Bank of America Makes Huge Loss In 1st quarter 2014


Bank of AmericaResults Include Litigation Expense of $6.0 Billion (Pretax) or Approximately $0.40 per Share (After Tax)

Previously Announced Capital Actions Include Common Stock Dividend Increase to $0.05 Per Share in Q2-14 and a New $4 Billion Common Stock Repurchase Program

Continued Business Momentum

  • Total Period-end Deposit Balances up $38 Billion From Q1-13 to a Record $1.13 Trillion
  • Funding of $10.8 Billion in Residential Home Loans and Home Equity Loans in Q1-14 Helped More Than 36,000 Homeowners Purchase a Home or Refinance a Mortgage
  • More Than 1 Million New Credit Cards Issued in Q1-14
  • Global Wealth and Investment Management Reports Record Asset Management Fees of $1.9 Billion; Pretax Margin of 25.6 Percent
  • Global Banking Average Loan Balances up 11 Percent From Q1-13 to $271 Billion
  • Bank of America Merrill Lynch Maintained a Leadership Position in Investment Banking with Total Firmwide Fees of $1.5 Billion in Q1-14
  • Noninterest Expense, Excluding Litigation, Down 6 Percent From Q1-13
  • Credit Quality Continued to Improve With Net Charge-offs Down 45 Percent From Q1-13

Capital and Liquidity Remain Strong

  • Estimated Common Equity Tier 1 Ratio Under Basel 3 (Standardized Approach, Fully Phased-in) Increased to 9.3 Percent in Q1-14; Advanced Approaches Remains Strong at 9.9 Percent(D)
  • Estimated Supplementary Leverage Ratios Above Required Minimums(E)
  • Long-term Debt Down $25 Billion From Year-ago Quarter, Driven by Maturities and Liability Management Actions
  • Record Global Excess Liquidity Sources of $427 Billion, up $55 Billion From Q1-13; Time-to-required Funding at 35 Months

(BUSINESS WIRE)– Bank of America Corporation today reported a net loss of $276 million, or $0.05 per diluted share, for the first quarter of 2014, compared to net income of $1.5 billion, or $0.10 per diluted share, in the year-ago period.

Revenue, net of interest expense, on an FTE basis(A) declined 3 percent from the first quarter of 2013 to $22.8 billion. Excluding the impact of net debit valuation adjustments (DVA) in both periods, revenue was down 4 percent from the year-ago quarter to $22.7 billion(B).

The results for the first quarter of 2014 include $6.0 billion in litigation expense related to the previously announced settlement with the Federal Housing Finance Agency (FHFA), and additional reserves primarily for previously disclosed legacy mortgage-related matters.

“The cost of resolving more of our mortgage issues hurt our earnings this quarter,? said Chief Executive Officer Brian Moynihan. ?But the earnings power of our business and customer strategy generated solid results and we continued to return excess capital to our shareholders.”

“During the quarter, our Basel 3 standardized capital ratios and our liquidity improved to record levels and credit quality also improved,” said Chief Financial Officer Bruce Thompson. “In addition, expenses in our legacy mortgage servicing business, excluding litigation, declined by $1 billion from the year-ago quarter.”

To view the full report and tables please click here.

Source [ME NewsWire]

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