Bank of America Corporation, through its subsidiaries, provides banking and financial products and services for individual consumers, small and middle-market businesses, institutional investors, large corporations, and governments worldwide. It operates through four segments: Consumer Banking, Global Wealth & Investment Management, Global Banking, and Global Markets. The Consumer Banking segment offers traditional and money market savings accounts, CDs and IRAs, noninterest- and interest-bearing checking accounts, and investment accounts and products, as well as credit and debit cards, residential mortgages and home equity loans, and direct and indirect loans. This segment provides its products and services through approximately 4,600 financial centers, 15,900 ATMs, call centers, and online and mobile platforms. The Global Wealth & Investment Management segment offers investment management, brokerage, banking, and retirement products, as well as wealth management and customized solutions. The Global Banking segment provides lending products and services, including commercial loans, leases, commitment facilities, trade finance, real estate lending, and asset-based lending; treasury solutions, such as treasury management, foreign exchange, and short-term investing options; working capital management solutions; and debt and equity underwriting and distribution, and merger-related and other advisory services. The Global Markets segment offers market-making, financing, securities clearing, settlement, and custody services, as well as risk management, foreign exchange, fixed-income, and mortgage-related products. Bank of America Corporation was founded in 1874 and is based in Charlotte, North Carolina.
Business Analysis of Bank of America
The Banking Sector is witnessing a major shakeup, new age business models in the industry are transforming both customers and businesses. Faced with this uncertainity, companies are investing resources to transform their business. An in-depth business analysis is a valuable resource to identify and articulate the need for a business model change. At R&P Research we believe, the starting point for a business analysis is Benchmarking. Business benchmarking can be done at various levels: 1) Industry Benchmarking 2) Peer Benchmarking 3) Disruptors Benchmarking. In this report, we share the snapshot of how Bank of America compares against the industry on the major performance indicators. This analysis, along with peer group/disruptors benchmarking and revenue model understanding can help identify growth and cost optimization opportunities to maximize the value delivered by Bank of America to its stakeholders. R&P Research Industry Intelligence Platform provides historical data for last 15 years with an easy to use benchmarking interface for an in-depth comparative business analysis.
Here is the performance snapshot of Bank of America with an interactive chart.
- Revenue Growth: Bank of America reported a revenue growth of 0.9% year-on-year during 2016. Banking Industry grew at 1.5% in the same period
- COGS share of Revenues: Bank of America COGS share of Revenues details are not available because either company does not share the data or we do not have it
- R&D share of Revenues: Bank of America R&D share of Revenues details are not available because either company does not share the data or we do not have it
- SG&A share of Revenues: As a percentage of revenue, Bank of America spent 64.8% of its total revenues on Sales, Marketing, and General Administration (SG&A). Banking industry average SG&A spending in the same period was 53.7%
- Inventory share of Revenues: Bank of America Inventory share of Revenues details are not available because either company does not share the data or we do not have it
- Accounts Payable share of Revenues: Bank of America Accounts Payable share of Revenues details are not available because either company does not share the data or we do not have it
- Accounts Receivable share of Revenues: As a percentage of revenue, Bank of America invested 70.2% of its total revenues on Accounts Receivable (A/R). Banking industry average Accounts Receivable investment in the same period was 30.1%
- PP&E share of Revenues: As a percentage of revenue, Bank of America invested 10.9% of its total revenues on Property, Plants, and Equipments (PP&E). Banking industry average PPE investment in the same period was 14.0%
- Intangibles share of Revenues: As a percentage of revenue, Bank of America invested 89.2% of its total revenues on Intangibles. Banking industry average Intangibles investment in the same period was 60.1%
- Net Margins: Bank of America Net Margins in the year 2016 were 21.4%. Banking industry average Net Margins in the same period were 23.5%
Sector and Industry Association of Bank of America
For the purpose of performance benchmarking of a company with a sector or industry average, R&P Research associates every company with one sector and one industry. An industry consists of companies with related/similar business models. A sector comprises of a group of related/similar industries. For high-level analysis purposes, related/similar sectors are grouped into sector groups.
Bank of America is associated with Financials Sector Group, Banking Sector, and Banking Industry.
Banking sector is comprised of a single industry: Banking. Its definition is as follows:
- Banking industry includes banks providing a broad range of financial services, including retail banking, loans and money transmissions.
Industry Ranking of Bank of America
With $83.7 billion revenues, Bank of America ranked number 3 of all the companies in the US Banking industry. There were a total of 179 public companies in the US Banking industry that had revenues greater than $50 million during 2016.
The top-10 companies in the US Banking industry by revenues during 2016 were:
- JPMorgan Chase ($95.7 billion)
- Wells Fargo ($84.5 billion)
- Bank of America ($83.7 billion)
- Citigroup ($69.9 billion)
- US Bancorp ($19.8 billion)
- PNC Financial Services Group ($15.2 billion)
- BB&T ($10.2 billion)
- SunTrust Banks ($8.2 billion)
- Fifth Third Bank ($6 billion)
- Regions Financial ($5.3 billion)
Business Model Analysis (BMA) Framework
We use the following framework to assess the business model of a company. Business Model Analysis framework can be used by organizations to articulate growth strategies and identify cost optimization opportunities. Technology and consulting companies can use this framework to identify the value drivers and pain points of their targeted customers. Entrepreneurs can use this framework to understand the language of business and identify promising business opportunities. This framework can be used by any professional aspiring to take up a leadership role to better understand the businesses challenges, articulate growth strategy, and monitor the business improvement requirements for the organization.
- Conduct a holistic benchmarking; to identify and target additional sources of value
- Get in touch with us to learn more about Business Model Analysis Framework
- Get free data, charts, and analysis of Bank of Americaand its peers on select key performance indicators by clicking the reports provided below