Terms

Series

Series QQ

Liquidation Preference

$25.00

Coupon Rate

4.25%

Rate Type

Fixed

Annual Dividend

$1.06

Payment Frequency

Quarterly

Cumulative

No

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

November 17, 2026

First Call Price

$25.00

Redemption Notice Period

30 days

Capital Stack Ranking

Junior To: All Existing And Future Indebtedness Of Bank Of America Corporation, Claims Of Subsidiary Creditors (Structural Subordination As Holding Company Issuer); Pari Passu With: Series B Preferred Stock, Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series L Preferred Stock, Series U Preferred Stock, Series X Preferred Stock, Series Z Preferred Stock, Series Aa Preferred Stock, Series Dd Preferred Stock, Series Ff Preferred Stock, Series Gg Preferred Stock, Series Hh Preferred Stock, Series Jj Preferred Stock, Series Kk Preferred Stock, Series Ll Preferred Stock, Series Mm Preferred Stock, Series Nn Preferred Stock, Series Pp Preferred Stock, Series 1 Preferred Stock, Series 2 Preferred Stock, Series 4 Preferred Stock, Series 5 Preferred Stock; Senior To: Common Stock, Any Capital Stock Expressly Junior To The Preferred Stock

Regulatory (Basel III) Call

Yes

Tax Classification

Qualified Dividend

Qualifies for QDI

Yes

Qualifies for DRD

Yes

Depositary Share Fraction

0.001

Shares Offered

52,000,000

Prospectus Summary

Bank of America Corporation is offering 52,000,000 depositary shares (NYSE: BAC PrQ), each representing a 1/1,000th interest in a share of its perpetual 4.250% Non-Cumulative Preferred Stock, Series QQ, with a liquidation preference of $25 per depositary share. The fixed annual dividend is $1.0625 per depositary share ($0.265625 per quarter), payable on February 17, May 17, August 17, and November 17, beginning February 17, 2022. Critically, dividends are non-cumulative: if the board does not declare a dividend for any period, that payment is permanently forfeited with no obligation to make it up in the future. The Series QQ Preferred Stock ranks senior to Bank of America's common stock and any junior stock, and pari passu with its extensive existing preferred stock complex (Series B through Series 5). It ranks junior to all of the corporation's debt obligations. Because Bank of America Corporation is a holding company, investors face structural subordination — the Preferred Stock has no direct claim on the assets of Bank of America, N.A. or other operating subsidiaries, whose creditors are paid first. Additionally, BAC may redeem all (not part) of the shares within 90 days of a 'capital treatment event' — if a regulatory change causes the stock to lose its Additional Tier 1 capital qualification — at par plus accrued dividends, potentially forcing redemption at an inopportune time for investors. At the $25 liquidation preference, the effective yield is 4.250% annually. Dividends are paid quarterly on the 17th of February, May, August, and November, with the record date set as the first day of the calendar month in which each payment date falls. As dividends from a C-corporation, they are expected to qualify for the preferential 15%/20% qualified dividend income (QDI) rate for individual holders and the dividends-received deduction (DRD) for eligible corporate holders, though this is not explicitly confirmed in the excerpt provided. The dividend stopper provision means that if Series QQ dividends were not paid in full for any preceding period, Bank of America would be prohibited from paying dividends on or repurchasing its common stock until compliance is restored.

Summarized from the SEC prospectus filing.

Distribution History

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If Bank of America has not paid full dividends on the Series QQ Preferred Stock for the immediately preceding dividend period, it is blocked from paying dividends on or repurchasing its common stock or any other junior stock, and from repurchasing parity preferred stock (except on a pro rata basis).

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 68 (Strong)