow faster than the market. If you remember what we told you in January we expect growth in managed core net interest income to be in the high single-digit range on a normalized basis and above that on a reported basis from the addition of LaSalle. That outlook hasn’t changed. We’re still expecting growth in non interest income from our consumer businesses. Now the one major surprise since January was the accelerated deterioration in credit quality, mainly in the home equity portfolio. This will continue as a headwind due to what appears to be further deterioration in housing and its subsequent impact on consumer asset quality. Similarly we would expect to see challenges in the consumer dependent sectors of our commercial portfolios. Given this scenario we would expect net losses to be at least at the levels we experienced in the first quarter and more than likely increase which would require some additional reserve build dependent on the length and severity of the economic weakness. On the expense side we’re aiming for improved operating efficiency from heavy expense control as well as savings realized from the LaSalle integration. And while our outlook over the next several quarters has been tempered somewhat by the economic and credit quality headwinds we faced in the first quarter we still feel very good about our relative position and absent things getting dramatically worse I think earnings for the remainder of 2008 could show an upward trajectory. With that let me open it up for questions and we thank you for your attention.

Your first question comes from Matthew O'Connor – UBS Matthew O’Connor – UBS: The capital ratios are a little bit low or lower than some peers and I can appreciate the liquidity. There’s a couple of moving pieces that could benefit that have been discussed in the paper the last day or so with respect to China construction and the sale of the prime brokers business, just wondered if you could give us an update on where you stand there and then also the potential boost to capital from those transactions?

Let me start with China construction bank, as we indicated before over time we’ll work with the Chinese to see what the ultimate level where they would be comfortable with us holding and then on what schedule they’d want us to begin monetizing the remaining piece. I’d say we have to do that being ever mindful of what they wish and respect for them. We’ve got a great relationship there and we sure want to keep it that way is the way to think about it. Over time Matt, you’d probably see us increase a little bit before we did anything on the other side remind you that contractually we’ve got a lock-up on our investment until at least the fourth quarter. So right now on that side our focus on the strategic assistance agreement and the relationship. On the prime brokerage sale, we continue – not comment about any specifics of the activity, but we continue down a path to execute that transaction and we’ll let you know if anything in our plans change. Matthew O’Connor – UBS: And then in terms of the impact of capital, correct me if I’m wrong but as you exercise the options from China construction that would flow through OCI the large gain that you have there and boost capital right?

Over time but it would – any exercise of options contractually is subjected to a holding period and so just like our original investment didn’t come into OCI until within a year of when the restriction went off, the same would hold true for any increase in our investment. Matthew O’Connor – UBS: And then just switching topics here, Ken when I looked at from the loan growth in the consumer categories especially home equity it continues to be very strong and I know this is probably a good time to be increasing market share with standards a lot tighter and spreads a lot wider, but just conceptually how do you balance the risk reward of aggressively growing so this consumer categories when the macro environment is still so uncertain?

Well Matt I don’t know if its – its not an over attempt to aggressively grow it, it may be – there may be some issues with others not having liquidity or wanting to pull back in a general sense, but we’ve actually as we’ve said strengthened the standard substantially and turn downs have increased substantially. So it must be a factor of others not being as competitive in the marketplace and us really taking advantage of the fact that we do have liquidity and that spreads are so good and the credit quality is so good.

Matt I might add if you look at our quarter-to-quarter production we’re probably down about 15% in terms of origination on it so you can see the kind of flows slowing down a little bit because of those restrictions – those tightening of some of the standards and the structures but it’s still gone down considerably from the prior quarter. Matthew O’Connor – UBS: Okay great, thank you very much.

Your next question comes from Mike Mayo - Deutsche Bank Mike Mayo - Deutsche Bank: If you could elaborate more on how the credit quality problems are spreading. Joe I thought you said you might see an increase in consumer dependent commercial portfolios and I wasn’t sure what that meant or if I heard you correct.

Well first of all on the commercial side is I kind of went through in the speech that obviously the most acute weaknesses are in the home builder sector? The point I was making is as the economy slows and the consumer shows weakness that will have an impact on consumer dependent credits in the commercial portfolio and think of that – the easiest to think about Mike would be retail you know with retail spending slows or falls you’d see weakness on that side. Now we could talk to our customer base and when you look at our statistics across the middle market business across the United States if you compare it to 90 days ago, I think you’re hearing before hand you were hearing more concern about what they’re reading in the paper, now you’re feeling a little more of lower investment activity and things of that nature. So having an impact on them but more from an outlook than it is from actual deterioration of credit performance at this point. Mike Mayo - Deutsche Bank: So of your commercial portfolio how much would you deem consumer dependent in one way or another?

I think the best thing I could do is refer you to our supplement where you can see the industry breakdown because how much of an individual industry is consumer dependent is probably a little more in the eye of the beholder on that and that would be the best way to look at it. But clearly if you start with home builders and then you look at home building supply type companies and then you go on into retail that’d be kind of the way to think about it. Mike Mayo - Deutsche Bank: Okay and with regard to small business the increase in problems which you highlighted is that more in the problem markets like California and Florida or is it more of a product issue or both?

Clearly weighted towards the places that have had the most stress being the places home prices are falling the most. Mike Mayo - Deutsche Bank: And the increase in commercial real estate, how much of that is due to LaSalle or is that just kind of a broad franchise issue?

Most of the LaSalle impact came in in the fourth quarter although as we continue to conform our policies into the Bank of America standards we had some additional migration into the criticized level but for the most part most of LaSalle came in in the fourth quarter. Mike Mayo - Deutsche Bank: And home equity where do the losses end does it ultimately go up to credit card type losses?

Who can predict the future but I would not think that that would be the case? As I said it wouldn’t surprise us to see that cross in the 200 basis points by the – by mid year and in that 2% to 2.5% range probably for the year but its clearly dependent on future additional home price depreciation and the economic weakening and how the duration of the economic weakness. Mike Mayo - Deutsche Bank: And are you seeing that spread out of the high risk markets like California or Florida?

Yes, absolutely. Mike Mayo - Deutsche Bank: Okay, so this is just not necessarily only a function of markets with big house price declines?

Ask your first one again Mike. Mike Mayo - Deutsche Bank: I just want to make clear, I mean the higher risk markets are those with the highest home price declines like Florida and California and to the extent that the home equity problems are spreading beyond those higher risk markets.

There is some spread but the lion share and we put some information in the supplement to try to give you a lot of details, you can see where what’s driving our losses and our delinquencies by state so you can see and there are not solely those markets but it’s clearly dominated by those markets.

Mike, some huge percentage of the losses are driven by California and Florida. Mike Mayo - Deutsche Bank: Okay and then you’re NPAs went up but your charge-offs also went up almost a similar amount whereas a lot of other banks are saying charge-offs may increase over time. So it’s more coincident for you that others? So it at least raises a question as to whether you were conservative enough in the past in recognizing the charge-offs or something else is going on here for you versus peer?

Well I don’t think we reserve, as you would expect me to say, we reserve each quarter based on the information flow that we have so that’s our quarterly process. The actually increases in non performing versus charge-offs, you’ve got to remember the size of our credit card book that generates the lion share of our charge-offs, consumer charge-offs overall doesn’t necessarily – doesn’t flow to a non performing asset. Our home equity book which we reserved more for involved charge-offs jumped – they jumped 171 basis points from the 63, we see stuff moving into non performing out of that book of business as well as the mortgage business which has low charge-offs. So it’s a mix. It all depends on what the mix of the business and what goes into non performing versus your charge-off policies on some paper that goes straight to charge-off with nothing going into NPAs. Mike Mayo - Deutsche Bank: Okay thank you.

Your next question comes from Betsy Graseck - Morgan Stanley Betsy Graseck - Morgan Stanley: On the reserve building could you give us some indication as to how you’re thinking about that going forward, is it just tied to your MPA growth or it there anything else there that we should be considering?

Our reserving policies are kind of – you have to think of it as commercial versus consumer and on the consumer businesses we generally take the information that we know that exists in the portfolio and extrapolate that forward and reserve a certain number of months, generally think of it as about 12 months, although card is a little bit less than that and that’s pretty standard across the industry and somewhat regulatory driven. And so it’s not based off MPAs. On the commercial side, we have a process that we go through that looks at the criticized levels and increase and the ratings within the criticized levels and those tend to be probably the bigger drivers than MPAs. MPAs are really the culmination at the end of migration through criticized so that’s probably more of a driver for you to think about than MPAs themselves. Betsy Graseck - Morgan Stanley: And how’s the criticized doing on a Q on Q basis, is there much difference from what the MPAs are telling you?

We’ve given you in the supplement the criticized information so you can see the details. The MPAs are driven in large part by the consumer business and whereas on the commercial side it’s driven by less of an increase on the commercial side. So there’s not really a connect point there. A lot of the growth in and as I talked about earlier, a lot of the growth in the criticized and commercial is commercial real estate and in particular home builder focused and that’s why we kind of laid out all that detail for you so you could see it. Betsy Graseck - Morgan Stanley: Right, it kind of looks on the home builder side like you might be entering the tail end of that cycle, is that fair to say or not?

That’s kind of dependent on home prices and you know the companies clearly there are things being considered in the marketplace and some of the congressional discussions going on that would assist the home builders but I think you know the home builders’ recovery will probably track more home price stabilization than anything else. Betsy Graseck - Morgan Stanley: Okay, so on leverage and the capital markets business; could you just give us a sense as to how you’re thinking about your leverage at quarter end and how you see that going forward? Are you pretty much done with your deleveraging there or is there more to go?

Deleverage, you’re speaking to the restructuring? Betsy Graseck - Morgan Stanley: Correct.

Brian’s team is in the midst of I guess is what I’d say, I mean obviously we talked about prime broker sale being a part of that and as I referenced when we talked about capital our asset levels and think of this principally as risk weighted asset levels are a little higher than where we’d like them to be and it’s a very place we’re very much focused on so from a business activity standpoint most of the things have been initiated. From a management of balance sheet and return in to the level of profitability we’ve got a ways to go there. Betsy Graseck - Morgan Stanley: Okay but we could see some [inaudible] assets coming down as you do that. And then on the net interest margin side, I realize there’s the core business and there’s the trading business, and then there’s also the opportunity you have to take advantage of the yield curve steepness in particular on the back end of the curve, could we anticipate a little bit more activity in perhaps either the trading side or the swap book to benefit more from the back end of the curve than you’ve been generating to date?

I think not beyond what we’ve kind of tried to tell you about the projection of net interest income or the outlook on net interest income that I reiterated earlier, that kind of incorporates our full view of – and that was core that I was talking about, of where we are and what we’re thinking about there. The capital market side that had a pretty strong growth over prior quarter was curve dependent but also level dependent based on the comments I made earlier on the asset levels so that one is a little more market sensitive, it’s probably as much short end driven, you know curve driven, as it is long end. The core machine though is incorporated in what we told you and kind of an outlook that we have in the bubble charts. Betsy Graseck - Morgan Stanley: Okay thanks.

Outlook shows sequential improvement or increases and so you’ve just begun to see it in the first quarter. Betsy Graseck - Morgan Stanley: Okay thanks.

Your next question comes from Chris Mutascio - Stifel Nicholaus Chris Mutascio - Stifel, Nicholaus & Company: Joe I just had a quick question, the VISA reversal, have you disclosed the amount of the reversal this quarter on the operating spend side?

No but I would tell you that it wasn’t too far off of the – of negating the 123-R. Chris Mutascio - Stifel, Nicholaus & Company: Okay thank you.

Your next question comes from Meredith Whitney – Oppenheimer Meredith Whitney – Oppenheimer: My first question is just a point of clarification, did you – it looks as if several of your product buckets loan losses are accelerating, so I’m confused or do I hear things right in terms of you’re saying that the loss rates will stay constant or at these levels because by my estimates levels would get significantly higher as losses are accelerating?

Are you talking about loan losses? Meredith Whitney – Oppenheimer: Yes.

No, the point that we were making in the prepared remarks was we would see our charge-off levels increasing and obviously by the fact of what we reserved that’s a clear indication of our anticipation that we would see those continue to trend up and that’s what we reserved for. Meredith Whitney – Oppenheimer: Okay and then on the OCI line, can you quantify how much you had to write-down CCB this quarter?

Yes, the CCB drop was –

I think it was about $3 billion.

Yes but I would say that if you – I don’t watch it daily but if you looked stock is back up to about where it was at the end of the year, maybe slightly below so that fluctuates. Meredith Whitney – Oppenheimer: Okay and then my final question is to Ken, what of the policies in Washington are the most reasonable or you believe are the most helpful of some type of best case scenario for you and then from a timing of how it would impact your portfolio, your workout, can you comment on the environment in Washington, the conversations that you’re having just to give us who are not in the inner circle a little more perspective.

Yes well there are several and I’ll probably forget one or two but one of the things I liked the most – one thing was the raising of the limit on what Freddie Mac and Fannie Mae could do. That’s going to help the higher priced markets. And then secondly the – I really liked this tax credit to buy foreclosed homes because that’s very specifically getting at the inventory that would actually help stabilize prices quite a bit. And then generally are in favor of most of the things that are being proposed other than things like having judges being able to change the terms, I don’t like that. But basically I think most of the things are being proposed are pretty well thought out. Meredith Whitney – Oppenheimer: Okay, now soon would any type of implementation is this going to be implemented after the fact so you’d benefit in a 210 scenario? Is there any way to know how immediate these actions can take place?

Well I hope they would be done quickly and of course would hope they’re done after the fact because that would mean things had improved dramatically but that is a concern that things go on and we get into philosophical arguments and nothing happens or it happens too late and so we’re trying our best to state they should be a sense of urgency here. Meredith Whitney – Oppenheimer: Okay so then when you see – mainly see as from brokerage firms saying that we’re beyond the worst of things; can you comment in terms of the regulators involvement with the housing situation and make any similar type of comments?

Well in a broad sense and I wouldn’t just talk about regulators or the government I think first it would be too early to strike up the band and sing Happy Days Are Here Again. But from the investment banking standpoint that is the write-offs, I do think we’re in the last innings or the last quarter whatever sports analogy you want to use and then the other – the credit issue is so housing dependent and related and economic and economy related that I think we’re not in the last inning or the last few innings and we’ve got at least the rest of this year to go again as Joe said and we said in our comments that we have very high levels of charge-offs and possible additional reserve builds but not the level of reserve builds that we’ve had for the fourth and first quarters. Meredith Whitney – Oppenheimer: Okay thanks.

Your next question comes from Jefferson Harralson - Keefe, Bruyette & Woods Jefferson Harralson - Keefe, Bruyette & Woods: I wanted to focus on the home equity book if possible, how much of the $118 billion are first mortgages versus seconds?

Let me – I don’t have that stat right in front of me Kevin can you get back to Jefferson. Jefferson Harralson - Keefe, Bruyette & Woods: Appreciate that and then in the 2007 vintage, we see you had a loss rate of 108 how would that compare against 2006 a year ago, is it the seasoning worse than the ’06 or better than the ’06?

I don’t have the numbers right in front of me, I don’t have the specifics but I would tell you that its tracking probably a little worse and if you just think about what’s happening in the economic environment because the acute housing declines have occurred during that period and so just by virtue of that factor you’d probably see it tracking higher than the ’06 at that earlier date. Jefferson Harralson - Keefe, Bruyette & Woods: Okay thanks and could you remind us how quickly or what the refreshed loan to value is and how you get the refreshed numbers and how I guess what calculation do you do arrive at the refreshed, is it a new appraisal or what on the refreshed number?

First of all we provided in the supplement I think the refreshed numbers on all of the – on home equity as well as mortgage, you’ve got that in the package. The process is an automated process just the way we refresh FICOs, we do it with loan to value ratios or combined loan to value ratios in that – its not a go out and get new reappraisals on every portfolio, its through the appraisal services that you can bounce the whole portfolio off of. Jefferson Harralson - Keefe, Bruyette & Woods: Okay thanks.

Your next question comes from Ed Najarian - Merrill Lynch Ed Najarian - Merrill Lynch: Two quick questions; first could you potentially give us some perspective on your managed credit card loss outlook for the rest of the year and how you would expect that to trend and the second question would be Ken, you mentioned that you have not changed your dividend philosophy but then went to say in a prolonged recession we’d clearly have to consider the most prudent way to manage our capital which to me sort of implied that there would be some chance of a dividend cut in a prolonged recession. Could you talk about what kinds of things you would think about or look for that would potentially lead to a dividend cut and also in light of that, would you cut the dividend first or raise more capital? Assuming you needed to raise more capital would you go out and raise capital to try to preserve the dividend or would you look to cut dividend before another capital raise?

On your first question on managed credit card losses we were at 5.19 on the consumer card in the first quarter. We kind of talked about in the past that we saw a range of 5 to 5.5 is kind of the normal operating range but obviously if you go into a recessionary period you could bounce over that. At this point I’d say that we may be over that in a quarter here and it wouldn’t surprise us on an annual basis to bounce above that if this kind of economic condition continues and that’s really where we’re at right now. You can – we reserve between somewhere I’m going to rule of thumb call it about 11 months of that you can see on the supplement package we gave you, we reserved to about 525 if you extrapolate that.

On the dividend question obviously the key thing that we would look at is just how earnings are being affected and after-tax earnings and after-tax after preferred earnings are related to the dividend itself and I’ll repeat what we see in our forecast and what we see for the economy would not lead us to think that we needed to do anything. But obviously that earnings ratio to just the coverage is a – it would be a big factor. Now the first quarter was a little – somewhat of an anomaly in that you take $3.3 billion of pre-tax earnings and put it in your reserve but its still on the balance sheet and still [inaudible] of capital but our second quarter will be critical quarter for us to see if earnings return to what we think would be going toward more normal levels and we’ll kind of go from there but if – I would say that first we would look at – if we thought we needed more capital we’d look at preferred. We would not look at preferred convertible but then after that if things really got bad then we would look at the dividend.

And I might add that we clearly are focused on asset levels and the [outlaid] assets on the capital market side too.

We’ve got some hard work to do this quarter on asset levels and C mass. Ed Najarian - Merrill Lynch: Just so I could reiterate that you would look to issue preferred before you would probably cut the dividend if things got bad or worse?

I think – I was just thinking in general terms but if things got noticeably worse then – and our view of things was that they would continue to be worse for some period of time, a prolonged recession then of course we’d look at the dividend. Ed Najarian - Merrill Lynch: Okay thank you.

Your final question comes from Nancy Bush - NAB Research Nancy Bush - NAB Research: This would just sort of be a follow on Ed’s question I guess, the Boston Fed President Rosenberg was quoted in the Boston Globe a couple of days ago saying that the Fed was actively encouraging banks to look at raising capital and part of that being of course the dividend cuts which seems to be a bit more active a stance on the part of the Fed than we’ve seen in a while. Can you just comment on this Ken, have you had that conversation with them and are they sort of making the rounds and saying nothing is off the table here? What’s going on?

I know that in general there’s a – that general feeling that a bank should be looking to cut their dividends if there are capital issues, and I know the Secretary of the Treasury, Hank Paulson has said the same thing but I don’t know exactly who they’re referring to because we would remind everybody that their definition of well capitalized is 6% and so they must be talking about ones that are actually pushing toward that lower end and I think that generally as we talk about they do look a little more holistically and do look at loan loss reserve builds and look at liquidity levels and look at [sheer] levels of equity in addition to just the Tier 1. I think our, I’m not sure I have not researched this, but I think our level of equity capital is the largest base of equity capital of any financial institution in the world and to me that means a little something. Nancy Bush - NAB Research: I would also just add on to that and this may be more of a question for Joe, has the loan loss reserve methodology, not just the number but the methodology changed dramatically versus a year ago. Because it was also heard that the regulators have now been urging more of a prospective look in building the reserve and the SEC and the GAAP issue has at least temporarily gone away. Can you comment on that?

No Nancy it hasn’t changed. Our methodology hasn’t changed. What sometimes gets blurred with a change in methodology that could be leading to some of the discussion that you have is when you get such volatility in your outlook, what you should consider and you shouldn’t is a harder question than when you’re just kind of straight lined in the less volatile period – when you just don’t have that level and that’s where the grey area begins to come in. So I think it’s not a methodology change its just you’re in a more volatile outlooks and how you consider all of those various factors is where the grey matter is a little bit. Nancy Bush - NAB Research: Thank you.

That was our final question so I’ll turn this call back to our speakers for any closing remarks.

Thank you everyone for your participation and have a good day.