KEITH T. BANKS
President
U.S. Trust
Bank of America Private Wealth Management
(Photo by Grant Delin)

As we all know, 2011 has been a turbulent year for financial markets. Mounting economic concerns here and abroad, political turmoil and even natural disasters have all taken their toll on investor confidence and have caused severe market volatility. Still, looking beyond pervasive investor fears, we see legitimate signs of improvement. The global economy is finding more secure footing, and here at home, corporate balance sheets are stronger than they have been in years, with profits at record-high levels.

We’re not saying we’re out of the woods. We are not, and we won’t be for some time. But we do know — having navigated successfully through difficult environments in the past — that volatile conditions create both challenges and opportunities. That means we will continue to be responsive to rapid changes in market conditions, combining tactical adjustments that seek both to protect portfolios from volatility and to take advantage of it. We explore several of these areas of opportunity in this issue of Capital Acumen.

Another aspect of the challenging environment in recent months has been increased media focus on Bank of America, as I’m sure many of you have noticed. The fact is that the company continues to make progress in many important areas. For the third quarter of 2011, Bank of America reported net income of $6.2 billion, or $0.56 per diluted share, compared with a net loss of $7.3 billion, or $0.77 per diluted share, in the year-ago period. The company continued to deliver on its goal of building a fortress balance sheet by reducing risk-weighted assets, building capital and maintaining strong liquidity levels even after significantly reducing both short- and long-term debt.

Bank of America remains one of the world’s largest financial institutions, with $2.2 trillion in assets, more than $1 trillion in deposits and $933 billion in loans as of September 30, 2011. Notably, the Tier 1 capital ratio, a comparison between the firm’s core equity capital and total risk-weighted assets, stood at 11.48% at the end of the third quarter. This is well above the minimum guidelines. Bank of America also has more than $400 billion in excess liquidity.

The bottom line is that U.S. Trust has the resources to meet the broad-based wealth management needs of its clients. We remain focused on providing you and your family with timely insights and perspectives and, most important, we will continue to stand with you during these challenging times.

Keith T. Banks
President
U.S. Trust, Bank of America Private Wealth Management