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Bank of America has over $8 billion loss for the quarter

July 20, 2011
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Source: Charlotte Observor

As expected, Bank of America Corp. this morning gave investors an historically bad quarterly earnings report.

The Charlotte-based bank said it lost $8.8 billion in the second quarter, as more than $20 billion in previously disclosed mortgage-related charges walloped its bottom line. The loss was the company’s worst ever, but in line with the estimate it gave last month of between $8.6 billion and $9.1 billion.

The Charlotte-based bank said it lost $8.8 billion in the second quarter, as more than $20 billion in previously disclosed mortgage-related charges walloped its bottom line. The loss was the company’s worst ever, but in line with the estimate it gave last month of between $8.6 billion and $9.1 billion.

The red ink demonstrated, once again, that the nation’s biggest bank is laboring to shed mortgage-related troubles inherited from its 2008 Countrywide Financial purchase. A large portion of the mortgage losses stem from an $8.5 billion settlement announced last month over investor claims related to Countrywide loans sold off during the housing boom.

On a day when investment bank Goldman Sachs reported a lower-than-expected profit, Bank of America’s shares slipped nearly 2 percent to $9.53. The shares are trading at a two-year low.

The ongoing mortgage woes have left analysts wondering if the bank has enough capital to absorb future losses and to meet stricter international standards that are being implemented through 2019. In a conference call with analysts, the bank’s executives noted that the company’s capital ratios exceeded estimates outlined last month and listed ways the bank can meet the higher requirements over time.

Read the complete story at charlotteobserver.com




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