Bank of America Corp., the biggest U.S. lender, posted its second quarterly loss in less than a year, unable to shake off effects of the economic contraction that drove the company to take two taxpayer bailouts. So, let's see. Two bailouts and the lowest charges on Fed Funds ever and they lost how much?
I thought the recession was over. Didn't Bernanke tell us that?
""Obviously, credit costs remain high, and that is our major financial challenge going forward," Bank of America CEO Ken Lewis said in a statement. Say what? Banks are borrowing for next to nothing, nada, zero interest rates. Maybe that's why Ken Lewis resigned. And some are even feeling sorry for hum because he's taking no salary for this year. Yep, Ken is not taking his $1.5 million dollar CEO salary.
Don't feel too sorry for him because as it goes with politics and the powers that be, Ken gets his TENS OF MILLIONS in retirement package. That should help him recover from the loss of his salary that's less than 5% of his retirement package deal. Who said there were no more free lunches or golden parachutes?
Guess again! :-)
The $1 billion third-quarter loss, or 26 cents per diluted share, compared with a profit of $1.18 billion, or 15 cents, a year earlier, the Charlotte, North Carolina-based bank said today in a statement. The loss was more than analysts estimated and the only one posted by the nation’s three biggest lenders. Bank of America dropped 5.4 percent in early New York trading.
Blame the losses on dead beat consumers who have defaulted on their obligations.
Revenue from credit cards, brokerage services, investment banking and mortgage banking slid from the previous quarter, and Bank of America’s non-interest income dropped by 31 percent to $14.6 billion. Those declines offset a 57 percent gain in trading account profits.
Bank of America said net write-offs of uncollectible loans rose 11 percent from the second quarter to $9.62 billion. The bank wrote off $3.2 billion of home loans, including home equity loans, during the quarter, up 10 percent from the second quarter. Charge-offs on credit cards increased 5 percent to $2.17 billion.
As a spiritual-futurist, I have a BA degree majoring in history. One cannot know the future without knowing the past which holds clues to what is on the horizon. The world is in such a rapid expansion of knowledge that we are close to entering a tipping point that will forever change earth as we know it.