Bank Of America CEO Brian Moynihan on his response to coronavirus

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CNBC transcript: Bank of America CEO Brian Moynihan Speaks with CNBC’s Jim Cramer on “Squawk on the Street” today on the bank’s response to coronavirus.

WHEN: Today, Friday, April 3, 2020

WHERE: CNBC’s “Squawk on the Street

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BofA CEO Brian Moynihan on the bank’s response to coronavirus


JIM CRAMER: Alright, why don’t we bring in Bank of America CEO Brian Moynihan now? Brian, wow, we’re talking to you a lot because you are, you’re at the epicenter, your bank is at the epicenter of trying to get America moving again. Could you tell us whether there are already thousands of people going to Bank of America and saying, Listen, ‘I want some of that act, I want that grant, I want that loan’? Where are we as of this morning?

BANK OF AMERICA CEO BRIAN MOYNIHAN: Well, Jim, thank you for allowing me to join you again. Just first off, we have got to remember, this law was not enacted until late in the afternoon last Friday. So, a week later, through the hard work of Treasury and all the people there working on this, the hard-working industry, we are now taking applications and we’re about 10,000 applications this morning. And my colleagues across the industry had a call this morning.

We’re setting up to take the applications. I think it’s a testimony to the speed at which we can move. So, speed is of the essence for small businesses. The PPP is meant to keep their payroll consistent. Going against some of the discussion you were just having on jobs and other impacts in the economy, which we expect to see in April. And you’re seeing the money will start to go out the door once the applications are processed over the next short period of time.

JIM CRAMER: Brian, we’ve got a common enemy in COVID-19. And I’m wondering if I went to my bank right now, to my Bank of America branch, and I’m a client, would I find someone? Because you’ve had to put people in different places just so that they don’t get sick. I know how much you care about your associates and employees. Are there enough people at the bank that I could go in and say, ‘Listen, this -- I want to obtain a paycheck protection program, how do I do it?’

BRIAN MOYNIHAN: Sure. There are teammates, our branches are open. We’ve kept them consistently open because we’re one of the essential industries. Our teammates are being safe in those branches. We’re taking great care to make sure they get the social distancing and the cleaning and everything they do. But they’re open every day. Just to give an example, I think on Monday or Tuesday this week, you were seeing $700 million in cash – $6-700 million in cash – go out over the tele-line and through the ATM. So, they’re open and functioning. Our teammates there are ready to serve.

But most importantly, though, the nice thing is the team worked all night last night to get a digital app up. And so, this program can be done completely digital. And right now, we’re focused on our borrowing clients. We want, as the Treasury Secretary has said and as the industry has said, we want everybody to go to their borrowing bank. Because that will be easier to process and be able to process faster.

There are certain customers out there that will be eligible for the program that don’t borrow. We’ll process them also. But first, we have to focus on the borrowing clients to make sure we can take care of them. That’s a core relationship bank if you think of the 4,000 banks in America and all the clients that are eligible for this, if they go back to their relationship bank, it will be easier to get them through the process faster. And then secondly the people with the core relationship that don’t borrow, we’ll handle them also.

JIM CRAMER: I think it’s important to point out, your app is the most popular of all the bank’s apps. That’s unbelievable it’s already up. And it’s not just a millennial app. I think there’s a huge number of people who use it. How simple is that? Is that just the--does it explain everything? You know, Brian, I had to hire someone to understand exactly what I could get for my businesses. Is the app more – is it explicit?

BANK OF AMERICA CEO BRIAN MOYNIHAN: Yeah. You -- well, the core banking app, we stood up a new piece, obviously, because this is a new program. Literally, it is less than a week old. Regulation just came out late last night. So, the team has done a spectacular. It explains the process. It takes the application. We’re trying to make sure it’s fully operational behind the scenes. And you know, that takes a little more work. We’re continuing to work on it. But if a customer goes in, they can find the app and our business customers can go onto their, what we call cash pro, which is their online app and they can see a button and press on it and get to the application period. It is within the broad And so the people on the mobile apps and stuff have other access.

JIM CRAMER: Brian, where are we right now? When do you think we’ll be open for business? You’ve got -- you’re in touch with more businesses and individuals than pretty much anyone in the country. And I know you and are both concerned that the enemy that is COVID-19 has us on the run right now. When do you think we’ll get it on the run?

BANK OF AMERICA CEO BRIAN MOYNIHAN: Well, I think, as we saw in the month of March and you’re talking about it, the impact to all the types of businesses--restaurants and the hairdressers and doctors who are not involved in this -- directly in the fight here, shutting down their offices. The orders by 90-95% of the population. March was really different each week. From the beginning of March to the end of March, the amount of money that flowed through the company by our consumers went from around $60 billion a week to $mid-40 billion a week and that can bounce around depending on the week runs and where it is in the monthly cycle. But you saw it slow down.

The real question is how fast can we get those parts of the economy restarted? And that’s going to come by getting comfort about the testing and understanding the disease, all the things you were talking about earlier. That is still ahead of us. Obviously, the president issued an order that went through the end of April.

I think it’s going to be a while. Right now, the economy seems to be settling into a level that we’ll have to judge that we -- we can start to see emerge. We don’t know when it will be yet and we’ll keep you posted over the next few weeks. But to get the rest of 20 billion a week of payments, you’re going to need to see activities open up again. And that means winning the war on the virus.

JIM CRAMER: Brian, what do we see to the prospect of -- get to the point where the country is losing too many jobs and politicians say, you know what, it’s time for mortgage forbearance, where we don’t have to pay our mortgage, it’s time for rent forbearance. What happens? Because there are contracts in our country that made it such where it’s easy to get a mortgage, because mortgages are sacrosanct and ironclad. You have to pay. Student loans. What happens if people in Washington say you know what, Brian? You’re not allowed to -- tell your servicers they can’t get that money this month. Sorry. What happens to Bank of America?

BRIAN MOYNIHAN: Well, look, right now we’ve helped nearly a half a million customers defer their payments. And what we mean by that is for our mortgage customers, if you have your mortgage with us, we just tack it on the end. So, if it’s 28 years left on your mortgage, somewhere out there, 28 years from now if you don’t move, you don’t pay off your mortgage, or something like that doesn’t go on, you’ll have to make up the three payments that you made up in the summer here.

So, I think the idea is to defer the payment, defer the impact. But the real key of the CARES Act and this PPP and the different provisions and the unemployment provisions and even the cash provisions is to keep money in the hands of people so they can live – a) maintain themselves in the broadest context in terms of living, but also continue to pay their bills. The other question is I think incumbent upon employers like us, is keep the people employed, keep paying them, they should be able to pay their bills.

And I think We have to remember even though I gave you a half million, we have 66 million customers. So, there are a lot of customers who will be able to pay their bills and even in our mortgage, 30,000 customers or so, requested relief out of the hundreds of thousands we have. So, you’re not going to see -- a lot of people are getting paid, you saw that service to the economy. They’re still working, and they should pay their bills would be my advice to the people, not only to a policy question but also the fiscal management question. So, we’re working with people who are losing their jobs. We have to preserve the ability to have cash flow. And that’s what the CARES Act did. That’s what the PPP does. And we’re doing our best to help.

JIM CRAMER: Let’s say I have a small business and I say this you know what? This Bank of America is a pretty good bank. I’m going to set up an account and get my money through them. Are you ready to do that? Some say that it’s really for existing Bank of America accounts. You can’t go in there, open an account today and get things done.

BANK OF AMERICA CEO BRIAN MOYNIHAN: Yep, we are prioritizing. We have a million borrowing customers we’re trying to get through the system first. Then our second priority will be the customers who have the core operating account with us but don’t borrow anywhere. For those that borrow from the other 4,000 banks in the country, we’re trying to get them to go back to their bank, which is the priority the treasury put on it. Because a) the process is faster and b) you know, it spreads the work out and the obligation and will make the whole system go faster. If everybody shows up at bank a, b, or c, that means it’s going to slow down the process.

So my advice to customers is, if you borrow from us, you can apply on the application. If you have your relationship with us, but don’t borrow, the relationship managers will handle that. But, if you borrow with another bank, and when I talk with my colleagues in the industry, they’re all the same, please, go back and work with them. Because they’re your core bank and they know you the best and can process you the fastest.

JIM CRAMER: Alright. Brian. last question. We’re all trying to get united and we feel the same. We actually know people at this point who have died from it. I have lots of friends who know people who have died from it. Bank of America has been unique in the amount of charity that you’ve done, in the amount of money that you devoted, and the fact that you’re keeping people on the job. Just speak to what you -- you’re a very humble man. I’m going to put you on the spot. I know you don’t like to do this. Speak to some of the stuff you’re doing. Because I think people have to know, business is the greatest source of change in this country.

BANK OF AMERICA CEO BRIAN MOYNIHAN: Well, I think number one, you mentioned earlier, we’ve come at this on a customer-centric and a team-centric view. We’re trying to do everything we can to take care of, limit the number of teammates we have that have the disease or a family member has the disease and make sure they’re getting the best medical help. We continue to work, have like in our trading operations, only 5% of the people in the trading operations are actually at work. 95% of people trading from home. The team has done a fantastic job of deploying over 150,000 work from home positions. So, we’re complying with the social separation.

But if you think more broadly, we did $100 million of charitable giving. We’re implementing that through our 92-market presence. We’ve maintained our employment. We already announced that, as of last month, we went to 20 an hour minimum wage for everyone in our company. 401k contributions. We’ve waived the testing costs. We’ve waived things like that to help our employees. Child care, $100 plus a day for you to hire your cousin if they’re out of work to take care of your children so you can work for us.

Then on top of that, one thing I’m proud of is the team came to the decision yesterday, a few days ago that we told all our summer kids, you have a job, which I think is 1800 or 1600 of them. And we told our permanent kids, you have a job, no worries. How we’re going to put them to work will be interesting, if we’re still in a virtual condition. But that’s 3,000 kids that will be taken care of coming out of schools. And we’re proud of that.

JIM CRAMER: Well, that’s great to hear. I know a lot of kids coming out of school this year have no concept their jobs have been taken away. And all the things you’re doing are terrific. Best of look in trying to get all those applications finished. I know that’s what you want to do. And thank you for taking the pledge to not lay off people. Brian Moynihan, the Chairman and CEO of Bank of America. Always good to talk to you, sir.

BRIAN MOYNIHAN: Thank you, Jim.


Bank Of America CEO Brian Moynihan: The American Consumer Is Strong

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The following is the unofficial transcript of a CNBC EXCLUSIVE interview with Bank Of America CEO Brian Moynihan and CNBC’s Wilfred Frost which aired on CNBC’s “Squawk Alley” (M-F 11AM – 12PM) today, Tuesday, December 11th. The interview took place live at Goldman Sachs’ annual Financial Services Conference. The following is a link to video of the interview on

CEO of Bank of America transcript

WILFRED FROST: Jon, thanks so much for that. As you said here at the Goldman Sachs Financials Conference and joined by the Chairman and CEO of Bank of America, Brian Moynihan. Brian, great to see you as always. Thanks for joining us.

CEO OF BANK OF AMERICA BRIAN MOYNIHAN: Great to be here. Good to see you again.

WILFRED FROST: We heard from you this morning presenting at the conference and some other banks here, as very optimistic about the consumer it seems. Talk us through that. And then you have some unique data about how retail sales is going in the holiday period.

CEO OF BANK OF AMERICA: Well, you have to start a little bit from the structure. And the end of the day, U.S. economy is two-thirds, 70% consumer driven. So, if the U.S. consumer is doing well, we know the economy will do pretty well. And so, if you look at our spending just in general last year to this year, it’s up about 5.5% to 6%. And that’s across $3 trillion of card usage, of checks written, of cash out of the ATMs. So, it’s a big dataset. It’s grown faster through the year. Picked up a bit of pace.

So that’s good news. And then if you look at the holiday spending, you know, the Wednesday before Thanksgiving to Cyber Monday, up double digits, strong, people are spending. So, that’s good news for the U.S. economy. So, that helps sustain this long, long growth session we’ve had even longer. Because the U.S. consumer is employed, wages are growing and they will spend. It’s a terrific win in the sales of the U.S. economy.

WILFRED FROST: When you see the pickup has happened for the consumer, what do you think has driven that? Is it cyclical factors like rates being low? Or is it something structural that is meant during this cycle, the middle class has grown in overall wealth?

CEO OF BANK OF AMERICA BRIAN MOYNIHAN: At the end of the day, what’s driving it is the average consumer in America, there’s 330 million people, about 150 million of them work, they have a job. That job, they’re growing in promotions and doing things. A teammate that started in 2010 for us at $50,000 has had 10% per year salary and wage growth per year. They’re making more money and they’re spending it.

So, that’s happening across–if you look at the recent data, you’re seeing a faster growth rate in the median income level than we’ve seen so far in this recovery. So, that’s all good news. But it’s all driven by great employment, by America’s success in the worldwide economy, the ability to employ people, the ability to pay them more. And that’s what’s driving consumers to spend. That’s when they spend. They’re not going to spending if they’re worried about their job or worried about getting paid.

WILFRED FROST: Is the corporate sector weaker?

CEO OF BANK OF AMERICA BRIAN MOYNIHAN: The corporate sector is more muted. Largely–you really have to think about triangles. You know, the largest companies being in smaller numbers at the top, and the big base, the big businesses. We’re the largest lender to small business in the country. You know, loans grew, third quarter last year to third quarter this year, about 6,7, 8%, whatever it was. But shows you, there’s good robust activity. And the confidence level of those small, medium-sized businesses is okay. Because, they’re – the drip down a little bit came back up mostly because they’re exposed to the U.S. economy. When you get bigger, you have the trade issues, you have to worry about China slowdown, you have to worry about Europe sluggishness, Japan’s sluggishness, Brazil.

Because you’re involved in worldwide commerce, both in your – how you get your products to sell in the U.S., but also where you sell around the world. And so, our observation has been as you get higher up, the nervousness about what’s going on, but they’re still employing a lot of people, fighting to get people to do the work. But on the other hand, they’re borrowing a little less. The corporate loan growth rates slow down this quarter, largely because people are trying to figure out ‘When does this all mitigate?’

WILFRED FROST: We’ve got a Fed decision coming this afternoon. As we sit here today, compared to 12 months ago, we’ve seen the Fed ease significantly in the time in between. Given that optimistic view on the economy you just gave, are you surprised at the extent of their about-turn, of their pivot, since 12 months ago?

CEO OF BANK OF AMERICA: Well, I think they made it clear in the minutes that basically they have to be there to provide this insurance policy to make sure this very long recovery and growth cycle stays in there. And you know, if you look at the — Chair Greenspan in the ’90s and stuff, there have been times when you have to go in and help because of the impacts of trade, the impacts of things that are sort of outside the United States.

So, it’s not an observation by me to say they have put the insurance policy and they have said it. And I think now that they put enough in and I think they’ll hold. And that’s what the market says and that’s what we believe in the company.

WILFRED FROST: We’ve seen some price wars in the online brokers and it’s led to some consolidation. Do you fear that Charles Schwab — a beefed-up Charles Schwab, as it is, is now a major competitor in a way it wasn’t before to Meryl Lynch and Bank of America?

CEO OF BANK OF AMERICA BRIAN MOYNIHAN: It was always a major competitor. And so, we’ve been competing with them for years. So, you know, the whole zero-dollar trade I think came at people in a way that surprised me. Because in 2006, we had a red bus we rode around in lower Manhattan here and announced zero-dollar trades. It’s not a new concept. Hard to make revenue if you’re not charging. And so, that’s the thing you have to think about. But the way we do it is in conjunction with our broad partnership.

So, our preferred customers had it. 80% of our trades are free. This week we announced that we picked up some on the other piece. But largely, we want people to bring the whole relationship with us. And we feel we’re massively competitive on that. And you see the growth rate of the customers is very strong, no attrition, a very great rewards program across all their products and services. So, we tie it in the broader thing. We are not in a stand-alone, get a person who just trades. We’re into give us your full financial relationship and we’ll deliver the whole company for you.

WILFRED FROST: Similarly, in other areas of the tech you’ve invested in, it’s really delivering on the numbers. You released some this morning about the usage of Erica. Is it in a position now where you think it is better than any challenger that’s out there?

CEO OF BANK OF AMERICA: Well, it’s better — we believe our products and services are better than any challenger and any mainstream competitor, whatever characterization you want to put. We study everybody, we see what customers need. But the real difference is our ability to invest at scale and to get scale out of our investments. So, we have 35 million round numbers of digital customers, 29 million mobile customers. In the third quarter, the mobile customers did a billion and a half interactions with us and set up 600,000 appointments at our branches. So, you have to have high touch and high tech in the interplay.

30% of our sales are digital. But the important thing is, if we invest a dollar per customer, it’s 35 million dollars. I we invest a dollar per mobile customers, it’s 29 million dollars. So, we can heavily sustain that competitive edge. Erica is an example of that. Just crossed 10 million. 65 million customer interactions, unique product. And so, we think we can be competitive with everybody. And by the way. we study the competition. We have to beat them.

WILFRED FROST: I mean, given all of that, and scale has become so, so important. Tech is a leading part of that. If you were on the board of a regional bank, what would you advise them to do? And how are they going to compete with the scale that you so clearly have?

CEO OF BANK OF AMERICA BRIAN MOYNIHAN: Well, I think the idea of scale being valuable in national brands, et cetera, are very important. When I started in the business as a businessperson in the early ’90s as a strategist, the world said, you know, there’s going to be some massive consolidation. It just takes time and it takes alignment of boards and strategies and things. But the idea there will always be all kinds of banks in the United States, small, medium and large.

The idea of being larger is being proven out not only by the largest but also the midsize banks who get more scale and the ability to get efficiencies and everything you had. But what’s really different from bank then is the ability to have a national brand. Only in the ’80s have you been able to have a national franchise, first started. It wasn’t national. Now you can have that. So, our ability to go into a place like Denver, which we did four or five years ago and get to number eight position very quickly with $100 million plus an average branch size is because our national brand leads us. And that’s what competitors have to think about.

WILFRED FROST: You boost your minimum wage recently. It was already due to go up from $17 to $20 by the end of 2021. You brought that forward to take place Q1 next year. Why have you brought it forward?

CEO OF BANK OF AMERICA BRIAN MOYNIHAN: Well, we have to be the best place for teammates to work. And we have to have great talent because this is a war for talent to do what we do. And we have, you know, 200,000 teammates and we make sure — want to make sure we have the best people. So, what we do is we pay competitively across the board. At the minimum level, what we want to do is really bring our teammates up to the level, a starting salary, a summer clerk, whatever, gets $40,000 plus. And a lot of people enter the company much higher than that. But everybody gets that. A full array of benefits, way above a living wage calculation, when you add the costs up and the way they’re calculated. Because we think that’s the right thing to do as an employer.

We think the challenges other people came up and matched our 17. I’m sure other people will come up. But it’s a competitive market out there. We need to continue to get the best people. We need them to see a career path. And raising the minimum wage as part of that. It’s part of being the best place for teammates to work.

WILFRED FROST: Should politicians like Senator Warren who regularly criticize people who have accumulated vast wealth or criticize executive pay, should they acknowledge the changes you’re making as well at the same time at the bottom?

CEO OF BANK OF AMERICA BRIAN MOYNIHAN: Well, people acknowledge the changes we make. The Human Capital Report — you asked me the question about $20 and competitors moving up and matching. You know, our industry is an industry which has a good profit margin and, therefore, it can pay its teammates well. And then those teammates have great lives. 600,000 people we insure through health care and stuff, those are all good things. So, my view is, the capital system is the system to help us drive the things we need in the world. We have to produce great returns for our shareholders.

And we have to do what society needs from us. And being the best place to work in these types of activities, the training, the reskilling, the hiring we do from colleges. In the ten years I’ve been CEO, we’ve hired 15,000 college kids probably. Think that the dynamism we’ve put in. So, that’s part of the ticket for being a large company. But we’ve got to do both. We’ve got to have great returns and do what society needs from us or else I won’t be CEO anymore.

WILFRED FROST: Well, on that note, you just said ten years. It’s next week, I think, the ten-year anniversary since you became CEO. Do you feel like you’ve got another full economic cycle that you want to lead the bank through the next downturn and out the other side? How do you think about that?

BRIAN MOYNIHAN: Well, I get asked the question a lot. The first thing I say is you’re trying to get rid of me. Assuming people don’t want to do that, at the end of the day, I serve at the discretion of the board. When I look at somebody like Mr. Buffett who is 88 and his intellectual drive and stuff, you know, that’s somebody I think that’s had–

WILFRED FROST: That’s 28 more years though?

CEO OF BANK OF AMERICA: Well, I’m not sure I’ve got 28 in me. But, the idea is we have a great management team. We’re working well together. We’re having some success. We’ve got a lot more opportunity ahead of us. So, my challenge is to keep the motivation up for myself and my team. That’s why we use the term nice start. It’s both congratulatory–we’ve accomplished a lot in the last decade, but it’s just a start and we’ve got a lot ahead of us. So, I’ll work as long as the board will let me.

WILFRED FROST: When you took over, the bank was $130 billion in market cap. It’s now over $300 billion. Has the easy growth happened as you get bigger? Have you passed the optimal size for Bank of America?

BRIAN MOYNIHAN: We actually are growing organically at a faster rate in terms of activity than we’ve ever grown at during this time. And that shows the power of really, frankly, having a company that had to go through so much in the early part of my tenure and early part of the decade and restructure it. Now it just sits there and says how can we be better for every customer, every client, every teammate, every shareholder, every community, every day. That’s a wonderful place to be. I’m lucky that my predecessors did all the hard work to get us a franchise like this and all I have to do, with my team and they do all the hard work, is figure out how to drive it. And it’s a powerful engine. It’s wonderful to have the honor to lead it.

WILFRED FROST: Brian, always a pleasure to catch up. Congrats on the decade next week. Thanks for joining us. Brian Moynihan, the Chairman and CEO of Bank of America. Guys, I’ll send it back to you.

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