Bank of America (BAC) lost $7.3 billion in the third quarter, or $0.77 per diluted share, after a $10.3 billion “goodwill impairment charge” as required under the Dodd-Frank Act. BofA said the writedown is related to its Global Card Services segment and results from the limits placed on debit interchange fees under the reform passed in July. Without this fee, BofA earned a net income of $3.1 billion in the third quarter, after a net loss of $1 billion in the third quarter of 2009 and a $3.1 billion gain in the second quarter of 2010. BofA reported a net loss of $344 million in its Home Loans and Insurance segment, up from a $1.6 billion loss last year and a $1.5 billion loss in the second quarter. Revenue increased in its mortgage banking department by 10%, mostly due to improvements in its mortgage servicing rights. The bank’s provision for credit losses dropped $1.6 billion in the quarter, citing improving portfolio trends. Its total amount of nonperforming loans, leases and foreclosed properties for BofA reached $34.5 billion, up 2.1% from a year ago but down 2.9% from the previous quarter. BofA extend $173 billion in credit in the third quarter, including $72 billion in first mortgages. Of that, 36% were for home purchases and 64% was for refinances. Its Tier 1 Capital Ratio increased to 15.65%, up nearly one percentage point from the previous quarter but down from 16.69% a year ago. Its Tier 1 Common Ratio increased to 8.45% from 8% in the second quarter and 7.25% a year ago. Write to Jon Prior.
Bank of America loses $7.3 billion in 3Q
Most Popular Articles
Latest Articles
Did lower mortgage rates slow housing inventory growth?
After two weeks of significant increases, my model for inventory growth with higher mortgage rates came crashing down last week.
-
Labor market report is good news for mortgage rates
-
Virginia Realtors: Zillow’s touring agreement may not be legal
-
Low inventory creates challenging conditions in North Carolina’s housing market
-
Tri-state area housing shortage could cost the region economically
-
Remote reverse mortgage counseling now permanently permitted in Massachusetts