Executive Compensation Program Overview
Adjusted revenue, adjusted noninterest expense, adjusted pre-tax pre-provision profit, and
adjusted efficiency ratio
(in millions)
Revenue
Adjustments for notable items:
Divestitures
Adjusted revenue
Tangible Common Equity (including adjusted ROE and adjusted ROTCE)
Noninterest expense
Adjustments for notable items:
Operating losses related to litigation, regulatory, and customer remediation matters in third and
fourth quarters of 2022
Divestitures
Year ended
(in millions, except ratios)
Dec 31, 2022 Dec 31, 2021
Net income applicable to common stock
(A)
$73,785
78,492
Adjustments for notable items:
Change in the allowance for credit losses
2,970
Operating losses related to litigation, regulatory, and customer remediation
matters in third and fourth quarters of 2022
(B)
73,785
75,522
Divestitures
(C)
$57,282
53,831
Applicable tax effect related to notable items¹
Year ended
Dec 31, 2022
Dec 31, 2021
Dec 31, 2020*
(A)
12,067
20,256
1,786
(75)
(5,737)
5,249
1,294
Adjusted net income applicable to common stock
Average total equity
Adjustments:
5,249
(1,676)
859
(1,832)
(B)
16,382
14,675
Пa
183,224
191,219
184,689
Preferred stock?
Adjusted noninterest expense
(D)
52,033
52,537
Additional paid-in capital on preferred stock²
Efficiency ratio
(CIMA)
Adjusted efficiency ratio
(D)/(B)
7836
71%
69%
Unearned ESOP shares²
70%
Noncontrolling interests
Pre-tax pre-provision profit (PTPP)1
(A)-(C)
16,503
24,661
Adjusted PTPP
(B)-(D)
21,752
22,985
Average common stockholders' equity
Adjustments:
(19,930)
(21,151)
(21,364)
143
137
148
512
874
1,007
(2,323)
(1,601)
(769)
(C)
161,626
169,478
163,711
Goodwill
Management believes that PTPP is a useful financial measure because it enables investors and others to assess the Company's ability to generate capital to cover credit
losses through a credit cycle.
Certain identifiable intangible assets (other than mortgage servicing rights)
(25,177)
(190)
(26,087)
(26,387)
(294)
(389)
Goodwill and other intangibles on investments in consolidated portfolio
companies (included in other assets)
Adjusted net income
Year ended
Applicable deferred taxes related to goodwill and other intangible assets³
(2,359)
864
(2,226)
867
(2,002)
834
(in millions)
Dec 31, 2022
Dec 31, 2021
Average tangible common equity
(D)
134,764
141,738
135,767
Net income
$13,182
21,548
Return on average common stockholders' equity (ROE)
(A)(C)
7.47%
Adjustments for notable items:
Adjusted ROE
(BIC)
10.14%
11.95%
8.66%
1.10%
n/a
Change in the allowance for credit losses
(75)
(5,737]
Operating losses related to litigation, regulatory, and customer remediation matters in third and fourth
quarters of 2022
Return on average tangible common equity (ROTCE)
(A)/(D)
8.95%
Adjusted ROTCE
(BIVIDI
12.16%
14.29%
10.35%
1.30%
Пa
5,249
Divestitures
Applicable tax effect related to notable items!
859
(1,676)
(1,832)
A reconciliation for 2020 is included for purposes of the Pay Versus Performance table and discussion.
Determined by applying the combined federal statutory rate and composite state income tax rates to notable items in 2022 and 2021
Adjusted net income
17,498
15,967
Determined by applying the combined federal statutory rate and composite state income tax rates to notable items in 2022 and 2021.
In fourth quarter 2022, we redeemed all outstanding shares of our ESOP Cumulative Convertible Preferred Stock in exchange for shares of the Company's common
stock
Determined by applying the combined federal statutory rate and composite state income tax rates to the difference between book and tax basis of the respective
goodwill and intangible assets at period end.
Adjusted diluted earnings per common share
Year ended
Dec 31, 2022 Dec 31, 2021
$3.14
4.95
Diluted earnings per common share (EPS)
Adjustments for notable items:
Change in the allowance for credit losses
(0.01)
(1.40)
Operating losses related to litigation, regulatory, and customer remediation matters in third and fourth
quarters of 2022
1.37
Divestitures
(0.41)
Applicable tax effect related to notable items!
0.23
(0.45)
Adjusted diluted EPS
4.27
3.59
(1)Determined by applying the combined federal statutory rate and composite state income tax rates to notable items in 2022 and 2021
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