The year-ago quarter included $1.3 billion of negative DVA and FVO adjustments, $1.8 billion of total litigation expense and a $0.6 billion goodwill impairment charge in the European consumer card business. In addition, the year-ago quarter included, among other significant items, a $2.9 billion pretax gain on the sale of a portion of the company's investment in China Construction Bank (CCB), a $1.2 billion gain on the exchange of trust preferred securities, and a $1.2 billion gain on the sale of debt securities.
Relative to the year-ago quarter, the results for the fourth quarter of 2012 were driven by improved credit quality across most major portfolios, increased sales and trading revenue (excluding the impact of DVA E), increased investment and brokerage income, higher investment banking fees, partially offset by an increase in consumer real estate losses, reflecting the Fannie Mae settlements and the provision for the IFR acceleration agreement. In addition, noninterest expense declined from the year-ago quarter, driven primarily by cost savings achieved through Project New BAC initiatives over the course of 2012.
"We addressed significant legacy issues in 2012 and our strengths are coming through," said Chief Financial Officer Bruce Thompson. "Capital and liquidity remain strong and credit continues to improve. Our primary focus this year is to grow revenue, manage expenses and drive core earnings growth."
Selected Financial Highlights
|Three Months Ended||Year Ended|
|(Dollars in millions, except per share data)||December 31 2012||December 312011||December 31 2012||December 312011|
|Net interest income, FTE basis 1||$||10,555||$||10,959||$||41,557||$||45,588|
|Total revenue, net of interest expense, FTE basis||18,891||25,146||84,235||94,426|
|Total revenue, net of interest expense, FTE basis, excluding DVA and FVO 2||19,610||26,434||91,819||90,106|
|Provision for credit losses||2,204||2,934||8,169||13,410|
|Noninterest expense 3||18,360||18,941||72,093||77,090|
|Goodwill impairment charges||—||581||—||3,184|
|Diluted earnings per common share||$||0.03||$||0.15||$||0.25||$||0.01|