Good day, everyone, and welcome to the Bank of America Earnings Announcement. At this time, I'd like to turn the program over to Lee McEntire. Please go ahead, sir.

Thank you, Catherine. Good morning. Welcome. Thank you for joining the call to review our first quarter results. I trust everybody has had a chance to review our earnings release documents. They are available, including the earnings presentation that we'll be referring to during this call, on the Investor Relations section of the bankofamerica.com website. I'm going to turn the call over to CEO, Brian Moynihan; and Alastair Borthwick, our CFO, to discuss the quarter. But before I do, let me just remind you that we may make forward-looking statements and refer to non-GAAP financial measures during this call. Our forward-looking statements are based on management's current expectations and assumptions, and subject to risks and uncertainties. Factors that might cause those actual results to materially differ from those expectations are detailed in our earnings materials and the SEC filings that are available on our website. Information about the non-GAAP financial measures, including reconciliations to U.S. GAAP, can also be found in our earnings materials, and those are available on our website. So, with that, I will turn it over to Brian. Thank you.

Good morning, and thank you all for joining us. I'm starting on Slide 2 of the materials. Your company produced one of its highest core EPS earnings numbers in a challenged operating environment in the first quarter. Simply put, we navigated that environment well. The preparedness and strength of Bank of America and the trust of our clients reflect a decade-long responsible growth model and relationship nature of our franchise. During quarter one, importantly, our organic growth engine continued to perform. Let me first summarize some points, and I'll turn it over to Alastair to take you through the details of the quarter. If you go to Slide 2 of the materials, Bank of America delivered strong earnings, growing EPS 18% over first quarter '22. Every business segment performed well. We grew clients and accounts organically and at a strong pace. We delivered our seventh straight quarter of operating leverage, led by a 13% year-over-year revenue growth. We further strengthened our balance sheet, with our CET1 ratio increasing to 11.4%. Regulatory capital ended at the highest nominal level in our history at $184 billion. We maintained strong liquidity, ending the quarter with more than $900 billion in Global Liquidity Sources. We are providing good returns for you as our shareholders, with a return on tangible common equity of 17%, a 107 basis points return on average assets. Tangible book value per share grew 9% year-over-year. We achieved this as the economy slowed. Our research team continues to predict a shallow recession that will occur beginning in the third quarter of 2023. It's interesting; when we look at our consumer behavior, payments by consumers continued to drive the U.S. economy. We've seen debit and credit card spending at about a 6% year-over-year growth pace, a little slower but still healthy. Card spending represents less than a quarter of how consumers pay for things out of their accounts at Bank of America. Overall payments from our customers' accounts across all sources were up 9% year-over-year for March as a month. Year-to-date, they were up about 8% for the quarter. After slowing in the back half of 2022, we saw the pace of payments pick back up in quarter one, especially in the latter parts of the quarter. Consumers' financial positions remain generally healthy. They are employed with generally higher wages, continue to have strong account balances, and have good access to credit. As you think through all the tightening actions of the Fed, the flows to alternative yielding assets, investments and the disruptions in the past quarter, our deposits continued to perform well, ending the quarter at $1.91 trillion, roughly the same balance that we had in mid-October of 2022. We've seen these balances stabilize and remain 34% above where they were prior to the pandemic. The team has managed well during these periods by remaining focused on the things we can control to drive value through our franchise. I thank them for a very strong quarter, near-record earnings with strong returns. Let me turn the call over to Alastair to walk through the details of the quarter.

Thank you, Brian. I'll pick up on Slide 3, where we list some of the more detailed highlights of the quarter. Then, on Slide 4, we present the summary income statement. I'll refer to both of these together. As Brian mentioned, for the quarter, we generated $8.2 billion of net income, resulting in $0.94 per diluted share. Our revenue grew 13%, which was led by a 25% improvement in net interest income, coupled with a strong 9% growth in sales and trading results, excluding DVA. Our non-interest revenue was strong, despite three headwinds: First, we had lower service charges as commercial clients paid lower fees for treasury services, since they now receive higher earned rates on balances. This allows us to invest those funds to earn NII. On consumer, we had lower NSF insufficient funds and overdraft fees as a result of our policy changes announced in late 2021. Second, we experienced lower asset management fees due to the lower equity market levels and fixed-income market levels. Lastly, investment banking fees were lower, reflecting the continuation of sluggish industry activity and reduced fee pools. Despite these headwinds, each of the three categories saw modest improvement from the fourth quarter levels. Asset quality remained strong, and provision expense for the quarter was $931 million, which consisted of $807 million of net charge-offs and $124 million of reserve build. This reserve build compares to a reserve release in the first quarter 2022 of $362 million. Our charge-off rate was 32 basis points, still well below the fourth quarter of '19 when our pre-pandemic rate was 39 basis points, which was a multi-decade low. Credit remains quite strong. I want to point out on Slide 4 that pre-tax pre-provision income grew 27% year-over-year compared to reported net income growth of 15%. Let's turn to the balance sheet that starts on Slide 5. Our balance sheet increased by $144 billion to $3.195 trillion during the quarter. Brian noted our liquidity levels at the end of the period rose to more than $900 billion from December 31. This is $23 billion higher and remains $324 billion above our pre-pandemic level in the fourth quarter of '19. Shareholders' equity increased by $7 billion from the fourth quarter as earnings were only partially offset by capital distributed to shareholders, and we saw an improvement in AOCI of $3 billion due to lower long-term interest rates. The AOCI included more than $0.5 billion increase from improved valuations of AFS debt securities flowing through CET1. The remaining $2.5 billion was due to changes in cash flow hedges, which don't impact regulatory capital. During the quarter, we paid $1.8 billion in common dividends and bought back $2.2 billion in shares. Regarding regulatory capital, our CET1 level improved to $184 billion since December 31, and our CET1 ratio improved 14 basis points to 11.4%, adding to our buffer over our 10.4% current minimum requirement as well as the 10.9% minimum requirement that we'll encounter on January 1st of 2024. Over the past 12 months, we've improved our CET1 ratio by 100 basis points, returning $12 billion in capital to shareholders. CET1 capital improved by $4 billion, reflecting the benefit of earnings and the AOCI improvement, partially offset by the capital we've returned to shareholders. Our risk-weighted assets increased modestly, partly offsetting the benefits to the CET1 ratio from the higher capital we generated. Our supplemental leverage ratio increased to 6%, which compares to a minimum requirement of 5%, leaving plenty of capacity for balance sheet growth, and our TLAC ratio remains comfortably above our requirements. Turning to loan growth on Slide 6, average loans grew 7% year-over-year, driven by commercial loans and credit card growth. The credit card growth reflects increased marketing, enhanced offers, and higher levels of card account openings. Commercial growth over the past year reflects the diversity of commercial activity across global banking, global markets, and, to some extent, global wealth. On a more near-term linked-quarter basis, loans grew at a much slower pace, partly driven by seasonal credit card paydowns after fourth quarter holiday spending. Additionally, commercial demand slowed in Q1, and we saw some paydowns by our wealth management clients as they lowered leverage in response to rising rates. Now, regarding deposits, there has been significant focus this quarter, so I'll spend extra time here starting with Slide 7, focusing on average deposits. For the first quarter, average total deposits were $1.89 trillion, down 2% linked-quarter and down 7% year-over-year. Our deposits peaked in the fourth quarter of 2021. Even as the Fed continued to withdraw money supply, our deposits have remained around $1.9 trillion, largely because there are many more industry deposits today in a much larger economy compared to pre-pandemic. Average deposits were up 34% compared to our pre-pandemic Q4 '19 balance, and the industry's deposits were up 31% to $17.4 trillion. We've fared slightly better than the industry. Our pre-pandemic deposits for each line of business on the slide allow you to compare our current balances with those from before the pandemic. I want to highlight consumer checking balances, which remain 53% higher than pre-pandemic levels. As expected, GWIM combined client deposits are up 23%, as these clients generally move their excess cash into other off-balance sheet products. In global banking, we can see the rotation to interest-bearing over time as rates have risen. Let’s get more granular and use Slide 8 for that, where you can see the breakout of deposit trends on a weekly ending basis across the last two quarters. You can see the timeline of Fed target and rate hikes plotted in the top-left chart for comparison through time. In the upper left, you can see the trend of our total deposits. We ended Q1 '23 at $1.91 trillion, down 1%. As Brian mentioned, over the course of the past six months, these balances have remained relatively stable. In consumer, the top-right chart shows the movement through the quarter between balances of low to no interest checking accounts and the higher-yielding non-checking accounts. Over the entire quarter, we saw a modest $4 billion decline in total. Checking balances, by nature, have some variability around paydays in particular, but it's worth noting the relative stability of checking deposits, as these are operational accounts with money in motion for paying bills and everyday living costs for families. Interestingly, our checking balances modestly increased even before the upheaval of March 9 and continued to rise through the quarter as a result of the disruption. Lower non-checking balances mostly reflect cash shifting out of deposits and into brokerage accounts where we earn a small fee. Rates paid increased 6 basis points from the fourth quarter to 12 basis points on this group of total consumer deposits, which remains low because of the 52% mix of checking. Lastly, note that rate movements in this business are concentrated in the small CDs and consumer investment deposits, which together represent about 5% of the deposits. In wealth management, as expected, we see the most significant relative decline. You can observe the continued trend of clients moving funds from lower-yielding sweep accounts to higher-yielding preferred deposits and off-balance sheet investment alternatives. Over the past year, approximately $90 billion has moved out of sweeps, which leaves $80 billion in these accounts. With the pace and scale of rate hikes slowing, we expect declines in balances to lessen going forward. At the bottom-right, we note the global banking deposit movement, where we hold about $500 billion in customer deposits. These are typically operational deposits of our commercial customers who use them to manage their cash flows throughout the year. These deposits were down $3 billion from the fourth quarter. Notably, total deposits in this segment have remained stable at around $500 billion for the past six months, continuing to observe a rotation into interest-bearing accounts. The mix of interest-bearing deposits at the end of the quarter moved from 49% last quarter to 55% in Q1, and we are paying increased rates on those interest-bearing deposits. This rotation in global banking is driving the overall shift in the total company, which is quite normal and to be expected in this environment. In summary, our deposits have continued to behave as expected. The cash transactional balances are showing some recent stabilization, while for investment cash, we see deposits moving to brokerage and other platforms for direct holdings of money market, mutual funds, and treasuries. We are capturing many of those flows as you see in our numbers, and we expect that pace to slow going forward. Following our examination of trends for different lines of business, I want to emphasize the characteristics of our deposit franchise on Slide 9. This will reinforce for shareholders that they are investing in one of the world's premier deposit franchises, built upon the relationships we have with our customers and the value they place on the award-winning capabilities and convenience available to them. From the top, first focus on consumer. More than 80% of deposits have been held with us for over five years, and over two-thirds of our consumer deposits come from customers who've had relationships with the bank for over 10 years. Additionally, more than three-quarters of these customers are highly engaged in their banking activities with us. Geographically, they are spread across the United States, given our presence in 83 of the top 100 markets. Lastly, whether looking at consumers or small business clients, the value proposition is driving the same results. We have long-tenured customers with deep relationships who are highly engaged. Transitioning to wealth management, we see a similar story around long tenure and active relationships. The average relationship length of our Global Wealth Investment Management (GWIM) clients is around 14 years. Again, these clients are geographically diverse, digitally engaged, and we continue to see deepening engagement around our banking solutions and products of all types. Clients have numerous options that extend from their operational checking accounts to preferred deposit options, while also benefiting from our various investment platform offerings. In global banking, around 80% of our U.S. deposit balances are held by clients who have maintained accounts with us for at least 10 years. Furthermore, when measuring the number of solutions clients have with us, we find that 73% of balances are held by clients with at least five products with us. Like in the other businesses, they are highly diversified across industries and geographies, underscoring the stability of our deposit base. Having discussed both loans and deposits, I want to touch on balance sheet management and focus on the liquidity we enjoy from having a surplus of customer deposits that far exceeds the loan demand of our clients today and the loan demand pre-pandemic. Simply having deposits does not offset expenses related to supporting these customer bases nor does it hold value for our shareholders, unless we put them to work to derive value from those deposits. Slide 10 illustrates our pre-pandemic situation, showcasing that we've held significant excess deposits above loans. Before the pandemic, we had $0.5 trillion more in deposits than loans. This peaked at more than $1.1 trillion in late 2021 and has since remained high at roughly $900 billion. In Slide 11, we’ll focus on the banking book, as our global markets' balance sheet is largely market funded. From this slide, you can see trends in cash and cash equivalents, as well as the two components of debt securities balances: available-for-sale and held-to-maturity. The overall combined balance trends closely mirror the previous slide's excess deposit themes. In 2020, as deposits grew, loans declined due to pandemic-associated commercial client borrowing halts and subsequent fast repayments. Throughout 2020, as we deployed deposits, we took various actions to protect our capital, including building our hold-to-maturity, aligning capital treatment with our intent to hold those securities to maturity. Additionally, we hedged rate risks in the available-for-sale book using pay-fixed, receive-variable swaps. These securities acted similarly to cash; they earned higher yields and protected against capital volatility. As we entered mid-2021, it became clearer that stimulus payments would likely be the last ones, and therefore, we believed deposits would plateau. We ceased adding to our hold-to-maturity securities book, which peaked in the third quarter of 2021 at $683 billion, predominantly mortgage backs, with the remainder in treasuries. Over the past six quarters, notional balances have declined, ending the quarter at $625 billion, with the mortgage-backed portfolio decreasing by $67 billion to $495 billion. Throughout 2022, the value of our deposits increased alongside rising rates. At the same time, the disclosed market value of the hold-to-maturity securities fell, resulting in a negative market valuation for those bonds. This negative market valuation peaked in the third quarter, reduced in the fourth, and declined further by $10 billion in the first quarter. Our 10-K disclosure features a chart illustrating the maturity distribution of our securities portfolio, reminding everyone that this is based on the maturity dates of those originations—the date of the last contractual payment. When analyzing the actual cash flows of those bonds over time, it reveals an average weighted life of the hold-to-maturity securities book of just over eight years. Since the third quarter of 2021, we've seen consistent increases in overall yield on these balances due to the maturity and reinvestment of lower-yielding securities, as well as remixing into higher-yielding cash. With deposits paying 92 basis points, our blend of cash and government-guaranteed securities offers 290 basis points in yield. Hence, our net interest income (NII) increased significantly. NII, excluding global markets, disclosing quarterly, bottomed in the third quarter of 2020 at $9.1 billion, now at $14.5 billion in the first quarter of '23, reflecting a quarterly increase of $5.4 billion; this is the test of our effective balance sheet management. Now moving on to Slide 12 with a focus on net interest income. In the first quarter, NII on a GAAP non-FTE basis was $14.4 billion, while the FTE NII number was $14.6 billion. NII increased $2.9 billion or 25% from the first quarter of 2022, driven by rates, which included reductions in securities premium amortization. Average Fed fund rates increased 440 basis points year-over-year. Relative to this increase in Fed funds, which has benefited all of our variable rate assets, the rate paid on total deposits rose by 89 basis points, while the rate on interest-bearing deposits is up 133 basis points. Average loan growth of $64 billion also contributed to the year-over-year NII growth. In a linked-quarter comparison, NII of $14.6 billion is down $222 million from Q4, mainly due to the ongoing impact of lower deposit balances and the shift in mix to interest-bearing deposits. The decline was also influenced by lower global markets NII, which, as noted earlier, still gets passed through to clients via higher non-interest income as part of trading revenue. Excluding the $262 million decline in global markets' NII, the banking book's NII of $14.5 billion was modestly higher due to increased short interest rates, modest loan growth, and favorable shifts in deposits offset by two fewer days of interest in the quarter. Moving forward, the plus 100 basis point shift at March 31 stands at $3.3 billion of expected NII over the next 12 months from our banking book, with 96% of that sensitivity driven by short rates. In summary, the first-quarter NII was $14.6 billion, slightly exceeding our previous expectation of $14.4 billion due to modestly better deposit and rate pass-through performance. Looking ahead, we anticipate second-quarter NII to be about 2% lower compared to Q1, estimating it around $14.3 billion FTE, reflecting expected deposit movements and lower global markets' NII, which is again offset in trading revenue. To note, this guidance assumes that interest rates along the forward curve materialize, including one more hike and a couple of cuts in 2023. We also foresee funding costs for global markets client activity continuing to climb based on these high rates, while the impact of this is still offset in non-interest income—assumptions include current client positioning and forward rate expectations. Additionally, we expect modest loan growth, stemming from credit card and, to a lesser degree, commercial sources, alongside lower deposits and a rotational shift toward interest-bearing. As we move to Slide 13, I want to address expenses. Our first-quarter expenses were $16.2 billion, up $700 million from the fourth quarter, primarily due to seasonal increases from payroll taxes, which added about $450 million, with another $100 million driven by higher FDIC insurance expenses this quarter, and an additional $100 million in costs from hiring new employees. We ended the first quarter with over 217,000 employees, an increase of 260 people from year-end. In the quarter, we brought on 3,000 new people in January, resulting from outstanding offers we extended in the previous quarter. Our headcount peaked in January at slightly over 218,000, and by the end of last week, we were down to 216,000. We expect this figure to decline further over time, anticipating that our full-time equivalent headcount will settle at around 213,000 by the end of the second quarter, excluding summer interns. For the upcoming quarter, we expect Q2 expenses to benefit from reduced seasonal payroll tax impacts seen in Q1, along with decreases from headcount reductions over time and our operational excellence initiatives. Therefore, we estimate Q2 expenses will be around $400 million to $500 million lower than Q1, which translates to roughly $15.8 billion, plus or minus. We also foresee continued sequential expense reductions in Q3 and Q4, benefiting from ongoing headcount discipline and attrition. Now, let's transition to asset quality on Slide 14. Starting the credit discussion, I want to emphasize that our customers’ asset quality remains healthy, and net charge-offs have begun to rise from near-historic lows. Net charge-offs of $807 million increased by $118 million from the fourth quarter, driven by credit card losses as higher late-stage delinquencies flowed through to charge-offs. For context, the credit card net charge-off rate was 2.21% in this first quarter compared to 3.03% in the fourth quarter of '19. Provision expense was $931 million in Q1, including a $124 million reserve build, down from the $403 million build we recorded in the fourth quarter. This reflects modest loan growth and a slightly improved macroeconomic outlook, with the unemployment rate continuing above 5% at the close of 2023. We included a slide in the appendix this quarter showcasing the mix and credit metrics of our commercial real estate exposure. We've been selective about our client selection, portfolio concentration, and deal structures over many years; consequently, our non-performing loans (NPLs) and realized losses remain low in this portfolio. We had a total of $66 million in commercial real estate losses in 2022, with 70% arising from office loans that resulted in an annualized loss rate of 26 basis points. In the first quarter, office loan losses amounted to $15 million; we maintain approximately $73 billion in commercial real estate loans outstanding, which is less than 7% of our loan book, that is highly diversified geographically, with no region representing over 22% of the book. It's also diversified across property types. Within our property type, our office portfolio stands at $19 billion, about 2% of our total loans, with approximately 75% being Class A properties. Notably, our originations typically hover around a 55% loan-to-value ratio. While some property values have declined, this exposure is still well-secured. $3.6 billion of our commercial real estate loans are classified as reservable criticized. Even in our recent assessments of our toughest loans, we still have 75% LTVs. Of our office book, about $4 billion is slated for maturity this year, with an additional $6 billion in 2024, and the rest is distributed over subsequent years. We believe the portfolio is well-positioned and sufficiently reserved under prevailing conditions. On Slide 15 for completeness, we provide credit quality metrics for both our consumer and commercial portfolios. I will now turn it back to Brian to discuss our lines of business.

Thank you, Alastair. Let's jump to Slide 16. I want to highlight the drivers of long-term value for our franchise and for you, our shareholders. Every business segment grew customers and accounts organically this quarter, utilizing digital tools and capabilities to enhance engagement and drive customer satisfaction to industry-leading levels. On Slide 16, we've highlighted several important aspects of organic growth. In consumer, we opened 130,000 net new checking accounts, 1.3 million credit card accounts, and achieved a 9% increase in investment accounts, contributing to record quarter-one consumer investment flows. In global wealth, we had a record quarter, adding 14,500 net new wealth relationships. In global banking, our clients increased the number of products per relationship. In global markets, Jim DeMare and his team achieved one of the highest quarters of sales and trading in the company’s history. The management team remains focused on earnings, alongside continued investments for growth, even amidst this inflationary environment. We achieved operating leverage in our company, now running our seventh quarter of operating leverage. Our efficiency ratio sits at 62%, with nominal expense dollars today being similar to levels recorded eight to ten years ago. Then turning to Slide 18, we will dive into individual business segments, starting with consumer banking. This segment earned $3.1 billion for the quarter, fueled by robust organic revenue growth, and has delivered eight consecutive quarters of enhanced operating leverage while still investing for future growth. Top-line revenue increased 21%, with expenses rising 11%. These results demonstrate the tremendous value of our $1 trillion deposit franchise and the deep relationships we maintain with our clients in this business. The consumer banking segment currently features $700 billion in excess deposits over its loan balances. Additionally, since the pandemic began, we have gained 2.5 million new checking accounts. Strong earnings growth of 4% slightly understates this business's success, as the prior year included reserve releases, while we have built reserves this quarter. On a pre-tax pre-provision basis (PPNR), growth surged 34% year-over-year. I should note that revenue growth overcame a decline in service charges resulting from lowered NSFOD charges for customers in several recent quarters. Moving on to Slide 19, you'll see digital engagement statistics in consumer. We believe that the digital tools our customers utilize are key to fostering and maintaining customer relationships effectively. These tools also enable us to deliver services more efficiently. We currently have 45 million users actively engaging with our digital platforms, logging in 1 billion times a month. Erica, our AI-driven personal assistant, saw a 35% rise in usage over the past year. The number of our customers using Zelle grew 21% in the same timeframe. It's worth noting that these aren't merely new functionalities; these growth numbers illustrate the substantial impact Bank of America is having on these products. On Zelle, the number of transactions surpassed checks written by our clients starting in mid-2021. Two years later, this figure has increased by an additional 60%. From our perspective, we are dedicated to expanding our customer base while providing best-in-class tools and services to enhance the efficiency and importance of our consumer engagement, and Dean Athanasia and his team continue to excel in achieving these objectives. Slide 20 outlines our wealth management results. This segment achieved earnings of just over $900 million after tax in the quarter. While these results saw a reduction from last year's figures, as Alastair mentioned, asset management fees fell due to negative market levels in equity and fixed income. These declines were mitigated by the positive revenue contributions from the sizable banking business within this segment. Both Merrill and the Private Bank experienced organic revenue growth, leading to impressive client inflows of $25 billion in the quarter. Our assets under management flows of $15 billion reflect earlier deposit shifts, alongside $33 billion in brokerage inflows. While expenses reflected lower revenue-driven incentives, they also demonstrated our ongoing business investments, with a notable addition of over 650 wealth advisors in the past year. With Eric Schimpf and Lindsay Hans now leading this business, they work closely with Katy Knox to drive the global wealth and investment management business across the company. Slide 21 presents digital engagement statistics, showcasing the continued rise in client engagement with our digital offerings. Just as in the consumer business, our wealth management clients are becoming increasingly digitally engaged. Our advisors are implementing a personal-driven advice model reinforced by digital tools, resulting in an impressive client digital adoption rate of 84% for Merrill, with even higher figures over 90% for the Private Bank. More than 75% of clients choose to receive their statements via digital delivery, which offers added convenience for both them and our advisors. Erica and Zelle interactions continue to expand in this segment as well, even among wealthy clients. Slide 22 highlights our global banking results. This business achieved strong performance, with year-over-year revenue growth of 19%, reaching $6.2 billion and earning $2.6 billion after-tax. Despite sluggish investment banking conditions, our global treasury services business remained robust, driving substantial revenue performance. Loan activity across this business was solid as well. As mentioned earlier, deposit flows have stabilized in March, also benefiting from customer inflows during the recent flight to safety. Overall investment banking fees for the company reached $1.2 billion in Q1. Although this number was down from Q1 '22, we observed a modest improvement from Q4 '22. Provision expenses decreased year-over-year, with prior-year reserve builds compared to current period releases. Again, credit quality remains solid in this business. Year-over-year expense growth reached 10%, driven partly by strategic investments in the business, including hiring relationship managers and technology costs. Digital engagement with our global banking customers continues to grow. These commercial customers appreciate the ease of doing business through our digital tools, moving substantial amounts of money, even if the sheer transaction volume doesn’t match that of consumer accounts. Next, we turn to our global markets business on Slide 24. Jim DeMare and his team delivered another strong quarter, achieving nearly $1.7 billion in after-tax earnings. The persistent themes of inflation due to geopolitical tensions and changing monetary policies globally created volatility in bond and equity markets, which our team skillfully managed. This quarter, we recorded strong performances in our credit trading business, specifically in mortgages and municipals, and macro trading also performed well, buoyed by high client activity. Our previous investments in this business continue to yield positive returns. Looking solely at sales and trading metrics—excluding DVA—revenue rose 9% year-over-year, totaling $5.1 billion, with FICC improving by 29% while equities faced a 19% decline in comparison to Q1 '22. Year-over-year expense increased by 8%, largely due to ongoing strategic investments in the business. Finally, on Slide 5, we note a modest loss on all other lines, which includes the $220 million in securities sold mentioned previously. Additionally, our effective tax rate this quarter stood at 10%, benefiting from our robust business with clients, supporting environmental investments, and in-housing investments leading to tax advantages. Excluding these and other discrete tax benefits, our tax rate would have been 26%. In summary, our team delivered a strong quarter characterized by significant operating leverage, organic growth, strong credit metrics, capital returns, and strong ROTCE. Now, let’s move on to the Q&A session.

We'll take our first question from Jim Mitchell with Seaport Global. Your line is open.

Hey, good morning, guys. I have one question regarding the NII trajectory. You guys remain asset-sensitive in the banking book, but the forward curve currently expects, as you've pointed out, three rate cuts by year's end. If that plays out, how should we think about its impact on NII in the latter half of the year? What’s the upsides and downsides in your view as we contemplate NII beyond Q2?

So, Jim, I think at this point, the market's expectations regarding whether there will be another hike in May is still under debate. Similarly, there’s uncertainty concerning whether there will be two or three cuts in the latter half of the year. Therefore, we’re assessing the same information you are. We track the forward curve day-to-day to explore options. Meanwhile, we’re monitoring our deposit balances, which are behaving in ways we anticipated and are competing in terms of rates offered. Generally, we feel optimistic about NII at this stage; it's on track to rise significantly this year. However, we don’t provide guidance for the entire year due to the inherent difficulty in predicting the Fed’s actions six to nine months ahead. Currently, consensus pegs NII near $57 billion, which effectively suggests an annual increase of 7% to 8%. We are comfortable with that estimation, but there are numerous dynamic factors at play, and that’s why we refrain from providing direct guidance.

Understood. I also wanted to pivot to the trading business, which performed well again, outpacing peers in fixed income. Did you observe anything unusually strong there, or do you feel you’ve made sustainable market share gains due to recent investments?

I believe the team has done an exceptional job. Brian discussed this before. A few years back, we collectively understood the importance of investing more in this segment, and we committed to that. Significant investments were made in both equities and fixed income, particularly to grow our macro businesses, which has been successfully executed in this quarter. The standout performance stemmed, especially from our macro products; this aligns with a generally favorable quarter for them. We witnessed positive returns across the board: mortgages, credit, munis, financing, futures, and FX all had strong performances, and I think Jim and the team are executing at an incredibly high level. We need to maintain that momentum.

Thanks for taking my questions.

We'll take our next question from Erika Najarian with UBS. Your line is open.

Hi, good morning. Alastair, regarding the expected trajectory of expenses you presented, do you still believe you will meet the projected $62.5 billion in total expenses for FY '23?

Currently, that's our expectation. We’re about 90 days into the quarter. Even as our workload decreases, we observe declining headcount, which will contribute positively throughout the year. We haven't altered any expectations at this time. We still face some challenges, such as maintaining a robust performance in our sales and trading business, which might necessitate further – let’s say, scrutiny – but we want to stay positive about our current expenses.

Got it. My second question is for Brian. You posted impressive revenue this quarter and increased your CET1 ratio. However, many investors are cautious regarding significant macro uncertainty going forward. With that in mind, how should we think about buyback activity moving ahead, especially as we approach the June stress test results?

In this quarter, we continued to implement our core principles, supporting customer base growth, paying dividends at what we consider a reasonable rate, and then returning the remainder to repurchase shares. We’re currently in the stress test phase, as you mentioned, and we need to evaluate the results. On a positive note, we surpassed a CET1 ratio of 11.40% this quarter, creating a substantial cushion ahead of our requirements for the first quarter of next year. We intend to adhere to our guiding principles; our capital position inspires confidence, so you should expect us to maintain our aim of supporting organic growth, dividends, and share buybacks, while still navigating the near-term developments in our business.

Thank you.

Next, we will hear from Ken Usdin with Jefferies. Your line is open.

Good morning. I want to talk about deposits. There's a significant ongoing mix shift that you discussed. Can you explain to us how much more mix shift you expect in terms of DVAs as a percentage of total deposits? How do you foresee this evolving across businesses regarding where customers are moving funds incrementally?

Ken, while many view Bank of America as a large entity, we need to consider the unique behaviors of different customer bases when it comes to the management of their cash. Whether it's transactional cash for consumers or operational deposits for successful businesses, the actions taken vary. We've certainly seen increased investment cash, as Alastair previously mentioned, and we are competitive in terms of pricing. The upside is that we have a robust investment platform to leverage those funds for clients who do not require daily cash management. For our consumer business, the large $700 billion surplus in deposits over loan balances has generated significant value. Those balances grew by about $300 billion from pre-pandemic levels and have remained stable thus far. Checking balances reflect this assertion in our charts, demonstrating stability and a minimal interest payout, creating ample franchise value. Customers with excess cash will look to put that to work in various ways, and we expect a continuation of trends toward market-driven deposit rates. However, the underlying value of this deposit franchise is rooted in transactional cash provided by consumers, which remains consistent.

Understood. Regarding Slide 11, you spoke about how you've been adjusting the composition of the securities portfolio and still benefitting from the variable rate swaps. Could you help us understand what the future holds, specifically whether you anticipate continuing to gain benefits from these variable rate swaps? Moreover, have you gone about any repositioning within your portfolio? There were some securities losses reported; is there room to optimize the portfolio for further income generation, even as it shortens?

Ken, think of our treasury assets as being swapped to floating, effectively treating them like cash. Also, during this quarter, we converted some of these into cash for clarity and ease of understanding; this shift resulted in a couple of hundred million in securities losses. The most efficient way to view our overall portfolio is through the lens of cash, available-for-sale, and held-to-maturity segments. As our securities in the hold-to-maturity category continue to mature, we're transitioning those flows into cash, which I've mentioned as a continual process in previous quarters. We are placing cash where it’s most advantageous, particularly during periods of volatility. In sum, our strategy will allow the portfolio to become smaller and shorter over time.

Appreciate that. Thank you.

Our next question comes from Mike Mayo with Wells Fargo. Your line is open.

Hello. The pressing question today is related to how well your assets match with your liabilities. I'm looking at Slide 11, which emphasizes the unrealized securities losses you've experienced. You noted the yield on your securities at 2.6% and your held-to-maturity portfolio spans eight years—these factors might indicate misalignment. Can you elaborate on the extent to which your assets are matched with your liabilities, and whether this is a source of concern?

Mike, our overview of deposit quality is fundamentally strong. When we expect rates to rise, bonds will yield returns much higher than our deposit offerings. We laid out for you just how broad and stable our deposit base is, which is essential to highlight given the current interest rate environment. The portrayal of customer stability is important here; that’s why we reference the longevity of our client relationships in the consumer, wealth, and global banking segments. To specify, 67% of consumer clients have been with us over ten years, and a typical client at our commercial bank has been with us for around 17 years. The persistence and operational value of these long-tenured deposits provide a large reassurance for our business.

Could you share specific numbers related to this long-tenured nature?

Of course, if we look at Slide 9, you’ll see that 67% of our consumer clients have been with us for over ten years. Our commercial client relationships also average around 17 years. These long relationships point to customer loyalty and the overall stability of our deposit base.

Understood. Please continue.

The key takeaway here is that we have a well-managed balance sheet. Additionally, we are witnessing a rise in capital and liquidity, having added $23 billion over the past quarter. We are also focused on growing our earnings. We reported $8.2 billion this quarter, among our best earnings periods ever. We always look for ways to enhance capital management. Our current focus is on ensuring we have ample liquidity to manage our growth while keeping an eye on the broader market conditions. Thus, we prioritize a well-structured balance sheet management strategy, and we're certainly seeing the benefits.

Thank you for that clarification. Just as a follow-up, facing declining deposit rates, is it fair to say your deposits are relatively lower in value since you don’t pay as much compared to your peers? Would you agree with that assessment?

That’s a complex question. Our value proposition has always revolved around client experiences rather than simply interest rates. We have invested heavily in client experience enhancements—financial center renovations, investments in staff, and digital improvements. Despite potential rate challenges, our strong client relationship continues to drive growth. For example, our consumer business achieved 130,000 net new checking accounts and 17 quarters of positive growth trajectories despite the increasing interest-sensitive market. This indicates our differentiated offerings and approach resonate with clients.

Thank you.

Next, we'll take a question from Glenn Schorr with Evercore. Your line is open.

Hi, thanks. Just a quick one related to potential flight-to-quality benefits experienced in March. My expectation was that clients would gravitate toward Bank of America during these periods; however, you didn’t highlight that specifically. Could you provide clarity on this observation?

While we’re refraining from quantifying exact numbers, we believe there was a visible flight to safety during that period. This comprised two elements: an immediate infusion of deposits and a subsequent onboarding of clients moving operational accounts with us—this latter process requires more time. Our numbers reflect organic growth, but we did benefit from recent disruptions. We feel confident in the underlying strength and progression we've observed.

Regarding forward guidance—the Fed may not share the same forward curve assumptions as the market. Could you discuss the sensitivity if rates do not decrease, and how it might affect your future NII?

We rely on the forward curve as it tends to provide an objective market perspective. Even if we’ve mentioned shifting expectations about possible hikes and cuts, we’ll need to adopt a model that takes all factors into consideration. At this point, I believe sensitivity to upside and downside of 100 basis points is the most effective we can provide, and we’ll continue to explore those components as they develop.

Final question about held-to-maturity securities; I know you don't feel the need to deleverage right now, but do you expect to be in a position to ride out the current unrealized losses?

Correct. Our current approach remains to manage while retaining long-term obligations—our portfolio is progressively shrinking and maturing as noted. We view this as an approach that enables us to focus on our stability.

Thank you. Appreciate the insight.

Next, we will hear from Steven Chubak with Wolfe Research. Your line is open.

Good morning. Alastair, since you mentioned robust KPIs from GWIM, I noticed a material decline in pre-tax margins year-over-year. Could you clarify how the business might progress under the new leadership, especially in balancing investment necessities with the need to remain profitable?

The decline in margin can largely be attributed to market downturns impacting revenue in the investment side. We foresee margins returning to the typical range of 20% to 30%, but that will require time and ongoing adjustments. Additionally, elevated payroll taxes have notably impacted this quarter’s expenses. We're optimistic despite these challenges, as we've been working on digital solutions to drive operational excellence in this business, which should yield positive results going forward.

Thank you for the colors, and any insight regarding upcoming regulatory developments, particularly increases in scenario planning for Basel IV, as well as expectations for FDIC special assessments given recent events?

We believe, as an industry, we maintain a very strong capital and liquidity position. Our performance has showcased stability throughout varying economic environments, including the pandemic. We feel well-equipped to navigate upcoming regulatory challenges, and the industry's overall strength, particularly compared to counterparts in Europe, is noteworthy. We hope that regulatory tendencies recognize this and provide an appropriate assessment moving forward.

Thank you, appreciate the context.

We will now take a question from Matt O'Connor with Deutsche Bank. Your line is open.

Good morning. I want to clarify aspects of the balance sheet; I've noted the cash level surged significantly alongside a rise in short-term borrowings. Were these driven by a need for increased liquidity in the current climate, and should we expect this trend to persist? I believe this affects NIM without significantly impacting NII dollars.

It’s both factors at play, Matt. The first quarter typically sees a seasonal build for us, which often creates short-term borrowings. This doesn’t really impede NIM, because that can be reinvested in yield-generating assets, but it may slightly affect overall NOI.

Right, so you're saying that it might weigh on NIM but not on NII dollars, correct?

That’s right.

Thanks. My other question relates to spending in March. Some peers have indicated a slowdown in activity during that period. You mentioned earlier that overall debit and credit card use increased by 6% annually and total payments by 9%. Could you provide additional context regarding any notable intra-quarter trends?

We did observe some softness in the early part of quarter one but also saw a resurgence in March. Early April figures indicate that spending is somewhat lower than in March, likely reflecting the impact of seasonal changes. It's prudent to be cautious about concrete interpretations at this stage, but the overall year-over-year performance points toward a moderating consumer behavior. Amid broader economic sentiment, consumer balances—especially for lower-income segments—are steadily increasing compared to peaks earlier last year. We experienced delays related to tax returns this year as well, which can affect quarter-to-quarter variability.

Thanks for your insight.

Finally, we will hear from Vivek Juneja with J.P. Morgan. Your line is open.

Thank you. I have a couple of questions. The shift to interest-bearing accounts that you've referenced, do you believe that this trend will continue? Or do you think that the pace is slowing, is it possible that it could accelerate?

I would expect the pace of this to slow over time, Vivek. We're nearing the levels from Q4 '19, which was a peak, and as rates rise, there’s naturally less necessity for clients to invest in this shift. Thus, the need for steady interest-bearing positions should gradually temper.

Understood. Finally, regarding office commercial real estate, in addition to the geographical mix you provided earlier, could you share specifics regarding the office CRE portfolio?

I can provide that information but will need to follow up afterwards, as it is not readily available at this moment. However, the geographic distribution of the office CRE portfolio likely mirrors our overall approach to client servicing in the United States.

Thanks for your assistance.

We'll take our next question from Gerard Cassidy with RBC. Your line is open.

Good morning, Brian and Alastair.

Good morning. How are you doing?

Alastair, regarding Slide 12, you indicated the impact of a 100 basis point parallel shift signifies an expected NII increase of $3.3 billion over the ensuing year. Should interest rates decline, how rapidly can you shift from an asset-sensitive position to a neutral or even liability-sensitive position on the balance sheet?

The impact would likely register at around -$3.6 billion considering a 100 point decrease. Gradually, as we make the investment decisions concerning interest-bearing accounts and clients’ rotation, we’re not simply transitioning from cash deposits alone; we will see gradual improvements in our NII as they progress back into positive shifts over time.

Understood. Can you also comment on the negative provision this quarter and the improved macro outlook that enabled such a stance? Did the results of a recent Shared National Credit exam inform this as well?

Those assessments form part of our continuous appraisal process, but this release does come through virtually on a trial basis. The fundamental improvement in our macro outlook provided the confidence for a negative provision, attributable to a strong credit quality in our portfolio. The overall environment shows relatively strong performance; thus, our emphasis rests on this careful navigation in the credit realm.

Thank you.

Thank you.

Thank you for your time. I want to express gratitude to my teammates for delivering outstanding performance again this first quarter of 2023, achieving 18% year-over-year EPS growth. The strength and stability showcased while supporting our customers is apparent in our capital ratios and liquidity metrics. Importantly, we spotlight our continued organic growth and operating leverage through revenue growth outpacing expense increases. We look forward to our next conversation.

This concludes today's program. Thank you for your participation. You may disconnect at any time, and have a wonderful day.