This report on Form 10-Q contains certain statements that are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Actual outcomes and results may differ materially from those expressed in, or implied by, our forward-looking statements. Words such as "expects," "anticipates," "believes," "estimates" and other similar expressions or future or conditional verbs such as "will," "should," "would" and "could" are intended to identify such forward-looking statements. Readers of the Form 10-Q of Bank of America Corporation and its subsidiaries (the Corporation) should not rely solely on the forward-looking statements and should consider all uncertainties and risks throughout this report as well as those discussed in the Corporation's 2004 Annual Report. The statements are representative only as of the date they are made, and the Corporation undertakes no obligation to update any forward-looking statement.

Possible events or factors that could cause results or performance to differ materially from those expressed in our forward-looking statements include the following: changes in general economic conditions and economic conditions in the geographic regions and industries in which the Corporation operates which may affect, among other things, the level of nonperforming assets, charge-offs and provision expense; changes in the interest rate environment which may reduce interest margins and impact funding sources; changes in foreign exchange rates; adverse movements and volatility in debt and equity capital markets; changes in market rates and prices which may adversely impact the value of financial products including securities, loans, deposits, debt and derivative financial instruments, and other similar financial instruments; political conditions and related actions by the United States abroad which may adversely affect the Corporation's businesses and economic conditions as a whole; liabilities resulting from litigation and regulatory investigations, including costs, expenses, settlements and judgments; changes in domestic or foreign tax laws, rules and regulations as well as Internal Revenue Service (IRS) or other governmental agencies' interpretations thereof; various monetary and fiscal policies and regulations, including those determined by the Board of Governors of the Federal Reserve System (FRB), the Office of the Comptroller of Currency, the Federal Deposit Insurance Corporation and state regulators; competition with other local, regional and international banks, thrifts, credit unions and other nonbank financial institutions; ability to grow core businesses; ability to develop and introduce new banking-related products, services and enhancements, and gain market acceptance of such products; mergers and acquisitions and their integration into the Corporation; decisions to downsize, sell or close units or otherwise change the business mix of the Corporation; and management's ability to manage these and other risks.

The Corporation, headquartered in Charlotte, North Carolina, operates in 29 states, the District of Columbia and 43 foreign countries. The Corporation provides a diversified range of banking and nonbanking financial services and products both domestically and internationally through four business segments:
Global Consumer and Small Business Banking, Global Business and Financial Services, Global Capital Markets and Investment Banking, and Global Wealth and Investment Management.

At March 31, 2005, the Corporation had $1.2 trillion in assets and approximately 175,000 full-time equivalent employees. Notes to Consolidated Financial Statements referred to in Management's Discussion and Analysis of Results of Operations and Financial Condition are incorporated by reference into Management's Discussion and Analysis of Results of Operations and Financial Condition. Certain prior period amounts have been reclassified to conform to current period presentation.

On April 1, 2004, we completed our merger with FleetBoston Financial Corporation (FleetBoston) (the Merger) after obtaining final shareholder and regulatory approvals. The Merger was accounted for under the purchase method of accounting. Accordingly, results for the three months ended March 31, 2004 exclude FleetBoston.

On October 15, 2004, we acquired 100 percent of National Processing, Inc. (NPC), for $1.4 billion in cash, creating the second largest merchant processor in the United States.

Performance Overview

Net Income totaled $4.7 billion, or $1.14 per diluted common share, for the three months ended March 31, 2005, 75 percent and 25 percent increases from $2.7 billion, or $0.91 per diluted common share, for the three months ended March 31, 2004.

                 Business Segment Total Revenue and Net Income



                                                     Total Revenue            Net Income
                                                  --------------------     -----------------
                                                         Three Months Ended March 31
                                                  ------------------------------------------
  (Dollars in millions)                             2005        2004        2005      2004
  ---------------------------------------------   --------     -------     -------   -------
  Global Consumer and Small Business Banking      $  6,961     $ 4,724     $ 1,899   $ 1,070
  Global Business and Financial Services             2,734       1,569       1,120       582
  Global Capital Markets and Investment Banking      2,632       2,173         721       453
  Global Wealth and Investment Management            1,794       1,101         576       246
  All Other                                            100         133         379       330
                                                  - ------ -   - ----- -   - -----   - -----
  Total FTE basis (1)                               14,221       9,700       4,695     2,681
  FTE adjustment (1)                                  (199 )      (169 )        -         -
                                                  - ------ -   - ----- -   - -----   - -----
  Total                                           $ 14,022     $ 9,531     $ 4,695   $ 2,681
                                                  - ------ -   - ----- -   - -----   - -----

Global Consumer and Small Business Banking

Net Income increased $829 million, or 77 percent, to $1.9 billion for the three months ended March 31, 2005 compared to the same period in 2004. Driving this increase was the $1.2 billion increase in Net Interest Income, a $477 million increase in Card Income and a $233 million increase in Service Charges. Partially offsetting this was a $708 million increase in Noninterest Expense and a $285 million increase in Provision for Credit Losses. The increase in Provision for Credit Losses to $714 million from $429 million was primarily driven by higher credit card net charge-offs of $297 million, of which $139 million was attributed to the addition of the FleetBoston credit card portfolio. For more information on Global Consumer and Small Business Banking, see page 37.

Global Business and Financial Services

Net Income increased $538 million, or 92 percent, to $1.1 billion for the three months ended March 31, 2005 compared to the same period in 2004. Average Loans and Leases increased $62.3 billion, or 57 percent, and average Deposits increased $43.4 billion, or 70 percent. The increase in Loans and Leases was primarily due to the addition of FleetBoston and organic loan growth in Business Banking, Middle Market Banking and Commercial Real Estate. Deposit balance growth resulted from the addition of FleetBoston. Also driving the improved results was a $148 million decrease in Provision for Credit Losses, resulting primarily from actions taken (including loan sales) to reduce certain portfolio exposures. For more information on Global Business and Financial Services, see page 44.

Global Capital Markets and Investment Banking

Net Income increased $268 million, or 59 percent, to $721 million for the three months ended March 31, 2005 compared to the same period in 2004. The increase in Net Income was driven by higher Trading Account Profits of $437 million and increased Equity Investment Gains of $108 million. These increases were offset by a decrease in Investment Banking Income of $31 million primarily due to a decline in securities underwriting. Also impacting Net Income was a decline in Net Interest Income of $91 million as a result of a flattening yield curve, and higher Noninterest expense of $85 million. For more information on Global Capital Markets and Investment Banking, see page 46.

Global Wealth and Investment Management

Net Income increased $330 million, or 134 percent, to $576 million for the three months ended March 31, 2005 compared to the same period in 2004. Contributing to the increase in Net Income was an increase of $341 million in Net Interest Income and higher Investment and Brokerage Services income of $328 million. Partially offsetting these increases were higher Personnel costs of $167 million related to the addition of client managers and increased incentives. Total assets under management decreased $18.1 billion, or 4 percent, to $433.4 billion at March 31, 2005 compared to December 31, 2004, driven by a $9.8 billion decrease due to market valuations, $4.0 billion in net outflows consisting primarily of outflows in short-term money market funds and fixed income offset by inflows in equity products, and a $4.3 billion adjustment to reclassify assets to assets in custody. For more information on Global Wealth and Investment Management, see page 49.

All Other

Net Income increased $49 million, or 15 percent, to $379 million for the three months ended March 31, 2005 compared to the same period in 2004. This increase was driven by a decrease in Provision for Credit Losses of $194 million and a $128 million increase in Gains on Sales of Debt Securities. Partially offsetting these increases was a $224 million increase in Noninterest Expense, driven by $112 million of Merger and Restructuring Charges. For more information on All Other, see page 51.

Financial Highlights

Net Interest Income

Net Interest Income on a FTE basis increased $2.1 billion to $8.1 billion for the three months ended March 31, 2005 compared to the same period in 2004. This increase was driven by the impact of the Merger, growth in consumer loan levels (primarily credit card and home equity), higher core deposit funding levels, higher asset and liability management (ALM) portfolio levels (primarily consisting of securities) net of the impact of spread compression, and growth in middle-market business loan levels. Partially offsetting these increases were lower trading-related contributions and reductions in foreign loan balances. The net interest yield on a FTE basis declined 15 basis points (bps) to 3.11 percent primarily due to the negative impact of increased trading-related balances (which have a lower yield than other earning assets), ALM portfolio repositioning, including the impact of spread compression, partially offset by the addition of FleetBoston and growth in core deposit and consumer loan levels. For more information on Net Interest Income on a FTE basis, see Table 4 on page 35.

Noninterest Income



                               Noninterest Income



                                                    Three Months Ended
                                                         March 31
                                                  ----------------------
              (Dollars in millions)                  2005         2004
              ---------------------------------   ----------    --------
              Service charges                     $    1,777    $  1,416
              Investment and brokerage services        1,013         635
              Mortgage banking income                    221         209
              Investment banking income                  366         404
              Equity investment gains                    399         133
              Card income                              1,289         795
              Trading account profits                    760           3
              Other income                               324         135
                                                  -- -------    -- -----
              Total noninterest income            $    6,149    $  3,730
                                                  -- -------    -- -----

Noninterest Income increased $2.4 billion to $6.1 billion for the three months ended March 31, 2005 compared to the same period in 2004, due primarily to the addition of FleetBoston and organic growth.

• Service Charges grew $361 million driven by approximately $316 million from the addition of FleetBoston customers and organic account growth.

• Investment and Brokerage Services increased $378 million due to approximately $349 million related to the addition of FleetBoston and asset allocation changes with weighting increases in equities and fixed income and a weighting decrease in money market products.

• Mortgage Banking Income increased $12 million as a result of increased servicing income and a $5 million impact from the Merger.

• Investment Banking Income declined $38 million and included a $63 million decline in securities underwriting partially offset by a $30 million increase in syndications.

• Equity Investment Gains increased $266 million due to a $228 million increase in Principal Investing, which was the result of increased liquidity in the private equity markets.

• Card Income increased $494 million due to increased fees and interchange income, including the $242 million impact from the addition of the FleetBoston card portfolio.

• Trading Account Profits increased $757 million due to increased customer activity, more active portfolio management in our market-making books and wider spreads on credit default swaps. The first quarter of 2004 included mortgage-related trading losses and losses on our equity business from a retained stock position.

• Other Income increased $189 million as a result of the Merger and early leasing terminations.

For more information on Noninterest Income, see Business Segment Operations beginning on page 37.

Gains on Sales of Debt Securities

Gains on Sales of Debt Securities for the three months ended March 31, 2005 were $659 million compared to $495 million for the same period in 2004, as we continued to reposition the ALM portfolio in response to interest rate fluctuations and to manage mortgage prepayment risk. For more information on Gains on Sales of Debt Securities, see Market Risk Management beginning on page 74.

Provision for Credit Losses

The Provision for Credit Losses decreased $44 million to $580 million for the three months ended March 31, 2005 compared to the same period in 2004. This decline was driven by lower commercial net charge-offs of $135 million and continued improvements in credit quality in the commercial loan portfolio. Partially offsetting this decrease was an increase in the Provision for Credit Losses in our consumer credit card portfolio primarily driven by higher credit card net charge-offs of $297 million, of which $139 million was attributed to the addition of the

FleetBoston credit card portfolio. Organic credit card portfolio growth, continued seasoning of credit card accounts, the return of previously securitized loans to the balance sheet in 2004, as well as increases effective in 2004 in credit card minimum payment requirements drove higher net charge-offs. The increased net charge-offs associated with the increase in required credit card minimum payments did not impact the Provision for Credit Losses in the first quarter of 2005 as those net charge-offs were provided for in late 2004. For more information on credit quality, see Credit Risk Management beginning on page 58.

Noninterest Expense



                              Noninterest Expense



                                                   Three Months Ended
                                                        March 31
                                                 ----------------------
              (Dollars in millions)                 2005         2004
              --------------------------------   ----------    --------
              Personnel                          $    3,701    $  2,752
              Occupancy                                 636         488
              Equipment                                 297         261
              Marketing                                 337         281
              Professional fees                         177         160
              Amortization of intangibles               208          54
              Data processing                           364         284
              Telecommunications                        206         151
              Other general operating                 1,019         999
              Merger and restructuring charges          112          -
                                                 -- -------    -- -----
              Total noninterest expense          $    7,057    $  5,430
                                                 -- -------    -- -----

Noninterest Expense increased $1.6 billion to $7.1 billion for the three months ended March 31, 2005 compared to the same period in 2004, primarily due to the addition of FleetBoston.

• Personnel Expense increased $949 million primarily due to the $698 million impact of FleetBoston associates.

• Occupancy Expense increased $148 million due to the $142 million impact of the Merger.

• Amortization of Intangibles increased $154 million driven by the amortization of intangible assets acquired in the Merger.

• Merger and Restructuring Charges were $112 million in connection with the integration of FleetBoston's operations. For more information on Merger and Restructuring Charges, see Note 2 of the Consolidated Financial Statements.

For more information on Noninterest Expense, see Business Segment Operations beginning on page 37.

Income Tax Expense

Income Tax Expense was $2.3 billion, reflecting an effective tax rate of 33.4 percent, for the three months ended March 31, 2005 compared to $1.3 billion and 32.5 percent for the three months ended March 31, 2004. The difference in the effective tax rate between years resulted primarily from the application of purchase accounting to certain leveraged leases acquired in the Merger, an increase in state tax expense generally related to higher tax rates in the Northeast, as well as a higher level of pre-tax income.

Assets

Average Loans and Leases increased $9.5 billion, or two percent, for the three months ended March 31, 2005 compared to the three months ended December 31, 2004. Average Securities increased $33.4 billion, or 20 percent, as a result of repositioning our ALM portfolio and investing excess cash from deposit growth. Additionally, for the three months ended March 31, 2005 compared to the three months ended December 31, 2004, average trading-related assets increased $11.5 billion, or five percent, as we expanded our trading book to accommodate the needs of our clients. For more information, see Table 4 on page 35.

Liabilities and Shareholders' Equity

Average core deposits increased $9.3 billion, or two percent for the three months ended March 31, 2005 compared to the three months ended December 31, 2004. The increase was attributable to organic growth which resulted from our continued improvements in customer satisfaction, new product offerings and our account growth efforts. At March 31, 2005, our Tier 1 Capital ratio was 8.20 percent, compared to 8.10 percent at December 31, 2004. For more information, see Table 4 on page 35 and Capital Management beginning on page 56.

Table 1



Selected Quarterly Financial Data



                                   2005 Quarter                               2004 Quarters
                                  --------------      --------------------------------------------------------------
(Dollars in millions, except
per share information)                First             Fourth            Third           Second            First
------------------------------    --------------      -----------      -----------      -----------      -----------
Income statement
Net interest income               $        7,873      $     7,747      $     7,665      $     7,581      $     5,801
Noninterest income                         6,149            5,966            4,922            5,467            3,730
Total revenue                             14,022           13,713           12,587           13,048            9,531
Provision for credit losses                  580              706              650              789              624
Gains on sales of debt
securities                                   659              101              732              795              495
Noninterest expense                        7,057            7,333            7,021            7,228            5,430
Income before income taxes                 7,044            5,775            5,648            5,826            3,972
Income tax expense                         2,349            1,926            1,884            1,977            1,291
Net income                                 4,695            3,849            3,764            3,849            2,681
Average common shares issued
and outstanding (in thousands)         4,032,550        4,032,979        4,052,304        4,062,384        2,880,306
Average diluted common shares
issued and outstanding (in
thousands)                             4,099,062        4,106,040        4,121,375        4,131,290        2,933,402

Performance ratios
Return on average assets                    1.59 %           1.33 %           1.37 %           1.41 %           1.29 %
Return on average common
shareholders' equity                       19.30            15.63            15.56            16.63            22.16
Total equity to total assets
(period end)                                8.13             8.97             9.14             9.35             6.10
Total average equity to total
average assets                              8.23             8.51             8.79             8.52             5.84
Dividend payout                            39.02            47.45            48.75            42.60            43.21

Per common share data
Earnings                          $         1.16      $      0.95      $      0.93      $      0.95      $      0.93
Diluted earnings                            1.14             0.94             0.91             0.93             0.91
Dividends paid                              0.45             0.45             0.45             0.40             0.40
Book value                                 24.35            24.56            24.14            23.51            16.85

Average balance sheet
Total loans and leases            $      524,944      $   515,463      $   503,078      $   497,158      $   374,077
Total assets                           1,200,883        1,152,551        1,096,683        1,094,459          833,192
Total deposits                           627,419          609,936          587,878          582,305          425,075
Long-term debt                            97,126           99,588           98,361           96,395           78,852
Common shareholders' equity               98,542           97,828           96,120           92,943           48,632
Total shareholders' equity                98,814           98,100           96,392           93,266           48,686

Capital ratios
Risk-based capital:
Tier 1                                      8.20 %           8.10 %           8.08 %           8.20 %           7.73 %
Total                                      11.46            11.63            11.71            11.97            11.46
Leverage                                    5.82             5.82             5.92             5.83             5.43

Market price per share of
common stock
Closing                           $        44.10      $     46.99      $     43.33      $     42.31      $     40.49
High closing                               47.08            47.44            44.98            42.72            41.38
Low closing                                43.66            43.62            41.81            38.96            39.15

Supplemental Financial Data

Table 2 provides a reconciliation of the supplemental financial data mentioned below with GAAP financial measures. Other companies may define or calculate supplemental financial data differently.

Operating Basis Presentation

In managing our business, we may at times look at performance excluding certain non-recurring items. For example, as an alternative to Net Income, we view results on an operating basis, which represents Net Income excluding Merger and Restructuring Charges. The operating basis of presentation is not defined by accounting principles generally accepted in the United States (GAAP). We believe that the exclusion of Merger and Restructuring Charges, which represent events outside our normal operations, provides a meaningful period-to-period comparison and is more reflective of normalized operations.

Net Interest Income - FTE Basis

In addition, we view Net Interest Income and related ratios and analysis (i.e. efficiency ratio, net interest yield and operating leverage) on a FTE basis. Although this is a non-GAAP measure, we believe managing the business with Net Interest Income on a FTE basis provides a more accurate picture of the interest margin for comparative purposes. To derive the FTE basis, Net Interest Income is adjusted to reflect tax-exempt interest income on an equivalent before-tax basis with a corresponding increase in Income Tax Expense. For purposes of this calculation, we use the federal statutory tax rate of 35 percent. This measure ensures comparability of Net Interest Income arising from both taxable and tax-exempt sources.

Performance Measures

As mentioned above, certain performance measures including the efficiency ratio, net interest yield, and operating leverage utilize Net Interest Income (and thus Total Revenue) on a FTE basis. The efficiency ratio measures the costs expended to generate a dollar of revenue, and net interest yield evaluates how many basis points we are earning over the cost of funds. Operating leverage measures the total percentage revenue growth minus the total percentage expense growth for . . .