nytimes.com/ Bank of America’s Profit Falls 11%

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SHAFAQNA (International Shia News Association)- Bank of America is the latest large bank to report uninspired earnings for the fourth quarter of 2014.

The bank said on Thursday that fourth-quarter earnings fell 11 percent, to $3.05 billion, or 25 cents a share, from $3.44 billion, or 29 cents a share, in the period a year earlier.

Analysts polled by Thomson Reuters had forecast earnings of 31 cents a share in the latest quarter. The most recent earnings were weighed down by arcane financial adjustments that the analysts might not have fully factored into their estimates. Those adjustments lowered earnings by 7 cents a share, Bank of America said.

Still, the lower earnings reflected a weaker performance in some core businesses like trading and mortgage banking. Bank of America, like other large lenders, is contending with a sluggish global economy, an uneven recovery in housing and recent weakness in the energy sector, which has been a strong source of banking revenue in recent years.

Brian T. Moynihan, the bank’s chief executive, nevertheless sought to sound an optimistic note. “There’s more work and tremendous opportunity ahead as we improve on the platform we’ve built to serve our customers and clients,” he said in a statement, “and we enter 2015 in good shape to manage both the opportunities and the challenges the markets and economy will offer.”

In the fourth quarter, Bank of America posted tax-equivalent revenue of $19 billion, a 12 percent decline from $21.7 billion in the period a year earlier. Analysts surveyed by Thomson Reuters had expected $20.9 billion.

Bank of America, the second largest bank in the country by assets, makes loans to consumers and companies, and it has a large presence on Wall Street. The housing crash burdened the bank with huge losses on mortgages and large legal payouts for several years after the financial crisis of 2008. While those problems appear to have abated – there were, for instance, no large legal charges in the fourth quarter – the challenge now for the bank is to post stronger earnings that impress investors.

For all of 2014, Bank of America reported $4.8 billion in net income, a drop of nearly 60 percent from $11.4 billion in 2013. Part of the decline in 2014 was the result of paying out large sums to settle mortgage-related legal cases.

“In 2014, we continued to invest in our businesses while reducing expenses and resolving our most significant litigation matters,” Mr. Moynihan said.

en.shafaqna.com

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