Bank of America last week said its profit more than tripled in the first quarter on gains from trading and home refinancing, making it the latest in a string of troubled financial institutions to issue a sunny earnings report.
The Charlotte, N.C.-based banking giant said net income for the first three months of the year rose to $4.25 billion, or 44 cents per diluted share, compared with $1.2 billion, or 23 cents a share, during the same period in 2008.
The year-over-year increase in quarterly earnings per share was smaller because of preferred-share dividend payments, including $402 million to the federal government. All told, the bank said its total revenue increased 56.94 percent to $45.42 billion for the quarter boosted by income from trading at Merrill Lynch and mortgage lending at Countrywide, two much-criticized acquisitions made last year by Bank of America’s embattled CEO, Kenneth D. Lewis, amid the financial crisis.
Bank of America was the largest bank in the U.S. at the end of last year, with nearly $2.5 trillion in assets, according to a report last month by the research firm SNL Financial.
Analysts focused on concerns about continued losses from Bank of America’s consumer loans. The company’s credit card division lost $1.77 billion in the first quarter, compared with a profit of $867 million a year ago.
The addition to provisions for credit losses came at the same time that the company took a net charge-off of $6.94 billion, nearly three times the size of the 2008 first-quarter charge-off of $2.72 billion. •
