2009 Neighborhood Lending Kathy Cummings, SVP Consumer Education and Counseling Executive

1. 2009 Neighborhood Lending Kathy Cummings, SVP Consumer Education and Counseling Executive

2. Bank of America • Financial Strength • Supporting Customers • Supporting Businesses • Supporting Communities • 2008 net revenue $74 billion • 2008 net income $4 billion • Tier 1 Capital Ratio (1/09 est. pro-form) 10.7% • In the fourth quarter of 2008, we: • Originated more than $60billionin new loans for consumers, including • Opened 380,000 net new savings accounts • $45billionin mortgages • $5billionin home equity • $2billionfor vehicles, boats, RVs • $8billionin domestic card and unsecured consumer credit • $800 million in student loans • Opened 130,000 net new checking accounts • Opened 380,000 net new savings accounts • Opened nearly 400,000 Risk Free CDs • Grew overall retail core deposits by 15% year-over-year • In the fourth quarter of 2008, we: • Made $49 billion in commercial loans • Made $7billion in commercial real estate loans • Extended nearly $1billion in new credit to more than 47,000 small business customers • Grew overall commercial deposits by 12% year-over-year • Raised more than $30.6 billion in debt and equity capital for our clients • In the fourth quarter of 2008, we: • Originated more than $11 billion in mortgages for more than 77,000 low-to-moderate income borrowers • In 2008, we: • Modified nearly 230,000 home loans, representing more than $44billion in mortgage financing • Modified nearly 850,000 credit card loans for borrowers experiencing financial hardship • Donated $200 million to non-profit institutions supporting critical community needs • Delivered more than $450 million in loans and investments to Community Development Financial Institutions • And our associates: • Volunteered more than 900,000 hours in our communities • Donated more than $25 million to charitable organizations, matched by Bank of America’s Matching Gift Program

3. Vision, Objectives and Strategic Agenda Vision and Mission 2009 Objectives Key Environmental Factors Key Internal Factors Be America’s #1 most admired and most trusted home lender inclusive of meeting the needs of Low-to-Moderate families, minorities and under-served communities seeking to achieve and sustain homeownership • Grow LMI/MM franchise • Maintain CRA Outstanding Rating • Optimize expense and productivity • Loss mitigation • Deliver world-class LMI/MM customer experience through a well balanced and diversified associate base • Deliver best in class home buyer education and counseling • Consumer mindset/behavior change • Significant changes in public policy • Significant unemployment and underemployment impact among LMI/MM customers in priority markets • Uncertainty in GSEs position and changes in competitive landscape • High delinquencies/foreclosures, continued declines in home prices • Elimination of seller-funded programs and reduction in available state and local down payment/Bond programs • Creating a DNA CRA mindset within business: • Integrated channel strategy • Inclusion in customer segment strategies • Systemic support to accurately track LMI and MM performance Strategic Agenda Assume industry leadership role in defining responsible lending Optimize business model and maximize revenue Drive CRA Modernization Maintain top LMI and MM market position

4. Change in Lending Landscape • 2006: Today: • Option ARMs No Option ARMs • Alternative Doc No Alternative Docs • NINA • VOA • SISA • 100% LTV/CLTV 95% LTV/CLTV (90% in declining markets) • 580 minimum FICO 660 minimum FICO • 50% DTI 45% DTI • 0-2 months reserve requirements 2 months reserve requirements • depending on ratios and product • Interest Only / Negative Amortization Rarely an option/more conservative terms • 40 Year Terms Additional charge for 40 year term • Piggy-Back Mortgages Rarely an option • Homebuyer Education sporadic Homebuyer Education needed on more products

5. Market Realities (NAR 4th Quarter 2008 Report) • National Association of Realtors reports that home prices dropped a record 12.4% in the final quarter of 2008 - the biggest year-over-year decline in 30 years. • The median price for a U.S. home sold during the fourth quarter of 2008 fell to $180,100, down from $205,700 during the last quarter of 2007 • Distressed properties have flooded (foreclosures and short sales) the market accounting for 45% of all deals. • The vast majority of metropolitan areas, 134 out of 153, recorded price declines compared with the last quarter of 2007 • Many sales were in low- and moderate-income housing developments where buyers during the boom years financed their purchases using subprime mortgages. In higher-end areas, fewer exotic mortgages were used which are skewing the results for median home prices. People who can are staying put. • In Cape Coral-Ft. Myers, FL, which has the third highest rate of foreclosure filings in the nation, according to RealtyTrac, prices fell a devastating 50.8% for the year, to $110,900 from $225,300. That was the most precipitous plunge for any metro area. • In Saginaw, MI, prices fell 41.4%; Riverside-San Bernardino, CA, prices dropped 40.8%; and San Jose, CA, prices declined 37.7%. • The Beaumont-Port Arthur area of Texas bucked the national trend. Its median home price jumped 16.7% to $132,600 - the highest increase in the nation. Other winners included Bloomington, IL, up 9.6%; Dover, DE, up 6.5%; and Bismarck, ND, up 6%.

6. Changing Housing Landscape (Information from Zillow.com) • 1 in 6 homes have negative equity • A shocking ~28% of 2008 purchases have negative equity • The median down payment has averaged ~10% since 2001 (down from ~18% in 2000) • Due to MI coverage, it may actually be beneficial to put less money down (agency loan with an 85% LTV cheaper than 80% LTV) • 1 out of 5 sales are on foreclosed properties • A staggering 42% of homes sold right now are at a loss • Even with all of the stays in foreclosure, we’re on an upward trend and sit slightly north of 20%

7. Study Your Market - http://www.zillow.com/reports/RealEstateMarketReports.htm

8. The New Creative Financing • Identify DAP and Bond options for your market • Work with borrowers on increasing their credit score (on an agency loan you can reduce your points by up to 1.25 with a 680 versus a 660 FICO). • Establish savings patterns to help build reserve requirements and down payment • REO acquisition opportunities • Lease to Own opportunities • Assumable mortgages or short sales • Attempt to identify who the investor is to fully understand bargaining power • An assumption does not relieve the original borrower of responsibility for the obligation unless a substitution of liability is executed • $8000 tax credit highlights include: • The $8000 tax credit is available only to first-time home buyers on their primary residence between January 1, 2009 and December 1, 2009 • The $8000 tax credit does not require repayment • The $8000 tax credit is claimed on a tax return and reduces the tax liability. If the credit is more than the tax liability, the unused credit will be issued as a check to the person claiming the credit • If you sell the home within 3 years, the entire $8000 tax credit is recaptured