Bank of America Earnings Off Nearly 80 Percent

April 21, 2008 No Comments »

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Bank of America today reported first quarter net income of $1.21 billion, or 23 cents per share, compared to earnings of $5.26 billion, or $1.16 per share, in the same period a year ago as housing woes continued to rattle the banking giant.

Provisions for loan losses at the bank and mortgage lender increased to $6.01 billion from $3.31 billion in the fourth quarter and $1.24 billion a year ago, largely related to problems in its home equity loan, small business and home-builder portfolios.

Net charge-offs were $2.72 billion, or 1.25 percent of total average loans and leases, up from $1.99 billion, or 0.91 percent in the fourth quarter.

Nonperforming assets increased to $7.83 billion, or 0.90 percent of total loans, leases, and foreclosed properties, up from $2.06 billion, or 0.29 percent, a year earlier.

On a positive note, the company’s direct-to-consumer mortgage originations increased 32 percent in the quarter to the highest level since 2003 thanks to a period of favorable mortgage rates (and higher refinance apps), though they did halt wholesale lending at the end of the year.

Shares of Bank of America were off 91 cents, or 2.36%, to $37.65 in afternoon trading on Wall Street.

(photo: mwichary)

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