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Return on Average Tangible Common Shareholders’ Equity (ROTCE) ($ in millions)
ROTCE is computed by dividing net earnings applicable to common shareholders by average monthly tangible common shareholders' equity. Management believes that ROTCE is meaningful because it measures the performance of businesses consistently, whether they were acquired or developed internally. ROTCE is a non-GAAP measure and may not be comparable to similar non-GAAP measures used by other companies.
Three Months Ended March 2013 (1)
Year Ended December 2012 ROTCE (2)^ 13.4 % 11.6 %
(1) (^) March 2013 ratio is annualized.
(2) (^) The table below presents the reconciliation of average total shareholders’ equity to average tangible common shareholders’ equity.
Average for the
Three Months Ended March 2013
Year Ended December 201 2 Total shareholders' equity $ 7 6,702 $ 72 , Preferred stock (6,200) (4,392) Common shareholders' equity $ 70,502 $ 68, Goodwill and identifiable intangible assets (4,980) (5,337) Tangible common shareholders’ equity $ 6 5,522 $ 62,
Adjusted Assets, Adjusted Leverage Ratio, Tangible Common Shareholders’ Equity, Tangible Book Value Per Common Share and Tier 1 Common Ratio
($ in millions, except per share amounts)
The table below presents information on the firm's assets, shareholders’ equity, leverage ratios, book value per common share and Tier 1 common ratio.
March 2013
December 2012 Total assets $ 959,223 $ 938, Adjusted assets (1)^ 689,034 686,
Total shareholders’ equity $ 77,228 $ 75, Leverage ratio (2)^ 12.4 x 12.4 x
Adjusted leverage ratio (3)^ 8.9 x 9.1 x
Common shareholders’ equity $ 71,028 $ 69, Tangible common shareholders’ equity (4)^ 66,345 64,
Book value per common share (5)^ $ 148.41 $ 144. Tangible book value per common share (4) (5)^ 138.62 134.
Risk-weighted assets (RWAs) (6)^ $^ 480,080 $^ 399, Tier 1 common ratio (7)^ 12.7 % 14.5 %
(1) (^) Adjusted assets equals total assets less (i) low-risk collateralized assets generally associated with the firm’s secured client financing transactions, federal funds sold and excess liquidity (which includes financial instruments sold,
but not yet purchased, at fair value, less derivative liabilities) and (ii) cash and securities segregated for regulatory and other purposes. Adjusted assets is a non-GAAP measure and may not be comparable to similar non-GAAP measures used by other companies. The table below presents the reconciliation of total assets to adjusted assets.
March 2013
December 2012
Total assets $ 959,223 $ 938,
Deduct: Securities borrowed (172,041) (136,893) Securities purchased under agreements to resell and federal funds sold (158,506) (141,334)
Add: Financial instruments sold, but not yet purchased, at fair value 153,749 126,
Less derivative liabilities (52,347) (50,427) Subtotal (229,145) (202,010)
Deduct: Cash and securities segregated for regulatory and other purposes (41,044) (49,671)
Adjusted assets $ 689,034 $ 686,
