BofA incurs loss of US$5.2b in Q4
By Ieva M. Augstums |
January 21, 2010, Thursday
|
Print Edition
Print Edition
BANK of America Corp yesterday said it lost US$5.2 billion during the final three months of last year, as consumers struggled to make their mortgage and credit card payments and the bank repaid its government bailout money.
The bank said its loss, which reflected payment of preferred dividends, compared with a loss of US$2.4 billion a year earlier. The bank said its earnings results were boosted by strong results from its Merrill Lynch investment banking operations.
BofA, among the hardest hit financial companies during the credit crisis and recession, set aside US$10.1 billion during the fourth quarter to cover soured loans, down nearly 14 percent from the previous quarter. But the bank also reported big losses in its mortgage and credit card businesses.
The Charlotte, North Carolina-based bank lost 60 cents per share, more than the 52 cents analysts were expecting, according to Thomson Reuters.
The bank said its global wealth and investment management unit saw its net income rise to US$2.5 billion in the quarter, up from US$1.4 billion a year earlier, driven by the addition of Merrill Lynch.
The bank's results followed the pattern of JPMorgan Chase & Co and Citigroup Inc, which reported continuing losses for their lending operations during the fourth quarter. The losses are raising concerns about the impact of credit problems on the economic recovery.
JPMorgan, which reported a US$3.28 billion profit, said its investment banking earnings offset loan losses. Many analysts predict loan losses should peak some time in the first half of this year.
On Tuesday, Citigroup said it lost US$7.6 billion in the fourth quarter as consumers continued to struggle to repay loans and the bank repaid its government bailout.
BofA said US$4 billion of its loss came from the costs of paying back US$45 billion in government bailout money last month.
The bank said its loss, which reflected payment of preferred dividends, compared with a loss of US$2.4 billion a year earlier. The bank said its earnings results were boosted by strong results from its Merrill Lynch investment banking operations.
BofA, among the hardest hit financial companies during the credit crisis and recession, set aside US$10.1 billion during the fourth quarter to cover soured loans, down nearly 14 percent from the previous quarter. But the bank also reported big losses in its mortgage and credit card businesses.
The Charlotte, North Carolina-based bank lost 60 cents per share, more than the 52 cents analysts were expecting, according to Thomson Reuters.
The bank said its global wealth and investment management unit saw its net income rise to US$2.5 billion in the quarter, up from US$1.4 billion a year earlier, driven by the addition of Merrill Lynch.
The bank's results followed the pattern of JPMorgan Chase & Co and Citigroup Inc, which reported continuing losses for their lending operations during the fourth quarter. The losses are raising concerns about the impact of credit problems on the economic recovery.
JPMorgan, which reported a US$3.28 billion profit, said its investment banking earnings offset loan losses. Many analysts predict loan losses should peak some time in the first half of this year.
On Tuesday, Citigroup said it lost US$7.6 billion in the fourth quarter as consumers continued to struggle to repay loans and the bank repaid its government bailout.
BofA said US$4 billion of its loss came from the costs of paying back US$45 billion in government bailout money last month.
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