Today, we reported $7 billion in after-tax net income or $0.82 per diluted share.
This quarter capped a record year of $32 billion in earnings for 2021 and represented significant growth in net income over 2020.
We generated more than $7 billion of earnings in every quarter in 2021.
Revenue grew 4% year over year and activity gained momentum throughout the year.
Recall that in the first quarter 2021, we noted at the time that our expectation is that quarterly NII could progress up by $1 billion per quarter as we entered the fourth quarter.
And in fact, we have recorded fourth quarter NII that is $1.2 billion or 12% better than first quarter '21.
When you look at the balance sheet, we grew deposits $270 billion in 2021.
That was on top of the $360 billion of growth we had in 2020.
Now, of course, that's absent the first quarter of 2020 at the start of COVID, which had $70 billion of panic drawdowns in a few weeks.
At the end of the day, we produced strong ROA and a 17% ROTCE for you, our shareholders, and we returned $32 billion in capital during the year.
We are proud of our digital stats and continue to spotlight our results later in the materials, as usual, see Pages 24 to 28.
But some key stats on this page: Consumers logged into our digital channels more than 2.7 billion times in the fourth quarter alone.
Erica, our digital financial assistant, completed more than 400 million requests from our clients in year 2021.
86% of all the check deposit transactions are now digital.
Customers use Zelle to transfer $65 billion in the most recent quarter.
Cash flow approvals by our commercial and corporate clients to move money grew 240% since the pandemic.
Net new checking accounts have grown in each of the past 12 quarters.
We have $1.4 trillion in deposits from all American consumers.
On credit cards, at roughly 1 million new accounts in the fourth quarter alone, that's now operating at the same level of new card production as it was pre-pandemic.
When you think about consumer investments, Merrill Edge, as we call it, we opened 525,000 new accounts in the year 2021.
Those accounts carried when they renew at opening, $70,000 in balances for each of those accounts.
Now when you combine Merrill, the private bank, and consumer investments, they produced more than $170 billion in net client flows in 2021.
In global banking, we had record years of investment banking fees combined with strong GTS results.
Many firms focus -- many firms and many people discuss credit and debit spending, but as you look at the chart on the lower left-hand side of Page 4, you can see that 80% of the money moves in other form.
Bank of America's 67 million clients made $3.8 trillion in total payments during 2021.
That was an increase of 24% over pre-pandemic levels, an all-time high.
Fourth quarter payments were up 28% over 2019.
The December payments were up 30% over 2019.
Just focus on debit and credit spending, for the holiday period of November and December, spending was up 26% over 2019.
For all the spending of all types through January 17, 2022, we have seen it up over 11% versus the start of '21, which is well up over '20 and '19.
Focusing on the channels of payment in the lower right-hand chart that you'd expect cash and check volumes are down 24% for 2021 compared to '19.
In November, we had a small dip in customers who had $2,000 or less in their balances pre-pandemic.
They dipped by 1%.
And what's striking is that the balances for people who had less than $2,000 average balances before the pandemic, they're now sitting with five times the balances they had pre-pandemic.
For those customers at $10,000 in accounts before the pandemic, they're now sitting with two times in their accounts .
Another economic signpost worth noting with our customer activity was acceleration of loan growth in the fourth quarter.
Earlier this year, we -- earlier last year, we talked about the green shoots of loan growth we saw in the first quarter, and we saw that turn into growth as we move through the quarters, culminating with $50 billion in record loan growth this quarter.
$35 billion of that $50 billion was in the core consumer and commercial books.
Commercial loans; excluding PPP, grew $43 billion or 9% linked quarter.
Compared to quarter 3, growth this quarter was broad-based across all segments of commercial lending.
Card loans grew $4.6 billion or 6% from quarter 3 levels.
Card balances still remain well below the pre-pandemic levels of $95 billion, and we continue to push that opportunity.
Mortgage loan levels grew 2% linked quarter as origination remained at high levels and paydown slowed down.
On the next, Slide 6, I would like -- I would say that while we deliver capital back to our shareholders, $32 billion, and we invested in our teammates, we also continue to invest in our communities through our local teams across the country focused on our markets.
Eliminating NSF fees and reducing the overdraft charge per occurrence from $35 to $10 and the other changes we're making is a big win for our clients.
It's going to have an obvious impact on those fees, which have fallen dramatically since 2009 and 2010, but currently run about $1 billion in '21, and we'd expect them to drop by 75% over the next year or so.
As Brian noted, we produced $7 billion in net income, which grew 28% from fourth quarter '20, while earnings per share of $0.82 improved at a faster 39% pace due to our share repurchases.
Looking at our top-line improvement on a year-over-year basis, revenue rose 10%.
The improvement was driven by a $1.2 billion increase in NII and a little more than $800 million increase in noninterest income.
And I think we executed on that in 2021 with investment banking over $2 billion each quarter; sales and training -- trading near or above $3 billion each quarter; investment and brokerage services revenue over $4 billion each quarter.
In the fourth quarter, revenue growth outpaced expense growth on a year-over-year basis, which produced operating leverage of 400 basis points and a 19% year-over-year improvement in pre-tax pre-provision income to $7.3 billion.
With regard to returns, our ROTCE was 15%, ROA was 88 basis points, both of which improved nicely over the year.
During the quarter, the balance sheet grew $85 billion to a little less than $3.2 trillion, and this reflected the $100 billion of growth in deposits.
These deposits funded $51 billion of loans growth.
And we also added $14 billion in securities, and so our cash increased by $68 billion.
Our liquidity portfolio grew to $1.2 trillion or a little more than a third of our balance sheet, and shareholders' equity declined $2.4 billion from Q3, driven by the $8.9 billion of capital distributions, which once again outpaced earnings in the fourth quarter as it did in Q3.
With regard to our regulatory ratios, CET1 under the standardized approach was 10.6% and remains well above our 9.5% minimum requirement.
The CET1 ratio declined 50 basis points from Q3, driven by excess capital reduction, as well as an increase in our RWA, due to the strong loans growth.
Earnings alone in the most recent quarter contributed 45 basis points to our CET1 ratio before the other capital impacts of share repurchase.
Given our deposit growth, our supplemental leverage ratio declined to 5.5% versus a minimum requirement of 5%, which still leaves plenty of capacity for balance sheet growth.
Combining both consumer and wealth management customer balances, I would highlight that retail deposits grew $48 billion from Q3.
Our retail deposits have now grown to nearly $1.4 trillion, and we lead our competitors.
On a GAAP non-FTE basis, NII in Q3 was $11.4 billion.
But I know, as investors, you tend to focus on the FTE NII number, which was $11.5 billion.
So focusing on the change on an FTE basis, net interest income increased $1.2 billion from Q4 '20 or 11%, driven by deposit growth and related investing of liquidity.
NII versus Q3 of '21 was up $319 million, driven by deposit growth and then higher securities levels, as well as loans growth.
Premium amortization declined roughly $100 million to $1.3 billion in Q4, and the positive NII impact of lower premium amortization offset lower PPP fees.
Combined, those two headwinds add to about $250 million.
Our Q4 expenses were $14.7 billion, an increase of $291 million from Q3.
We typically experience seasonally higher payroll tax expense, and that was about $400 million in 2021.
Second, with regard to full-year 2022, our best expectation currently is we can hold expenses flat compared to 2021, which finished just below $60 billion.
The asset quality of our customers remains very healthy and net charge-offs this quarter fell to a historical low of $362 million or 15 basis points of average loans.
They continued a steady decline through the quarters of 2021, with Q4 down $100 million from Q3 and down more than $500 million from Q4 last year.
Our credit card loss rate was 1.42%, and that's less than half of the pre-pandemic rate.
Provision was a $489 million net benefit in Q4, driven primarily by asset quality, and macroeconomic improvement, and was partially offset by loans growth.
This included a reserve release of $850 million, primarily in our commercial portfolio.
I'll start by acknowledging what a strong year the consumer bank has had as they generated nearly $12 billion of earnings, which is 37% of record year results for the company.
Consumer opened over 900,000 net new checking accounts.
And in turn, consumer grew deposits by more than $140 billion.
They opened 3.6 million credit cards and grew card accounts in 2021 by more than any of the past four years.
They also opened 525,000 new consumer investment accounts.
And that helped us to reach a new record for investment balances of $369 billion, growing 20% year over year as customers continue to recognize the value of our online offering.
Yes, market valuations grew balances, and we also saw $23 billion of client flows since Q4 '20.
And in the quarter, the business produced $3.1 billion of earnings off $8.9 billion of revenue and managed costs well.
Our 8% revenue growth was led by NII improvement as we continue to recognize more of the value of our deposit book.
And while revenue grew, expense declined by 1% year over year, generating over 900 basis points of operating leverage.
This expense discipline has now driven our cost of deposits to an industry-leading 111 basis points.
Net charge-offs declined and we had $380 million of reserve release in the quarter.
This allowed Wealth Management to generate more than $4 billion in earnings in 2021, up more than 40% from 2020.
Q4 net income was $1.2 billion, improving 47% year over year and driven by strong revenue growth, good expense controls, and lower credit costs.
Revenue growth of 16% was led by strong improvements in both AUM and brokerage fees, as well as higher NII on the back of solid loan and deposit increases.
Expenses increased 8% in alignment with the higher revenue and resulted in 800 basis points of operating leverage.
Client balances of $3.8 trillion rose $491 billion, up 15% year over year, driven by higher market levels, as well as very strong net client flows of $149 billion.
Within these flows, deposits grew $68 billion year over year to $390 billion, and loans grew $21 billion year over year to $212 billion.
This quarter, Merrill Lynch's net new households of 6,700 and private banking relationships net new of 500 were both up more than 30% from the year-ago period.
Net income for the full year was a record $9.8 billion or 31% of the company's overall net income.
The business earned $2.7 billion in Q4, improving nearly $1 billion year over year, driven by higher revenue and lower provision costs, partially offset by higher expenses.
Revenue improvement of 24% year over year reflected more than 30% growth in investment banking fees in this segment, and net interest income increased 18%.
3 ranking in overall fees in what was a very strong Q4 market.
1 in investment grade and No.
2 in leverage finance with market share improvement compared to the year-ago period.
Provision expense reflected a reserve release of $435 million, compared to a $266 million release in the year-ago period.
And what I'd draw your attention to here is the reduction in net charge-offs year over year from $314 million in Q4 of '20 to small recoveries in Q4 '21.
Finally, given the strength of revenue we saw expenses increase by 12%, which is still only half of our increase in revenue.
Full-year net income of $4.6 billion reflects another solid year of sales and trading revenue.
This included a record year for equities, up 19% versus 2020.
In Q4, global markets produced $667 million in earnings, $167 million lower than the year-ago quarter.
Sales and trading contributed $2.9 billion to revenue, a decline of 4% year over year.
FICC, down 10%, while equities improved 3%.
Finally, on Slide 21, we show all other, which reported a loss of $673 million, which declined a little more than $250 million from the year-ago period.
For the full year, the effective tax rate was 6%.
And excluding the second quarter '21 positive tax adjustment triggered by the U.K. tax law change, and other discrete items, the tax rate would have been 14%.
Further adjusting for ESG tax credits, our tax rate would have been 25%.
And looking forward, we would expect our effective tax rate in 2022 to be between 10% and 12%, absent any tax law changes or unusual items.

Summary:
Today, we reported $7 billion in after-tax net income or $0.82 per diluted share.
We have $1.4 trillion in deposits from all American consumers.
In global banking, we had record years of investment banking fees combined with strong GTS results.
Another economic signpost worth noting with our customer activity was acceleration of loan growth in the fourth quarter.
As Brian noted, we produced $7 billion in net income, which grew 28% from fourth quarter '20, while earnings per share of $0.82 improved at a faster 39% pace due to our share repurchases.
Looking at our top-line improvement on a year-over-year basis, revenue rose 10%.
During the quarter, the balance sheet grew $85 billion to a little less than $3.2 trillion, and this reflected the $100 billion of growth in deposits.
Given our deposit growth, our supplemental leverage ratio declined to 5.5% versus a minimum requirement of 5%, which still leaves plenty of capacity for balance sheet growth.
So focusing on the change on an FTE basis, net interest income increased $1.2 billion from Q4 '20 or 11%, driven by deposit growth and related investing of liquidity.
Premium amortization declined roughly $100 million to $1.3 billion in Q4, and the positive NII impact of lower premium amortization offset lower PPP fees.
Our Q4 expenses were $14.7 billion, an increase of $291 million from Q3.
The asset quality of our customers remains very healthy and net charge-offs this quarter fell to a historical low of $362 million or 15 basis points of average loans.
They continued a steady decline through the quarters of 2021, with Q4 down $100 million from Q3 and down more than $500 million from Q4 last year.
Provision was a $489 million net benefit in Q4, driven primarily by asset quality, and macroeconomic improvement, and was partially offset by loans growth.
Expenses increased 8% in alignment with the higher revenue and resulted in 800 basis points of operating leverage.