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The Business Model of
BANK OF AMERICA
Created by John J. Maxfield, The Motley Fool
Traditional Bank
$23.8 billion1
Bank of America operates three businesses, the largest
of which is a traditional bank that...
Consumer
72%
Traditional Bank
$23.8 billion
Most of the traditional bank’s earnings come from
serving consumers, who accou...
Consumer
72% Commercial
28%
Traditional Bank
$23.8 billion
The other 28% comes from serving commercial customers.
Consumer
72% Commercial
28%
Traditional Bank
$23.8 billion
Investment Bank
$10.5 billion
Bank of America’s investment bank...
Consumer
72% Commercial
28% Trading
36%
Traditional Bank
$23.8 billion
Investment Bank
$10.5 billion
The plurality of B of...
Consumer
72% Commercial
28% Trading
36%
Advisory &
Underwriting
28%
Traditional Bank
$23.8 billion
Investment Bank
$10.5 b...
Consumer
72% Commercial
28% Trading
36%
Advisory &
Underwriting
28%
Traditional Bank
$23.8 billion
Investment Bank
$10.5 b...
Consumer
72% Commercial
28% Trading
36% Interest
& Other
25%
Advisory &
Underwriting
28%
Traditional Bank
$23.8 billion
In...
Consumer
72% Commercial
28% Trading
36% Interest
& Other
25%
Advisory &
Underwriting
28%
Traditional Bank
$23.8 billion
As...
Consumer
72% Commercial
28%
Merrill Lynch
83%
Trading
36% Interest
& Other
25%
Advisory &
Underwriting
28%
Traditional Ban...
Consumer
72% Commercial
28%
Merrill Lynch
83%
U.S. Trust
17%
Trading
36% Interest
& Other
25%
Advisory &
Underwriting
28%
...
Consumer
72% Commercial
28%
Merrill Lynch
83%
U.S. Trust
17%
Trading
36% Interest
& Other
25%
Advisory &
Underwriting
28%
...
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The Business Model of Bank of America

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I made this slideshow for anyone curious to learn how the $2.2 trillion Bank of America makes its money.

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The Business Model of Bank of America

  1. The Business Model of BANK OF AMERICA Created by John J. Maxfield, The Motley Fool
  2. Traditional Bank $23.8 billion1 Bank of America operates three businesses, the largest of which is a traditional bank that accepts deposits and makes loans. 1. All revenue figures relate to the first six months of 2015.
  3. Consumer 72% Traditional Bank $23.8 billion Most of the traditional bank’s earnings come from serving consumers, who account for 72% of its revenue.
  4. Consumer 72% Commercial 28% Traditional Bank $23.8 billion The other 28% comes from serving commercial customers.
  5. Consumer 72% Commercial 28% Traditional Bank $23.8 billion Investment Bank $10.5 billion Bank of America’s investment bank is its second-largest business, accounting for $10.5 billion in net revenue through the first six months of 2015.
  6. Consumer 72% Commercial 28% Trading 36% Traditional Bank $23.8 billion Investment Bank $10.5 billion The plurality of B of A’s investment banking revenue, or 36%, comes from trading debt and equity securities.
  7. Consumer 72% Commercial 28% Trading 36% Advisory & Underwriting 28% Traditional Bank $23.8 billion Investment Bank $10.5 billion The next largest share stems from advising businesses on mergers and acquisitions, and from underwriting stock and bond sales.
  8. Consumer 72% Commercial 28% Trading 36% Advisory & Underwriting 28% Traditional Bank $23.8 billion Investment Bank $10.5 billion Prime Brokerage 11% 11% of investment banking revenue comes from B of A’s prime brokerage, which offers trading-related services to institutional investors such as hedge funds and PE firms.
  9. Consumer 72% Commercial 28% Trading 36% Interest & Other 25% Advisory & Underwriting 28% Traditional Bank $23.8 billion Investment Bank $10.5 billion Prime Brokerage 11% The remaining 25% derives from net interest income and other ancillary activities.
  10. Consumer 72% Commercial 28% Trading 36% Interest & Other 25% Advisory & Underwriting 28% Traditional Bank $23.8 billion Asset/Wealth Management $9.1 billion Investment Bank $10.5 billion Prime Brokerage 11% Bank of America’s third main business line is an asset and wealth manager, accounting for revenue of $9.1 billion in the first and second quarters of 2015.
  11. Consumer 72% Commercial 28% Merrill Lynch 83% Trading 36% Interest & Other 25% Advisory & Underwriting 28% Traditional Bank $23.8 billion Asset/Wealth Management $9.1 billion Investment Bank $10.5 billion Prime Brokerage 11% Merrill Lynch’s “thundering herd” of financial advisors generates the lion’s share, or 83%, of the unit’s revenue by serving America’s mass affluent (net worth > $250k).
  12. Consumer 72% Commercial 28% Merrill Lynch 83% U.S. Trust 17% Trading 36% Interest & Other 25% Advisory & Underwriting 28% Traditional Bank $23.8 billion Asset/Wealth Management $9.1 billion Investment Bank $10.5 billion Prime Brokerage 11% The remaining 17% comes from U.S. Trust, a subsidiary serving high net worth and ultra high net worth clients.
  13. Consumer 72% Commercial 28% Merrill Lynch 83% U.S. Trust 17% Trading 36% Interest & Other 25% Advisory & Underwriting 28% Traditional Bank $23.8 billion Asset/Wealth Management $9.1 billion Investment Bank $10.5 billion Prime Brokerage 11% Looking for more content like this? Simply click here now for The Motley Fool’s latest free report, covering the $19 billion industry that could destroy the Internet.
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I made this slideshow for anyone curious to learn how the $2.2 trillion Bank of America makes its money.

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