• The second largest bank in the US by Assets in 2011
• One of the largest branch networks in the US with about 5,700 locations and 17,000 ATM
• Total Assets (2011): $2,130 billion
• Employees (2011): 282,000

Project New BAC

• Goal: Promote growth by making it easier for customers and clients to do business with the bank and to serve them better; make it easier for employees to do their work and to cooperate with other departments, thereby liberating and speeding up growth; and as a result better serve the bank’s shareholders. Therefore the project focused on simplifying processes, aligning resources with customer segments, reducing unnecessary expenses and increasing revenues.

• Project Structure: Project New BAC is a two-phase, enterprise-wide initiative striving for operational excellence by leveraging the knowledge of the employees.

Phase 1

• Timeline: May to September 2011

• Scope: Consumer Businesses (incl. Deposits, Card Services and Consumer Real Estate Services), Consumer Business support; as well as technology and operations functions.

• Announced Impact: Cost reduction of $5 billion per year by 2015.

• Start of Implementation: 2011

Phase 2

• Timeline: October 2011 to April 2012

• Scope: Global Wealth and Investment Management, Global Commercial Banking, Global Banking and Markets, as well as related support, technology and operations functions.

• Announced Impact: Cost reduction of $3 billion per year by 2015

• Start of Implementation: 2012. All aspects of New BAC are expected to be implemented by 2015.

Structural and Operational Improvements

• CEO Brian Moynihan transformed the company from a product-driven business to a customer-driven business. The company is now structured to better focus on three core customer groups: individuals, companies and institutional investors.

• Project New BAC made the business more effective and efficient within this new customer-relationship strategy, among others by

  • Simplifying processes
  • Stopping unnecessary activities
  • Consolidating duplicative functions
  • Improving connections between departments
  • Simplifying operating platforms: elimination of obsolete applications and investment in next generation technology, e.g. eliminating overlapping deposit systems
• Brian announced that more than 3,000 ideas would be implemented out of 150,000 ideas generated

Earnings Announcement Six Months into Implementation

• Excellent capital ratios

• Strong growth

  • Deposits up 6%; AUM up 27%; commercial loans up 13%; Investment bank revenues up 42%
  • Cross selling: 28% increase in new 401k assets from existing clients
• Top performing stock in 2012