Correction: Fitch Places Bank of America's Individual Rating on Rating Watch Positive

CHICAGO--(BUSINESS WIRE)--(This is a correction of a release issued earlier today. It corrects the preferred stock rating given for BAC in the second paragraph to 'B+' from 'BB-'.)

Fitch Ratings has placed its 'D' Individual ratings for Bank of America Corp. (BAC) and its operating subsidiaries on Rating Watch Positive. Fitch has affirmed the Issuer Default Ratings (IDRs) of BAC and its subsidiaries, which are derived from U.S. government support and continue to carry a Stable Rating Outlook. Ratings of long and short-term deposits, long-term and short-term debt, and subordinated debt (with the exception of First Republic Bank; see below) are affirmed. These debt instruments are linked to BAC's IDRs, which are in turn dependent upon U.S. government support.

BAC's overall risk profile has begun to improve, with the potential for requiring additional government support or needing to omit dividends on preferred stock beginning to recede. Accordingly, Fitch has upgraded the preferred stock rating of BAC to 'B+' from 'B'. At the same time, Fitch has placed all preferred and trust preferred ratings of BAC and its affiliates on Rating Watch Positive. The lower notching applied to preferred stock compared to trust preferred stock reflects the fact that preferred stock is the most junior debt instrument in the company's capital structure.

BAC was able to tap the equity markets in the second quarter of 2009 (2Q'09) and has accessed the external debt markets a number of times since June of this year. BAC also converted a considerable portion of its preferred stock held by non-governmental investors to common through voluntary exchange offers.

Nonetheless, numerous challenges remain. The company is in the process of seeking a successor to its current CEO, and the choice of a successor may influence BAC's overall future strategy and business model. Earnings remain under pressure, as BAC posted a narrow loss to common shareholders in the most recent quarter after noncash and nonrecurring items are factored out. Asset quality problems remain severe, with loan loss provisions remaining high. However, with a recent slower rate of deterioration in problem assets the pace of reserve build has begun to decelerate, which could indicate the potential for a near-term peak in problem assets.

Management has stated its intention to repay preferred stock held by the government. Fitch's expectation is that management will use a combination of cash on hand and external financing to generate funds for any near term repayment of preferred stock.

This rating action does not cover subordinated debt and trust preferred securities issued by BAC unit First Republic Bank, which is in the process of being sold. Ratings actions on debt issued by First Republic Bank are discussed in a separate Rating Action Commentary published today.

Fitch has taken the following rating actions:

Bank of America Corporation

--Long-term debt guaranteed by TLGP affirmed at `AAA';

--Short-term debt guaranteed by TLGP affirmed at `F1+';

--Long-term IDR affirmed at `A+';

--Long-term senior debt affirmed at `A+';

--Long-term subordinated debt affirmed at `A';

--Preferred stock upgraded to `B+' from `B' and placed on Rating Watch Positive;

--Short-term IDR affirmed at 'F1+';

--Short-term debt affirmed at `F1+';

--Individual Rating of `D' placed on Rating Watch Positive;

--Support affirmed at '1';

--Support Floor affirmed at `A+'.

Bank of America N.A.

--Long-term debt guaranteed by TLGP affirmed at `AAA';

--Short-term debt guaranteed by TLGP affirmed at `F1+';

--Long-term deposits affirmed at `AA-';

--Long-term IDR affirmed at `A+';

--Long-term senior debt affirmed at `A+';

--Long-term subordinated debt affirmed at `A';

--Short-term IDR affirmed at 'F1+';

--Short-term debt affirmed at `F1+';

--Individual Rating of `D' placed on Rating Watch Positive;

--Support affirmed at '1';

--Support Floor affirmed at `A+'.

Banc of America Securities Limited

--Long-term IDR affirmed at `A+';

--Short-term IDR affirmed at 'F1+'.

Banc of America Securities LLC

--Long-term IDR affirmed at `A+';

--Short-term IDR affirmed at 'F1+'.

B of A Issuance B.V.

--Long-term IDR affirmed at `A+';

--Long-term senior debt affirmed at `A+';

--Long-term subordinated debt affirmed at `A';

--Support affirmed at '1'.

Bank of America Georgia, N.A.

Bank of America Oregon, National Association

Bank of America California, National Association

--Long-term IDR affirmed at `A+';

--Short-term IDR affirmed at 'F1+';

--Individual Rating of `D' placed on Rating Watch Positive;

--Support affirmed at '1';

--Support Floor affirmed at `A+'.

Bank of America Rhode Island, National Association

--Long-term IDR affirmed at `A+';

--Short-term IDR affirmed at 'F1+';

--Long-term deposits affirmed at `AA-';

--Short-term deposits affirmed at `F1+';

--Individual Rating of `D' placed on Rating Watch Positive;

--Support affirmed at '1';

--Support Floor affirmed at `A+'.

FIA Card Services N.A.

--Long-term IDR affirmed at `A+';

--Short-term IDR affirmed at 'F1+';

--Long-term deposits affirmed at `AA-';

--Short-term deposits affirmed at `F1+';

--Short-term debt affirmed at `F1+';

--Long-term senior debt affirmed at `A+';

--Long-term subordinated debt affirmed at `A';

--Individual Rating of `D' placed on Rating Watch Positive;

--Support affirmed at '1';

--Support Floor affirmed at `A+'.

MBNA Canada Bank

--Long-term IDR affirmed at `A+';

--Long-term senior debt affirmed at `A+';

--Long-term subordinated debt affirmed at `A';

--Short-term IDR affirmed at 'F1+'.

MBNA Europe Bank Ltd.

--Long-term IDR affirmed at `A+';

--Long-term senior debt affirmed at `A+';

--Long-term subordinated debt affirmed at `A';

--Short-term IDR affirmed at 'F1+';

--Individual Rating of `D' placed on Rating Watch Positive;

--Support affirmed at `1.

LaSalle Bank Corporation

--Long-term IDR affirmed at `A+';

--Short-term IDR affirmed at 'F1+';

--Individual Rating of `D' placed on Rating Watch Positive;

--Support affirmed at '1';

--Support Floor affirmed at `A+';

LaSalle Bank N.A.

LaSalle Bank Midwest N.A.

United States Trust Company N.A.

Countrywide Bank FSB

--Long-term deposits affirmed at `AA-';

--Short-term deposits affirmed at `F1+'.

Merrill Lynch & Co., Inc.

--Long-term IDR affirmed at `A+';

--Long-term senior debt affirmed at `A+';

--Long-term subordinated debt affirmed at `A';

--Preferred stock upgraded to `B+' from `B' and placed on Rating Watch Positive;

--Short-term IDR affirmed at 'F1+';

--Short-term debt affirmed at `F1+';

--Individual Rating of `D' placed on Rating Watch Positive;

--Support affirmed at '1';

--Support Floor affirmed at `A+'.

Merrill Lynch International Bank Ltd.

--Long-term IDR affirmed at 'A+';

--Short-term IDR affirmed at `F1+';

--Individual Rating of `D' placed on Rating Watch Positive;

--Support affirmed at '1'.

Merrill Lynch S.A.

--Long-term IDR affirmed at `A+';

--Long-term senior debt affirmed at `A+';

--Support affirmed at '1'.

Merrill Lynch & Co., Canada Ltd.

--Short-term IDR affirmed at 'F1+';

--Short-term debt affirmed at `F1+'.

Merrill Lynch Canada Finance

--Long-term IDR affirmed at `A+';

--Long-term senior debt affirmed at `A+';

--Short-term IDR affirmed at 'F1+';

--Individual Rating of `D' placed on Rating Watch Positive;

--Support affirmed at '1'.

Merrill Lynch Japan Finance Co., Ltd.

--Long-term IDR affirmed at `A+';

--Long-term senior debt affirmed at `A+';

--Short-term IDR affirmed at 'F1+';

--Short-term debt affirmed at `F1+';

--Support affirmed at '1'.

Merrill Lynch Japan Securities Co., Ltd.

--Long-term IDR affirmed at 'A+';

--Short-term IDR affirmed at `F1+';

--Support affirmed at '1'.

Merrill Lynch Finance (Australia) Pty LTD

--Short-term IDR affirmed at `F1+';

--Commercial Paper affirmed at `F1+'.

BankAmerica Corporation

--Long-term senior debt affirmed at `A+';

--Long-term subordinated debt affirmed at `A';

--Preferred stock upgraded to `B+' from `B' and placed on Rating Watch Positive.

Countrywide Financial Corp.

--Long-term senior debt affirmed at `A+';

--Long-term subordinated debt affirmed at `A'.

Countrywide Home Loans, Inc.

--Long-term senior debt affirmed at `A+'.

FleetBoston Financial Corp

--Long-term subordinated debt affirmed at `A'.

LaSalle Funding LLC

--Long-term senior debt `A+'.

MBNA Corp.

--Long-term senior debt affirmed at `A+';

--Long-term subordinated debt affirmed at `A';

--Short-term debt affirmed at `F1+'.

NationsBank Corp

--Long-term senior debt affirmed at `A+';

--Long-term subordinated debt affirmed at `A'.

NationsBank, N.A.

--Long-term senior debt affirmed at `A+'.

NCNB, Inc.

--Long-term subordinated debt affirmed at `A'.

BAC Capital Trust I - VIII

BAC Capital Trust X - XV

--Trust preferred securities of `BB-' placed on Rating Watch Positive.

BAC AAH Capital Funding LLC I - VII

BAC AAH Capital Funding LLC IX - XIII

BAC LB Capital Funding Trust I - II

--Trust preferred securities of `BB-' placed on Rating Watch Positive.

BankAmerica Capital II, III

BankAmerica Institutional Capital A, B

BankBoston Capital Trust III-IV

Barnett Capital Trust III

Countrywide Capital III, IV, V

Fleet Capital Trust II, V, VIII, IX

MBNA Capital A, B, D, E

NB Capital Trust II, III, IV

--Trust preferred securities of `BB-' placed on Rating Watch Positive.

Merrill Lynch Preferred Capital Trust III, IV, and V

Merrill Lynch Capital Trust I, II and III

--Trust preferred securities of `BB-' placed on Rating Watch Positive.

Additional information is available at 'www.fitchratings.com'.

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