Kevin Stitt - Director, Investor Relations Brian T. Moynihan - Chief Executive Officer Joe L. Price - Chief Financial Officer

Glenn Schorr – UBS Matt O’Connor – Deutsche Bank Ed Najarian – ISI Group Betsy Graseck – Morgan Stanley Paul Miller – FBR Capital Markets Jefferson Harralson – KBW Michael Mayo – CLSA John McDonald – Sanford C. Bernstein Moshe Orenbuch - Credit Suisse

Welcome to today's teleconference. (Operator Instructions) It's now my pleasure to turn the program over to Kevin Stitt.

Good morning. Before Brian Moynihan 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 interest rates, competitive 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 Brian. Brian T. Moynihan: Good morning and thank you for joining us on this busy day on our earnings call. Over the past couple of years I might have spoken to many of you regarding the various businesses that I have run within Bank of America, and in my new role of CEO I would tell you that I am honored to serve this company, its customers, associates, and importantly, its shareholders. I firmly believe that we have built one of the best franchises in the industry, if not the best, with the ability to serve customers and clients of all types on a global basis. My team and I plan on leveraging our leading market positions with capabilities that we believe match or exceed our competitors. Our goal is to refocus our efforts here at Bank of America, refocus our efforts and our attention on those core capabilities that will make Bank of America a winner in the years ahead, drawing on our long tradition of operational excellence and strong execution. I know there are several banks and several companies reporting this morning, so I know that you are anxious to get directly to the numbers. For the fourth quarter of 2009, Bank of America had net loss of $194 million, before the $5 billion impact of preferred dividends and repayment of TARP, which resulted in a loss of about $0.60 per diluted share. Included in the $5 billion was $4.6 billion related to our preferred stock, including the $4 billion associated with repurchasing our preferred, as the book valued of our preferred was less than the amount paid. For the full year 2009, before preferred dividends, net income was $6.3 billion or a loss of $0.29 per diluted share, after deducting preferred dividends and TARP repayment. TARP dividends and the TARP repayment for all of 2009 represented $0.94 per diluted share. The financial crisis has taken its toll on our company in many ways during 2009. With respect to our investment by the government, during 2009 we repaid the $45 billion of preferred stock; we have paid dividends of $2.6 billion; we paid termination fees on the proposed asset wrap of $425 million; we paid about $3 billion in various insurance fees, including our normal FDIC expense; and we prepaid [inaudible] in FDIC premiums. In addition, we issued the government warrants to buy 122 million and 150 million shares of our company at $30.79 and 13.30 respectively. In summary, these are heavy costs that represented just some of the challenges that our associates had to contend with in 2009 as they competed in the market. But with these behind us, we clearly look forward to 2010. Moving to the revenue, total revenue for the fourth quarter of 2009 on an FTE basis was in excess of $25 billion. Pre-tax, pre-provision income was approximately $9 billion, even after the impact of some unusual items that Joe will detail a little bit later. There were several positive trends in the quarter. First, credit quality appears to be stabilizing, if not improving. Net credit losses in dollar terms decreased $1.6 billion from the third quarter of 2009, supporting our comments in October that overall credit costs were peaking. Second, the capital markets environment reflected strong investment banking revenue, up substantially from our third quarter which was already a strong quarter in the business, and we retained our second-place position in that business. Next, results in our Global Wealth and Investment Management team continued to prove strong asset management fees and brokerage income driven by improving markets and increased client activity. In addition, the number of our financial advisors has stabilized at 15,000. Across our franchise, new deposit generation maintained its positive momentum with overall total corporate-wide average deposits of nearly $6 billion, despite a substantial drop of $15 billion in wholesale funding. In addition, we continue to meet and exceed many of the milestones around both Merrill and Countrywide integrations. Now unfortunately, any earnings impact these cause are more than offset by continued high level of credit costs, lower customer activity due to the economic environment, and some other items that have been headwinds for most of the year 2009. Total credit extended in the fourth quarter was $177 billion, including commercial renewals, versus $184 billion during the third quarter, as growth in our commercial areas was more than offset by lower mortgage production. The large components of this production for the fourth quarter were $87 billion in first mortgages, down from $96 billion in the third quarter; $66 billion in non-real estate commercial; $11 billion in commercial real estate; the remaining $13 billion includes $9 billion in other consumer retail loans and $4 billion in small business loans. Despite these new extensions, loan balances overall declined since we did charge-offs, lower consumer spending, lower commercial client activity and a resurgence in the capital markets, allowing larger corporate clients to issue bonds and equity, replacing loans as a source for funding. We note that companies who are our clients continue to be very cautious and we are not yet seeing the typical level of business activity for a recovery. As we move to provision expense, in the fourth quarter it decreased from the third quarter by $1.6 billion, driven by lower net charge-offs. Credit costs included a $1.7 billion addition to reserves, versus $2.1 billion in the third quarter. Roughly half of that reserve increase in the quarter was driven by a change in reserve coverage in consumer credit card to a full 12 months. Let me make a few comments about the current economic environment. For almost six months now many major economic indicators have been improving at the national and global levels, which hopefully indicate we have reached the bottom of the cycle. Our economic team here at Bank of America currently forecasts global growth in 2010 above 4%, led by emerging markets and growth in U.S. GDP of about 3%. Embedded in that aggregate outlook are our views on four economic indicators we believe highly correlate to future economic performance. First, the labor market. We believe we can anticipate positive job growth during the first half of 2010, but even with that the number of unemployed will remain very large for quite some time and extend the drag on consumer spending and overall economic growth. Second, in the housing market, although home prices in the largest 20 markets have posted back-to-back monthly price increases for the past few months, the potential new round of foreclosures required represents some downside risk to that stability. Third, on household net worth, the recovery in the equity market and stabilization of home prices have led to recovery in total household wealth over the past several months. The consumer balance sheets, especially those for less-affluent customers, remain under stress. Fourth, in manufacturing there is an ongoing recovering in U.S. manufacturing that is benefitting from a firming global economy, as you can see in the recent survey results. So all this tells you is while things are improving slowly, the U.S. economy remains fragile. For our company, the recovery and strong performance in our market-sensitive businesses offer diversification to offset the core credit headwinds we continue to face on our core commercial and consumer lending businesses. Although we believe we saw the peak in the third quarter, net loss levels remain elevated for the next several quarters. Additions to reserves have come down and although there may be some additions in some business lines for the first half of 2010, overall we believe at the corporate level significant additions to reserves are hopefully over. While we still have several quarters before we can discuss actual normalized earnings, we believe that the economy is stabilizing, markets are opening, and customers sentiment is improving. Now at this point let me turn it over to Joe for additional color and commentary on the numbers. Joe. Joe L. Price: Thanks Brian. Over the next few minutes I will plan to cover the performance of each of our businesses, credit quality, the margin and some other topics, including some comments about 2010. But before getting into the business results, let me highlight the large items that impacted earnings in the fourth quarter, and you can see these on Slide 6. As most of you are aware, structured notes issued by Merrill Lynch are mark-to-market under the fair value option. This resulted in a hit to earnings of $1.6 billion, $4.9 billion for the whole year, on a pre-tax basis primarily due to the narrowing of Merrill Lynch credit spreads. If you remember, the mark was a negative $1.8 billion in the third quarter. Now as a reminder, the impact of marking our structured notes does not impact Tier 1 capital. Looking forward, while most of the negative marks should be behind us, the Merrill Lynch spreads are still outside Bank of America’s, but not by much. Additionally, our spreads are clearly outside pre-disruption levels. On the credit valuation side, the adjustments on derivative liabilities, and this is principally in our trading businesses, resulted in a negative impact of $186 million versus a negative of $713 million in the third quarter. Our global markets revenue took additional write-downs this quarter of $1.1 billion, due to legacy positions versus a net positive of $218 million in the third quarter. Included here on the commercial real estate side, we took a charge of approximately $850 million, the remaining $250 million of marks were spread over leveraged finance, structured credit trading, CDO exposure and auction-rate securities. Equity investment income included the pretax benefit of $1.1 billion which was a write-up related to our Blackrock ownership driven by Bear equity issuance in connection with the BGI acquisition. In non-interest expense we recorded over $500 million for litigation-related matters. In the fourth quarter tax rater, the tax benefit of a loss, was higher than statutory due to tax benefits on certain foreign subsidiary restructurings in connection with our merger activities, as well as benefits from tax audit settlements. For 2010, we expect the effective rate to trend closer to statutory less $1 billion to $2 billion in what I would call recurring benefit, absent any unusual items or changes in tax rules. Now let me quickly touch upon some of the highlights of each of the businesses this quarter. In our deposit segment, and this is on Slide 8, earnings were $595 million in the quarter, down approximately $200 million from the third quarter. Net interest income of $1.8 billion was relatively flat with the third quarter, while non-interest income of $1.7 billion decreased $257 million, due mainly to the actions we highlighted in October around overdraft fee policy changes. We estimate the impact was about $160 million, in line with what we conveyed to you in October, with the rest of the decline coming from normal seasonality and to some extent, customers better managing their cash flow. Non-interest expense of $2.4 billion was flat to the third quarter. Now on Slide 9 you can see average retail deposit levels for the quarter, excluding Countrywide, were up almost $12 billion, or almost 2% from the third quarter, which we believe is quite strong. We continue to see a products mix shift from CDs to higher margin liquid products, with checking products now representing 43% of the retail deposit balances. Merrill Lynch continues to show momentum as financial advisors provide the customers with the benefits of an expanded product suite through cross-selling. In Global Card Services on slide 10 we had a loss of $1 billion, in line with third quarter results. Revenue was down 2% from third quarter due to lower net interest income and fees. Although provision was almost flat, or down $51 million, managed net losses were down approximately $920 million. Provision was impacted by an increase in the consumer credit card reserve coverage to 12 months – and that was about $800 million – and reserve additions for maturing securitizations, and that totaled about $550 million. These increases were partially offset by reductions in reserves for improvement in the domestic portfolios, and I will come back and give you a little more on credit in a few minutes. Average managed consumer credit card outstandings were down 3.5% from the third quarter to $163 billion. Now on an encouraging note, and this is on a per-average-account basis, retail spending on credit card was up 8% and debit was up 5% for the holiday season versus last year. We also continue to add new accounts – 586,000 new domestic retail and small business credit card accounts in the quarter, with credit lines totaling approximately $4 billion. Now home loans and insurance, and you can see this on Slide 11, experienced production levels slightly below third quarter activity but included better MSR hedging results. As a result, total revenue for the quarter was $3.8 billion, up $382 million from third quarter levels. Production income decreased $55 million as higher margins were offset by lower production volume and secondary market gains. Now this is also the line item where we record warranties expense which was up a little this quarter as well. Servicing income increased $447 million, primarily due to better MSR performance net of hedge results. Now the capitalization rate for the consumer mortgage MSR asset – and that is versus a combined consumer commercial you might see reported in the industry -- ended the quarter at 113 basis points, versus 102 basis points in the third quarter as interest rates were higher at the end of the quarter, lowering prepayment risk. Provision decreased $647 million to $2.2 billion while net charge-offs decreased $462 million to $1.5 billion. Additions to the reserve of $748 million for the quarter were down $185 million, with most of the reserve addition associated with our home equity purchased impaired portfolio. Fourth quarter first mortgage fundings for the corporation were $87 billion, down 9% from the third quarter, or $96 billion, which was reflective of the rate environment. Approximately 42% of these fundings were for home purchases versus approximately 39% in the third quarter. Now we continue to maintain strong market share during the quarter, which we estimate to be in the 23% to 24% range. Now given the industry outlook for refinance and purchase transactions indicated by the Mortgage Bankers Association for 2010 volume of $1.3 trillion, about 40% less than last year, we would expect lower production levels over the next few quarters. Now turning to Global Wealth and Investment Management, and you can see this on Slide 13, they earned $1.3 billion in the fourth quarter, an increase of $1.1 billion from third quarter levels due mainly to the Blackrock gain and lower provision. Asset management fees and brokerage income were up $75 million due to market valuations, but more importantly, increased sales and transactional activity offset by various other items. In addition, there were no charges for supporting the cash funds, versus the approximately $135 million of support in the third quarter. As a reminder, Columbia’s money market funds no longer have exposure to structured investment vehicles. Now provision was down approximately $460 million due to an improved credit outlook for the consumer real estate side, and the absence of a large fraud loss in the third quarter. Assets under management ended the quarter at $750 billion, up $10billion from the end of September as the improvement in the market and positive flows generated by the advisors were partially offset by continued outflows in the Columbia cash complex. We ended the quarter with over 15,000 financial advisors, up slightly from the end of September, and with improved retention trends throughout the quarter. Also, as you already know, we finalized details on the sale of the long-term asset management business of Columbia to Ameriprise, and that's expected to close in the second quarter of this year. Using the low end of the range we disclosed, we believe this will have minimal P&L impact but we expect to monetize nearly $800.0 million of goodwill intangibles, thereby improving capital slightly. Now Global Banking, and you can see this on Slide 14, and remember that this encompasses our commercial bank, corporate bank, and the investment bank, had an increase in earnings of $224 million versus the third quarter, due mainly to improved investment banking income and lower credit costs. And although commercial and corporate clients are being cautious given the economy and loan demand is down, we continue to see improving liquidity in the credit markets, with credit spreads and market prices more reflective of the underlying risk. Provision expense decreased 12% to $2.1 billion while net charge-offs decreased 18% to $1.4 billion. Now we did continue to add to reserves during the current quarter, $627 million, mainly associated with commercial real estate, slightly higher than the addition in the third quarter. Average loans as reported for the quarter were down 4% from the third quarter as clients continued to aggressively manage working capital and operating capacity levels. In doing so, clients continued to take advantage of the robust bond markets to manage bank debt levels, and build cash in anticipation of a stronger economy. As a result, we saw average deposit levels increase $15 billion, or almost 7% from the third quarter. Now investment banking fees across markets and banking were up $746 million, and this is detailed on Slide 15 to $2.1 billion before the elimination of self-led deals. The combined Bank of America/Merrill Lynch franchise ranked 2 in global and U.S. investment banking fees in 2009. Now global markets, and you can see this on Slide 16, earned $1.2 billion in the fourth quarter, down almost $1 billion from the third quarter. Lower sales and trading results, combined with higher write-downs on legacy assets drove the decrease. As you can see on Slide 17, sales and trading revenue in the fourth quarter was $2.2 billion versus $5.3 billion in the third quarter. Now absent the legacy asset charges, or on a more business as usual basis, we saw $3.3 billion, reflecting the normal seasonal slowdown. Both fixed income and equity income declined, although rates and currencies and commodities within fixed income held up well. Lower market volatility, a reduction in risk appetite for customers, especially in the last couple of weeks of the quarter, and the normal seasonal slowdown contributed to the decline in revenue. However, we have seen a typical strong start to January on the back of a seasonally slow December. Non-interest expense was down 11% from the prior quarter due to lower incentive comp, and we detail on Slide 18 a number of the most pertinent legacy exposures in the capital markets business, and further detail is provided for you in the supplement. As I noted earlier, the charges we took this quarter were centered in the commercial real estate area, and from a legacy or pre-disruption asset standpoint, we remain the most focused on commercial real estate and monoline credit default swaps, as you might imagine. Now not included in the six business segments is equity investment income of approximately $800 million in the fourth quarter, due mainly to improved market valuations. In addition, on a consolidated basis we had security gains of approximately $1 billion, partially offset by impairment charges on non-agency RMBS of approximately $200 million. Now let me switch to credit quality, and that starts on Slide 20. We told you last quarter that we thought we were close to the peak in total net losses and it appears that that is the case. It feels to us like we are moving from stability to an actual improvement, but obviously given the weak economy we remain cautious. In the fourth quarter we saw improvement in almost all categories, including delinquencies, excluding our repurchases which I will discuss in a minute, losses and criticized levels. Consumer credit losses continue to show the flow through an improved early stage delinquencies earlier in the year in the unsecured lending portfolios and some stabilization in consumer real estate. Commercial portfolios reported lower charge-offs as a result of slowing deterioration and slightly improved asset valuations, although commercial real estate will continue to lag the consumer recovery. The rate of downward risk migration into criticized loans is clearly slowing. A fourth quarter provision of $10.1 billion exceeded net charge-offs, reflecting the addition of $1.7 billion to the reserve, which was lower than the addition of $2.1 billion in the third quarter. Consumer reserve additions were $1.3 billion and approximately $800 million related to increasing our reserve coverage on consumer credit cards to 12 months. About $550 million was added for card securitization that matured and came on the balance sheet during the quarter. We also added approximately $540 million associated with the Countrywide purchased impaired portfolio, and in consumer real estate loans, we increased reserves by $270 million. These increases were offset by reductions in other products where delinquencies continue to improve. Now on the commercial side we added $560 million for commercial real estate, primarily for non-homebuilder, and reduced reserves in small business by $280 million as credit quality continued to improve partially due to stricter lending criteria that we implemented earlier in the year. Our allowance for loan and lease losses now stands at $37.2 billion, or 4.16% of our loaned and leased portfolio. Our reserve front funded commitments is $1.5 billion, bringing total reserves to $38.7 billion. Now I will give you more details in a minute, but based on an estimated addition of $11 billion in reserve related to the adoption of FAS 166 and FAS 167, effective January 1 of this year, our credit reserve on a pro forma basis would be just under $50 billion, improving our reserve coverage of 4.16% by 60 to 65 basis points. Now on the held basis net charge-offs across almost all of our businesses in the quarter decreased $1.2 billion, or 42 basis points from third quarter levels to 3.71% of the portfolio, or $8.4 billion. On a managed basis, overall net losses in the quarter decreased $1.6 billion to $11.3 billion. Of the $1.6 billion decrease, the consumer decrease was 77%, or about $1.25 billion. Now even though loss rates were down this quarter, the loss rates are somewhat distorted by reductions in balances, so that's why I continue to talk in dollar terms. Credit card represents 54% of total managed consumer losses, and as you can see on Slide 22, managed consumer credit card net losses were $4.9 billion compared to $5.5 billion in the third quarter. Losses decreased due to a drop in early-stage delinquencies in the second quarter of 2009. If you couple that with the 180-day charge-off policy, you can see what drove the reduction. 30-day-plus delinquencies in consumer credit card decreased $541 million, the third consecutive quarterly drop, leading to the reserve actions that I mentioned earlier. Now obviously one quarter doesn’t make a trend, but we feel much better about the loss levels this quarter and if that they signal stabilization if not an improvement trend. Now a delayed recovery in the U.S. economy beyond our expectations or unforeseen events could obviously keep pressure on the performance. Credit quality in our consumer real estate business appears to have stabilized given that home equity charge-offs were down, even excluding one-time items in the third quarter. Now before I get into the individual consumer real products, let me remind you of a couple of important drivers, as I have the last couple of quarters. Total consumer NPAs, which are highlighted on Slide 23, increased $1.3 billion in the fourth quarter compared to an increase of $1.9 billion in the third quarter, and now total $22.3 billion. This is primarily comprised of consumer real estate with the lion's share being first mortgage. Now there are a number of things affecting this portfolio but as a reminder, we generally place consumer real estate on non-performing at 90 days past due and take charge-offs at 180 days, at which time we write the loans down to appraised value. We perform quarterly valuation refreshes, taking additional write-downs as needed. We also have troubled debt restructurings, or TDRs, which we explained last quarter that reflected as NPAs, even though most were not 90 days past due when the restructuring or modification was made. Now while our efforts are to responsibly keep borrowers in their homes and paying as we think that reduces the overall costs, the impact is that the NPA number is elevated. However, once a loan has been evaluated under all of our various programs, if no other alternatives exist, the loan will be released into foreclosure or charged down. Now our residential mortgage portfolio, and I'm on Slide 24 now, showed net losses of $1.2 billion, or 207 basis points, in line with the third quarter. 30+ delinquencies increase approximately $72 million before the impact of repurchasing delinquent government insured loans from securitizations, and that would be less than we would have seasonally expected. Repurchasing delinquent government insured loans from securitizations added $9.4 billion to the 90+ days delinquency levels, although they are still insured. We repurchased these loans for economic reasons, since we can finance them at a cheaper rate on the balance sheet and our risk exposure is the same, whether with a servicer or holder of these assets, since they are insured. Now on the non-performing asset front, we saw an increase of $1.2 billion, less than the $2 billion in the third quarter, reflecting the third quarter in a row of declining, new, non-performing loans in higher tiers. Of the $17.7 billion of residential mortgage NPAs, TDRS make up 17%. About 60%, or $10.7 billion of the NPAs are greater than 180 days past due and have been written down to appraised values, which is considered when we evaluate our reserve adequacy. Now I should also note that we saw continued stabilization in severity and improvement in the average size of charge-offs this quarter. Our reserve levels were slightly increased on this portfolio during the quarter and represent 1.9% of period end loan balances versus 1.87% in September. Now when we think the dollar loss level has most likely peaked, given the weakness in the economy and the continued pressure on home prices, we may see could see further deterioration in this portfolio. Now switching specifically to home equity, and I'm back on Slide 25, net charge-offs decreased $410 million to $1.6 billion in the fourth quarter. This is the second quarter in a row with decreases after adjusting last quarter for the accelerated charge off related to an adjustment to our loss severities due to the protracted nature of collections under some insurance contracts. The drop was a bit greater than we expected, driven by improvement in later-stage delinquency performance, so we are a little skeptical that we can hold at this dollar level, as prior to December we would have told you that we didn’t expect losses to peak until well into 2010. We will have to see how this one plays out, but don’t be surprised to see it bounce around a little before we see sustained quarter-over-quarter improvement. Now 30+ delinquencies were flat, again better than seasonal expectations. Non-performing assets in home equity, principally loans greater than 90 days past due were essentially flat at $3.9 billion. 44% of our NPAs were TDRs where we believe we have improved the likelihood of repayment. Just over 80% of the non-performing home equity loan modifications in the fourth quarter of ’09 were performing at the time of reclassification into TDRs. Now in addition, about 20%, or approximately $790 million of the NPAs were greater than 180 days past due and had been written down to appraised values. We increased reserves for this portfolio to $10.2 billion, or 6.81% of ending balances, and that is 5.29% excluding the purchased impaired loans due to further deterioration in the purchased impaired portfolio. On Slide 26 we provide you details on our direct and indirect loans, which includes the auto and other dealer-related portfolios as well as consumer lending. Net charge-offs in direct and indirect decreased 11% to $1.3 billion or 5.2% of the portfolio. We saw the expected decrease of about $184 million in consumer lending charge offs and expect that trend to continue due to the improvements in delinquent amounts. Slide 27 shows the details of the purchased impaired Countrywide portfolio, where charge offs were lower this quarter. Last quarter we added $1.3 billion due to continued deterioration. The addition this quarter of $540 million relates to further deterioration as well as a reassessment of modification benefits as we gain more experience with customers going through the modification process. Now as we did last quarter, we provided more details on the slide for you so I won’t go through that anymore. Looking forward, I would say this portfolio's valuation, and remember the purchased impaired portfolio is a life-alone reserved portfolio, is most sensitive to HPI and our success under the modification programs. We would also expect a lion's share of the charge-offs to come through in the next few quarters. Switching to our commercial portfolios, and you can see this on Slide 30, net charge-offs decreased in the quarter to $2.3 billion, or 278 basis points, down in dollar terms about 14% from the third quarter, or 7% excluding approximately $190 million in fraud-related losses in the third quarter. Net losses in our $18 billion small business portfolio, which are reported as commercial loan losses, decreased $112 million to $684 million compared to increases in the past quarter. Small business losses look to have peaked, as indicated by several linked quarter declines in 30+ delinquencies, as well as 90+ delinquencies which are down 11%. Now excluding small business, commercial net charge-offs decreased $249 million from the third quarter to $1.6 billion, representing a charge-off ratio of 205 basis points. The losses in the quarter were split 53% non-real estate, and 47% real estate. Within commercial real estate, net charge-offs decreased $128 million to $745 million, representing a charge-off ratio of 4.15%. Homebuilder losses constituted 37% of commercial real estate losses and were down 26% from the third quarter. Non-homebuilder losses were down 6%, reflecting decreases in multi-family rentals and commercial land, offset somewhat by increases in retail and office. Now we wouldn’t expect losses to peak in this portfolio until well into the year, if not near the end of this year. The losses will be a little lumpy and bounce around, so we don’t read much into the decline this quarter, especially given the non-homebuilder deterioration. Commercial NPAs, and this is detailed on Slide 31, rose $607 million, down 39% from last quarter to $13.5 billion. 84% of the increase was due to commercial real estate, driven by non-homebuilder exposures, namely retail, commercial land, multi-family rentals and multi-use. Homebuilders dropped again this quarter by 7%. Now let me give you some color behind the make-up of our commercial NPAs. Commercial real estate makes up about 60% of the balance, or about $8.1 billion, with about $3.2 billion or 40% being homebuilders. Outside of commercial real estate, NPA balances are concentrated in housing-related and consumer-dependent portfolios within commercial/domestic. The most significant of these industries are commercial services and supplies, and here think realtors, employment agencies, office supplies, etc. at 5% of the total commercial NPAs, followed by individuals in trust at 4% and media at 3%. No other industry comprised greater than 2%. Approximately 90% of the commercial NPAs are collateralized and approximately 35% are contractually current. Total commercial NPAs are carried at about 75% of original value before considering loan loss reserves. Now on a pretty encouraging note, reservable criticized utilized exposure in our commercial book actually decreased $1.4 billion in the fourth quarter compared to an increase of $2.9 billion in the third quarter and is the first decrease since 2006. This decrease reflected declines in commercial non-real estate, both domestic and foreign, offset somewhat by an increase in real estate. This increase in commercial real estate to $23.8 billion was driven mainly by increases in office, multi-family rentals and hotels and motels. Now as I mentioned earlier, we added to commercial reserves in the fourth quarter, of which almost all was related to commercial real estate. Total commercial reserve coverage at the end of December increased to 2.96% of loans with real estate coverage being 5.14%. Now let’s move off credit quality and talk about net interest income, and here I'm on Slide 34. Compared to the third quarter on a managed and FTE basis, net interest income was up $50 million. Managed core NII increased a little better than expected by approximately $140million while market-based NII decreased about $90 million. The core NII increase was driven by several factors, including less of a credit drag principally due to the improvements we saw in credit card performance; improved hedge results; increased deposit balances and the lack of a few one-time negative items in the third quarter. Now offsets were lower loan levels and some initial impact of not repricing for risk in the card book. The core net interest margin on a managed basis increased 7 basis points to 3.74%. In looking forward, remember we took down the discretionary portfolio during 2009, and also experienced paydowns. Loan demand has been weak and we would expect it to stay that way until business and consumer confidence improve, and as I just mentioned, we have lost some ability to reprice for risk in the card book. These factors would suggest we will see a decline in core managed net interest income this year from 2009 based on the current forward curve. Now also remember you always get a negative first quarter impact due to fewer days in the quarter. On the positive side, once we see the economy strengthen and rates begin to increase beyond what is in the forwards, we should see less credit drag, strong earning asset growth, and deposit cost benefits. To that point, our interest rate risk position continues to be asset sensitive, as you see from the bubble charts on Slide 35 where we benefit as rates rise and are exposed as rated decline. That position is relatively unchanged from how we were positioned at the end of September. Keep in mind these impacts are based off changes to the forward curve and are relative to our base forecast. Now while we remain cautious about the economy, we continue to believe an asset sensitive position makes sense, especially given the low absolute level of rates. Now let me say a few things about capital, you can see this on Slide 38. The Tier 1 capital ratio at the end of December was 10.4%, down 206 basis points from the third quarter, due mainly to our repayment of TARP. However, the equity rise rates associated with the TARP increased Tier 1 common 138 basis points to 7.81%, while our tangible common equity ratio increased to 5.57%. Now as a reminder, the appreciation above our current tiering value for Blackrock nor China Construction Bank is included in capital. Preferred dividends this quarter were $5 billion, of which $4.66 billion was associated with TARP, including the negative impact of repayment, or 54% per share per quarter given no tax benefit. Excluding TARP, preferred dividends during the quarter were $340 million, which is approximately the level we should experience going forward, and liquidity remains strong. Now since we raised significant amounts of equity and were quite active in the debt markets during the second and third quarters, we didn’t do any benchmark deals during the fourth quarter and as of December 31, 2009 our time to required funding metric, the amount of time that the parent company can meet its debt obligations without new issuance was 25 months. Unsecured long-term parent company debt maturities in 2010, including those from debt at the legacy Merrill Lynch and Company holding company will be approximately $46 billion spread out over the course of the year and we will continue to be opportunistic in assessing the debt markets in 2010, but probably will not match maturities given our funding base and the asset levels. Now impacting both capital reserves effective January 1, 2010 will be the adoption of FAS 166 and FAS 167 as I referenced earlier, and I am on Slide 40 now. As most of you know, this involves the consolidation of certain assets that are currently carried off the balance sheet. In short, an adjustment will be made to the first quarter to the balance sheet that increases assets and the allowance for loan losses, and decreases capital for the allowance increase. Other than geography, there is no impact to P&L. Currently our best approximation is the net incremental increase in assets of approximately $100 billion, the largest component of this amount is a net increase of $67 billion due to consolidation of the credit card trust, comprised of a $90 billion increase in credit card receivables, less securitization assets already on our balance sheet and an increase in the allowance for loan losses. Other components to the increase include $5 billion of home equity receivables and approximately $28 billion from consolidation of other special purpose entities including our multi-seller conduits. Risk-weighted assets are currently expected to increase only $14 billion as many of the credit card assets were already included in our calculation. Also, remember we have a deferred tax asset limitation for Tier 1 so the full reserve charge pretty much hits capital. The additional allowance for loan losses is expected to be approximately $10.7 billion; $10 billion for credit card and $700 million for home equity, while the impact to regulatory capital is expected to be a reduction of approximately $10 billion, including the deferred tax limitation. Tier 1 and Tier 1 common impact is expected to be a reduction of approximately 70 to 75 basis points while the impact to tangible common is expected to be a reduction of approximately 50 basis points. These estimates are on a fully phased-in basis. The bank regulators have made optional a phased-in approach but the benefits aren’t very big. Now this is a little heavier than we previously indicated due to the change in our credit reserving policy for credit cards that I mentioned earlier, and a change in the capital rules affecting our conduit. Now as the credit card loans come back on balance sheet, we are reserving at 12 months which increased the impact of adoption on Tier 1 by about 15 basis points. We can also now drop the held versus managed discussion, and you can see this back on Slide 7, the impact of bring card securitizations on the balance sheet in 2009 would have added $9.3 billion to net interest income, $2.1 billion to non-interest income and increased provision or charge-offs by about $11.4 billion. Again, the impact nets to zero but the geography changes. And as a reminder, we will issue $1.7 billion in common stock to associates as part of year end compensation, and $3 billion through the sale of assets which will increase capital. Looking ahead to 2010 and in line with my earlier comments and Brian’s remarks, we believe we are past the peak in total credit costs which is great news for us. I believe 2010 will be a tale of two periods, the first being gradual improvement in the economy and the second being a more significant improvement in consumer and commercial activity. Now during the first period we believe we will see slow but continued improvements in overall credit quality with provision of charge-offs dropping after adjusting for the impact of FAS 166 and FAS 167, but this is obviously dependent on continued improvement in the economy. Now even though the economy appears to have stabilized, the ultimate level of credit losses and reserve actions will be dependent on whether the stabilization is sustained, as well as the duration of the credit cycle. But as Brian mentioned, assuming future economic performance is consistent with our outlook, we do believe significant reserve additions are over, however certain segments in the commercial area are still deteriorating and probably won’t stabilize or turn until late in the year at best. There will probably be continued reserve additions for at least six months in commercial real estate and some lingering reserve additions in residential real estate. Revenue levels at best will be volatile as the headwinds of a shrinking loan portfolio, the card act, Reg. E, and higher mortgage rates; more specifically, the card act will manifest itself throughout the year in net interest income, as the act impacts our ability to risk-based repriced credit cards, and in card income due to restrictions imposed on certain fees. Overall after mitigation strategies, we still believe the impact will be some $800 million after tax related to consumer credit card in the U.S. We felt a little of this in the fourth quarter, but it will ramp up in 2010. Likewise, we believe Reg. E will impact service charges starting in the middle of the third quarter of 2010 for changes beyond those we instituted in 2009. We are still sizing the impact net of mitigation and how we think customers will behave and consequently we will provide more guidance in the future. Offsetting these headwinds should be lower provision, expense control and potential growth in other businesses like investment brokerage services, investment banking, trading and commercial banking, but again this is heavily dependent on market recovery. Whatever the scenario, we believe we are positioned quite well to take advantage of whatever the global economy offers. Now much of our performance will correlate with the domestic economy but will also be influenced by the global economy. With that, let me open it up for questions and I thank you for your attention.

Thank you, sir. (Operator Instructions) Your first question comes from Glenn Schorr – UBS. Glenn Schorr – UBS: Hi, thanks very much. So the deposits have been pretty good, all things considered. Can you give us a little clue on what you are doing on the asset side, as there are obviously limited loan demands and your capital and liquidity ratios are pretty good. Joe L. Price: Well Glenn, obviously the asset side is correlated to the economy, so you are correct, we are seeing a downdraft clearly because of just charge-offs, but loan demand is still weak. We are beginning to see, quite frankly, in some of the commercial regions a little pick up in the pipelines, but I call it little and early. But you are beginning to see a little bit of that. The consumer businesses continue to have decreases and probably will again until you see a little more consumer confidence come around. It kind of leaves us with the discretionary portfolio. I mean, we did add to the discretionary portfolio through securities this quarter some, but we have to remain reasonably cautious about where the curve is at this time, so you did see some of that come in but we will be very measured as we do that going forward. Brian T. Moynihan: Glenn, I think the simple way to think about it is as the economy continues to improve, you will see better fundamental loan demand and the issue before that is we are going to reflect the economy. Glenn Schorr – UBS: I don’t want to put words in your mouth, but is it fair to say really short, really high quality for now on the securities portfolio? Joe L. Price: Well, we’ll add some – I mean we did in this quarter. We added some with long durations, mortgage-based stuff but we also added some shorter duration. But if you think about the prepayments occurring in the mortgage book and in the other longer duration assets that are going off, so we have some ability to replay some of that without giving us too much OCI risk, if you want to think of it that way. Brian T. Moynihan: But high quality. Joe L. Price: High quality, yes. Glenn Schorr – UBS: I apologize if you disclosed and I just missed, but do you give the duration of the securities portfolio, average duration? Joe L. Price: I think by the time the Q comes you will see the detail. Glenn Schorr – UBS: Got it, okay. Maybe this is somewhat related. Bank of America has a decent amount of debt coming due over the course of the next 12 to 18 months, but you also have capital and liquidity and the balance sheet to come in a little bit. Can you just talk about your expectations on the funding side? Joe L. Price: : Overall debt issuances? Glenn Schorr – UBS: Overall debt issuances, yes. Joe L. Price: As I mentioned before, given the liquidity base and given the asset side of the balance sheet, don’t expect us to replace maturities completely. Now we need to stay active and we will stay active and there is some attractiveness to the rate environment from that standpoint, but the way you should look at it is if you go back in my remarks you will see we gave the actual numbers of what is coming due, we will continue to let some of that drift down as opposed to full replacement. Glenn Schorr – UBS: I don’t know if there is much you can say, in the prepared remarks you told us that the [Restin] warranty charge was a little bit higher, but there seems to be a mounting concern that those numbers start to add up. Is there any help you can give us in terms of sizing the amount of claims against you from the various parties? Joe L. Price: Obviously I don’t want to go into the detail on specific clients or customers or insurers from that standpoint, but think of it – and we have kind of gone through this not recently, but some of the earlier days right after the acquisition of Countrywide – there are several buckets. There are claims that come back from the GSEs, there are claims that come back from purchasers of loans, think of that as a private transaction, and then there are monoline wrap things. We continue to work each of those based on the claims that are presented. I would be disingenuous if I didn’t say people were throwing everything over the wall they can because they are, in a view of trying to get something back. Look, this is a loan by loan detailed review of the facts and circumstances, whether it is curable, whether the loan has been performing for an extended period, all the practices and those things, and we reserve for it on a FAS 5 basis. Think of it as quarterly we book in the hundreds of millions of dollars kind of number, which is, I think I have mentioned before, netted against the production income, and we will continue to do that. Look, this is not a quick kind of process. This is a multi-year extended process looking at individual credits. Glenn Schorr – UBS: And I appreciate that answer. As you go through it and as you start to have some experience on where replacements are needed versus cases you win, does that give you a good enough window into the future to be boosting reserves other than what the current feeling is? In other words, you don’t disclose to us what the size of the past origination in sales in question are or the reserves are, but people basically want to get a feel from you of whether or not you feel you are well-enough reserved or if this is going to be a persisting and mounting issue over the coming eight quarters. Joe L. Price: Look, I think the way to think about it is Countrywide had a reserve. We adjusted that in purchase accounting, we have been adding to it quarterly or dealing with it quarterly with the expenses each quarter since then and we will continue to manage it that way. Yes, we do get more experience every quarter as we go through the individual loans. Remember though we have had some pretty tough consumer real estate portfolios that have been wrapped by insurers. We exited a business back in ’01 that we went through some of the same kind of exercises with, so the same team that did those workouts which I might add continue today from back then, and that is what I was talking about, the protracted nature of how this process works. They are the ones on it so we do have quite a bit of experience in how to estimate on a FAS 5 basis and I would only characterize the reserve that we are carrying as in the billions, so we feel pretty good about where we stand. Look, we will continue to get claims and we will continue to work through it and this doesn’t go away overnight. Glenn Schorr – UBS: Thank you very much.

Your next question comes from Matt O’Connor – Deutsche Bank. Matt O’Connor – Deutsche Bank: First on the credit side, Joe you provided a lot of comments regarding specific loan buckets. It seems like some are trending up still, a number aren’t reflecting here. As you think about total charge-offs on a managed basis heading into 1Q, do we get a little pick up overall and then it starts to trend down from there? How should we think about the managed charge-offs quarter to quarter? Joe L. Price: Matt, you have to go back and think product by product because as I mentioned before, commercial real estate, especially non-homebuilder, will be somewhat lumpy and episodic. Other components of the commercial side, especially small business, feels like it is on a downward trajectory. Core domestic, as you saw the reservable criticized drop is an indicator that things feel more stable in that side, but obviously they are economic dependent. On the consumer side, again I would tell you to go back and look by product. Card we saw pretty good change; we have seen probably a little more drop in delinquencies but not quite at the same pace of the drop earlier, so that ought to factor into your thinking. And then on real estate we feel pretty good about the levels that we are experiencing, but as I said in the comments, home equity is probably doing a little better than we might have expected so it wouldn’t surprise us to see that bounce around. And then the foreclosure market or the houses coming on the marketplace potentially have an effect, although we feel we have got that as considered as we could given the knowledge that we’ve got. Brian T. Moynihan: I think we’ve said that they remain elevated. I think you have to be careful about the speed at which the recovery works through the portfolios in terms of quarter to quarter linkage, but the overall balances in the most troubled portfolios have come down and the overall progress the teams have made in the collection effort is better, so you have to keep that in balance because I know the underlying economy is still not healed and unemployment is still high. Matt O’Connor – Deutsche Bank: Brian, a bigger picture question for you. We have seen you made a couple of changes to the senior management team. So as we think about the core businesses, any meaningful changes or deeper dives that you are taking now in terms of the products, the way you deliver to customers or even the customers that you are targeting? Brian T. Moynihan: The business model is sound. In other words, the core customer bases on the consumer side, whether mass market consumers and high net worth and affluent consumers and then the small business, medium business, large business and then the investor community, that business model is sound. Intermediating for our corporate clients to the investors, so don’t look for us to make any changes. We’ve got a couple of dispositions we have to make but in terms of the core business model it is sound, it operates, the market shares are there. It is just taking this massive customer base and taking the product capabilities and putting them together in better and better ways and driving it, whether it is the company or whether it is an individual. So don’t look for any major changes. Matt O’Connor – Deutsche Bank: As a follow up, in terms of the size of the balance sheet, given that you are adding some securities here it seems like you are comfortable with the overall size, plus or minus? Joe L. Price: It will bounce around. We are talking about, across our large balance sheet, we are talking about relatively minor adjustments so it will bounce around. There is no need to – we have enough room to grow the core loans when they start to grow based on where we are, but don’t expect it to move dramatically either way. Matt O’Connor – Deutsche Bank: Thank you very much.

Your next question comes from Ed Najarian – ISI Group. Ed Najarian – ISI Group: Good morning, guys. A quick question on capital ratios. Given the changes you outlined with regard to 166 and 167, and then obviously indicated continuing to build capital ratios with the common stock issuance and the $3 billion asset sale, that still seems like it is going to bring us a little bit short of the 8.5% Tier 1 common ratio that you talked about when you did your equity offering. Have you had any follow up discussions with the regulators as to where capital ratios need to get into 2010 in light of your new outlook on 166 and 167? And should we think of the capital actions that you have outlined for 2010 as all that is required or could there be more that is required? Joe L. Price: Look, we don’t talk specifically about conversations with regulators or can’t, so think of it more as the way we look at the company that we manage. We are pretty much in line with our expectations of capital now. Clearly when we made the decision here in closing the books to change the reserve level coverage for card that had an impact compared to the pro forma that we would have shown you that was purely based on 9/30. The outlook on capital, you have a lot of things coming at you. You have the market risk rules, you have the Basel II pieces, you have the – I call it the December 17th proposals. A lot to work through over time. In the near term we think all of those are manageable and considered in the way we look at capital and how we came up with what we felt comfortable with in the raise from that standpoint, obviously supplemented by these few things still to get executed. At this point, no major contemplation of any other actions other than those unless something falls out, as Brian said, as we look at the aggregate company for things from that standpoint. Ed Najarian – ISI Group: So until we see some kind of additional clarity from regulators on capital ratios you wouldn’t expect any additional actions other than the things you have already outlined? Joe L. Price: Not at this point. Ed Najarian – ISI Group: A housekeeping/mapping question, when we look at the Merrill Lynch structured note loss, I am assuming that is in your income statement in other income and the marks are on legacy assets as a net against trading account profits? Is that correct? Joe L. Price: Yes to the first part, the second part it kind of depends. Some of that will be in other also.

Your next question comes from Betsy Graseck – Morgan Stanley. Betsy Graseck – Morgan Stanley: Thanks. On the NPL loans that were discussed earlier, could I understand how you think about what kind of NPLs should fall out of these loans that you are buying? Are these all going NPLs? Is the rate 100% NPLs? What kind of experience have you had? To what degree are you reserving for these as you buy them versus as they perform relative to expectation? Joe L. Price: Are you talking about the insured loans that I referenced in the delinquency numbers? Betsy Graseck – Morgan Stanley: Yes. Joe L. Price: Think of those as government-insured, so they are performing past due, not non-performing past due, so what I was trying to do is if you pull our delinquency stats or if you look at them you will see a pretty big jump in the 30 and 90 and first mortgage past due performing, and I didn’t want you to get misled by that so I was simply explaining what that was. So those are insured so they would, in theory, not carry a reserve. Obviously when you look at our reserve coverage numbers they are in the loans and so they, in essence, distort that a tad, but in the grand scheme of things it is not that big. Betsy Graseck – Morgan Stanley: Right, because you expect the insurance to pay. Joe L. Price: Yes, these are FHA type. Betsy Graseck – Morgan Stanley: On the loans that you are buying from private investors that might not be wrapped, same kind of question. Are you reserving at point in time of purchase, are you reserving as they perform relative to your expectations? Joe L. Price: You mean basically a rep and warranty question on a whole loan? Betsy Graseck – Morgan Stanley: Correct. Joe L. Price: Few and far between. If you think about the hierarchy of reps and warranties, think of them as quite frankly, they are probably the clearest in GSEs, monolines and in private sales the reps and warranties generally by this time are somewhat unenforceable, not from a data standpoint but just from a lack of time and they have run out. I wouldn’t put that one on your radar screen. Betsy Graseck – Morgan Stanley: And then you discussed the coming capital actions which will add to common Tier 1 like the issuance of stock and the asset sales that you are anticipating as well as warrants? I think there are some warrants outstanding in the money. Can you give us some sense as to whether or not that is going to be action that you take this quarter? Joe L. Price: The warrants, you are talking about the ones associated with TARP? Those are warrants that I think we said in the press release when we did the TARP announcement and the payback that we did not intend to repurchase those, so those presumably would be sold by the government. When they are ready to do that we have certain registration activities we have to go through to help them do that, but they will do that at their own call. You wouldn’t see a capital impact of that, obviously, until those were either exercised or some kind of occurrence by whoever ultimately holds those. The other asset sales clearly that we have committed to increase the capital by $3 billion, that process we are underway in a review consistent with what we talked about before to identify the appropriate either businesses and/or discretionary assets to make that claim. Those are the real two big things. Brian T. Moynihan: So the simple thing on the government warrants is it won’t be any capital hit to us because they will be in someone else’s hands. Betsy Graseck – Morgan Stanley: Some of it is in the money, so I am just surprised that the actions haven’t started yet. Joe L. Price: The Treasury hasn’t sold them, per sae. Once they sell them and if they are in the money and if someone wants to exercise them. In other words, it won’t be triggered by us, is the point. Betsy Graseck – Morgan Stanley: I understand that. Brian, can you give us a sense of how you are going to be managing your team? What are the marching orders that you are going to be delivering to your group? Is it more top line, bottom line, market share, net new business? Can you give us a sense of your priorities? Brian T. Moynihan: If you look across the businesses, they have different priorities. Obviously in Sally and Tom’s area the top line is there to get and they have to drive at that so they are going to drive more of a top line driven with expenses matching on a rational basis. If you look on the consumer side, Jill and Barbara and the teams below them, that is more matching – really we are so big in the consumer business so the revenue growth will be measured in matching good expense management capability and really dealing with, in both card and deposits, the changes and trying to figure out ways to recover some of those changes either through deposit pricing or other ways. So the challenges are different, but the way I am going to drive the team is consistent. We will recognize the opportunities and challenges and drive the business to the six or seven major businesses and customer groups along differentiated lines and carefully driven. But we as a company will be grinding through, because of our size, revenue that will not outdistance the economy by a lot just because we are so big and we have to be realistic about what that means in managing expenses and the businesses. Betsy Graseck – Morgan Stanley: Would you think about coming to the market with some goals or targets that you are going to be assessing your management team against? Brian T. Moynihan: We will, and I think really as we get into the first quarter and go through that. This call is about last year’s fourth quarter so I am working with the management team now and so expect that as we get into some of the analyst conferences and the earnings for the first quarter. Betsy Graseck – Morgan Stanley: Lastly on the CFO search, just give us a sense of your timing on that. Brian T. Moynihan: As soon as possible. Betsy Graseck – Morgan Stanley: But I mean, obviously there are folks internal to Bank of America who I would think are in the running as well. At what point do you cut off the external search? Brian T. Moynihan: Our intent is to go external and so the process has already started and the list of candidates are being approached. Stay tuned, but this is obviously a key hire for us as a company. Betsy Graseck – Morgan Stanley: Anything in particular you are looking for? Brian T. Moynihan: Someone who is good.

Your next question comes from Paul Miller – FBR Capital Markets. Paul Miller – FBR Capital Markets: Thank you very much. Brian, last year Ken Lewis talked about a pretax pre-revision number of around $45 billion for 2009, which you basically came in at $45 billion, $50 billion number. We know it is very volatile, but can you give us any guidance of where you think that number is going to shake out in 2010, and does it change now that you bring on the managed credit card portfolio, and how much does it change by? Brian T. Moynihan: I will give you the guidance, what we see in the fourth quarter which is on the fourth or fifth page in here, but we are not going to give guidance about that for 2010. I think the question of whether your view or other analysts’ views of how you included the managed versus the non-managed presentation I think is something that will shake out here, so Lee and Kevin and others will make sure people see how the 167 etc comes through. I think all of you should make sure we understand that because there is a major difference in the card business contribution that way. Overall, frankly though, in the card business remember that we will bring, over time and periods of time that charge will come down. That business will always have – it is big, and a charge-off rate that approaches the normal environment will still be… you can’t discount it. There will always be a relatively large dollar amount of charge-offs even in good times going through that business just because of the nature of it. I think that with your sophistication, as you look at this, you bring the managed in and then you will figure out a normalized basis. A long answer to say we won’t put that on the table for 2010, but clarity on guidance on how managed works we will give you. Paul Miller – FBR Capital Markets: Can you just touch base on your cash position? You were about $120 billion, it is something a lot of people are looking at and hoping you can bring this back into the portfolio at some point and get a decent spread on. Or is it something that the regulators – I know you don’t want to talk about regulators per sae, but you saw the Basel white paper that talked about banks should have to hold a lot higher liquidity. Is that something you are preparing for with this $120 billion of cash plus? Or do you think you can bring that back in and deploy that on the portfolio at some point? Joe L. Price: Look, we probably don’t think of it just as cash because we think of it more as how do you manage the liquidity and the liquidity can be redeployment and highly liquid securities that have withstood these kind of downturns, so there is an opportunity to manage it from that standpoint. If you look at what we have done here recently, clearly the payoff of TARP net of the equity raise was a use of cash but we have also seen wholesale funding come down as retail deposits have gone up. We’ve let the debt footprint run off a little bit and we have redeployed some, as I referenced earlier, in securities. But clearly the balance sheet is not the way it was at one time, if you look at all the combined entities. Going forward I would probably say I don’t focus, again, as much on the individual line items as I do the overall liquidity. You are correct that the world has changed and I don’t think anyone is going to run the kind of liquidity levels you saw before the disruption, so we will have elevated liquidity, but don’t think of it as having to stay in cash, is probably the best way to think about it.

Your next question comes from Jefferson Harralson – KBW. Jefferson Harralson – KBW: Thanks, good morning. I was going to ask you about your loan modification experience and recidivism rates I see in your non-performing asset activity there is a large decrease in the return to performing status in your consumer loans, that went from $1 billion to roughly $2.2 billion. Can you talk about what drove that number, a large increase of return to performing status and your experience with loan loss and recidivism rates? Joe L. Price: We tried to give you – and this wouldn’t be all loans, by any means – but we tried to give you the TDR numbers. If you are looking at the slide package at both home equity and first mortgage, we try to give you the experience of what is paying to modified terms so you can actually see that. We feel pretty good about it. Think of those as having to be six months of performance either leading up to the modifications, they would have been current leading into it or if they are put in non-performing or had been on non-performing they will have to have six months of performance before they actually go. So think of the stats I gave you in those two slides as being indicative of our view of a big subset being the TDRs, and then I think on an overall basis we would say that the modifications done over the last few quarters probably will have better reperformance than those done early on, because the early on ones – especially, let’s call it early on in ’08 may not have had quite the level of borrowers embedded in them, so I think it will get better over time, is the way we are looking at it. Jefferson Harralson – KBW: A similar question on the commercial side. Are you seeing the interagency white paper on change ahead when you look at commercial real estate, more focused on cash flows versus appraisals? Are you seeing that have an impact on how you look at non-performers or the info on new NPLs? Joe L. Price: No, not given the cash flow lending view that we’ve always had, it really doesn’t change our view.

Your next question comes from Michael Mayo – CLSA. Michael Mayo – CLSA: Good morning. One real factual question, and then a real conceptual question. The factual question is, what is the line utilization for your commercial borrowers? Joe L. Price: Stayed at about – I think bounces in-between 57% and 58%, stayed there this quarter compared to last quarter so we have seen stability in that line. Michael Mayo – CLSA: 57%, 58%? Joe L. Price: Yes. Michael Mayo – CLSA: And wasn’t that close to the all-time low though? Joe L. Price: Yes. We are in that trough, but it has kind of leveled in that trough as opposed to continuing, is the way to think about it. Brian T. Moynihan: Mike, just on the specific percentages because it can be different, but the point is that commercial clients are drawing at the lowest levels we have seen in a long time because they just don’t have the demand, and that is something that has stabilized but that is where they sit. Joe L. Price: Stabilized low, basically. Michael Mayo – CLSA: But you are willing to offer them the loans, they just aren’t borrowing? Brian T. Moynihan: They have the capacity to borrow, on the borrowing restrictions and they have to build inventory receivables and stuff to actually get the capacity, but the structure is there for them to borrow if they had the demand. Michael Mayo – CLSA: Why do you think they are not borrowing? Why don’t you think the demand is there? Brian T. Moynihan: I think they are looking at the economy, when we talk to them they are looking at the economy the same way we are, saying it feels better but until I see some fundamental demand build up, I am not going to hire or build up inventories in expectation of sales. Now the global companies are a little bit better because the international piece is a little stronger, but they are just cautious. They are cautious on employment levels, and they have done a very, very good job as a group to get themselves underneath this economy and they are not going to blow it now, so they are being very cautious. Michael Mayo – CLSA: And then the big picture question, Brian, there are a couple of questions in this direction, but when I think of Hugh McCall in the ‘90s he wanted to build the biggest bank in America, that was his goal. When I think of Ken Lewis last decade, he wanted to create one of the most optimized banks and the most efficient banks. As we think about what you want to achieve in a big picture sense, are you able to articulate really what you want to achieve, or will that take some more time? Brian T. Moynihan: I think from a broad basis, the mission will be to be the best financial services firm in the world and balance between the goals of Hugh and Ken and others which is we have to make sure that we really do a great job with the customers and clients overall in consumer, that is a little difficult because the economy It’s a balance between the customers and the associates and the shareholders. So it is not a different thing, it is just that we are at a point where we don’t have to think about, do we need a product or service? We are just at the point where we have to execute. I know that sounds simple to say. It’s hard to do. But it is absolutely critical and it will generate a lot of cash out of this franchise as the economy recovers. Michael Mayo – CLSA: And then last follow-up, the balance between customers, associates and shareholders. Is that balance changing? Is it changing so much it might hurt your ability to compete? You might add a fourth category, the government, a regulator. How is that balance changing? Brian T. Moynihan: If you think about the industry, we are adjusting to this, the Reg E changes and the card act and so as those questions come in we have to figure out, our job is to figure out how we are going to get you a good return on your capital and your investment given those challenges. We have very bright people, we have very good franchises, a great customer base. It is not going to be an insurmountable hurdle, but the rules have changed and we have to take that into account. But the beliefs and that, that is because customer behavior has changed and the impact on some of the things we did over the last 10 years on the customer didn’t come out the way they did in tougher economic times and we have to reconfigure them. Michael Mayo – CLSA: We will go next to the site of John McDonald – Sanford C. Bernstein. John McDonald – Sanford C. Bernstein: What are your opportunities for expense leverage in 2010 and beyond? Joe, is the fourth quarter expense a good run rate for 2010? Could you remind us what kind of cost saves you might have incrementally from that run rate? Joe L. Price: I think I mentioned that we had some heavy litigation costs. Remember in the third quarter we had the wrap costs to exit the proposed wrap, so that is one item that is floating in there. You also had some continued leverage coming out of the acquisitions but quite frankly we got more this year out of Merrill Lynch’s expense base than we might have anticipated, and until the systems changes come, think of them as later next year rather than earlier, you might be at a run rate here for a few quarters on expense saves that doesn’t take another leg up until a little bit later into next year. Also, obviously you have let’s call it revenue-driven expense items. So Tom’s business and others that were down this quarter would have had a lower expense component compared to that. It goes back to Brian’s point about how we are managing those business and which ones we are pushing. But those are all the dynamics working on this. Obviously remember Q1 always has this weird animal with FAS 123-R that will blow us out, but that will be elevated with a larger markets platform this year, this year being 2010. Things of that nature. So that is the backdrop you are working under. To the point of the individual businesses, if you go back to Brian’s comments about how he is managing the company, clearly on some of the businesses there we will be looking for very tight expense control given the dynamics of the revenue side. Others, hopefully will drive revenue up that will have expense growth associated with it from that standpoint. So I think you have a reasonable base if you take those things into consideration to work with. John McDonald – Sanford C. Bernstein: Do you have any color on the comp ratio in the investment bank in the fourth quarter, and any impact from changes in the mix of compensation between cash and stock? Joe L. Price: I think you should think of us as migrating towards the Bank of America policy which traditionally would have had a heavier deferred component than maybe the Merrill one at certain times in their history. Think of the add on this year, although it is all expense in the current year for the TARP repayment contribution by the associates being $1.7 billion, that would be an added on top of your normal comp payout deferred portion versus current. Now they are entitled to that stock, day one, so you expense it but you can’t transfer it until later from that standpoint. That would be the way to think about the mix. In terms of the ratios, we don’t give the specific ratios for just the markets business. You can look at Tom’s individual business line but you have to remember part of the investment bank was in the banking group. We don’t give the specifics for that particular unit. John McDonald – Sanford C. Bernstein: A quick review of the puts and takes on your margin outlook. What are the sources of incremental downside pressure you mentioned going into 2010 and don’t you have some offset from maybe a relief of interest reversals as we get out further? Joe L. Price: Well, we actually have not had this quarter – that was one of the items that drove us to a little better than expected performance this quarter in the margin. I would say the credit drag on the margin dropped by about $1.5 billion. Think of it as closer to $1 billion this quarter and it was about $1.15 billion – I am rounding, but generally speaking. That will continue to abate as credit quality gets better, although you may have seen, just talking about charge-offs, you may have seen a bigger improvement in cards last quarter if you just tracked delinquencies than you might see here going forward, at least in the near term. That will be a positive. We have lower loan levels, flat out, and some of those are in the higher margin levels, we have a lower discretionary book year over year again, as opposed to linked quarter. That will have a drag on us. And then the repricing of risk in the card book will be something we have to manage through. On the other side though, clearly as we move into a higher rate environment you see the benefit of our deposit base flip from stability which is how you see it today to lower funding costs coming out of this thing, so that is a positive clearly as the economy begins to recover you get the loan growth back and all of those other factors and we will be able to reassess the discretionary side as we come into more strength in the economy.

Your final question comes from Moshe Orenbuch - Credit Suisse. Moshe Orenbuch - Credit Suisse: If you could give a little more color about how the actions you have taken in terms of loan modifications and other forbearance have affected charge offs now and how you think that pattern might be reflected in the next couple of quarters, and how we should think about that with respect to the reserve over the first half or several quarters of 2010. Joe L. Price: Look, I think on the charge off side, modification as I have referenced earlier, you have to have subsequent performance to keep them from continuing deteriorating from a delinquency standpoint. So I would say that on the affects they have had on actual charge offs are where we have had actual performance that kept them out of those buckets that would roll into the charge off delinquency status. It is hard to theorize on had we not made the modification exactly how many would or wouldn’t have gone, so that is a difficult thing to view. From a reserving standpoint, you are correct. You saw the action we took on the impaired portfolio, part of the charge this quarter was a reassessment as we’ve gotten more familiar with customer behavior, i.e. how many customers actually take the modification, how many of them get flushed again through the system, get to the real people that need them. So that is one of the reasons you saw us take reserve action there. We are probably carrying a little more reserve in a couple of the other consumer real estate products in anticipation of continued, some level of re-default in our projections and things like that. So that is the conceptual way, but I don’t have any numbers to put around it for you. Moshe Orenbuch - Credit Suisse: But it seems reasonable that – I don’t want to say excess reserves – but that the reserves have certainly at least built in for that activity and to the extent it isn’t worse then there should be, at worst, adequate reserves and potentially some excess to be recovered. Joe L. Price: Subject to the economy, and subject to any other rule changes that might come out, I guess is the way to think about it. Brian T. Moynihan: Thank you everyone and we will see you next time.