Bank of America’s shrinking pool of bad loans
Bank of America is shaking off the financial crisis, Reuters reports this morning. After some $45 billion in writedowns related to its purchase of Countrywide in 2008, the bank’s mortgage losses are down 75% from a year earlier:
Here’s more from Reuters:
On Wednesday, the bank said losses in its mortgage unit fell to $1.1 billion in the fourth quarter from $3.7 billion in the same period in 2012. In the year-earlier quarter, the bank reached several settlements totaling more than $5 billion with the federal government and mortgage giant Fannie Mae over foreclosures and bad loans.
Many expenses from the financial crisis are falling, but the bank’s revenues are also rising, and increased 14 percent to $22.32 billion in the quarter, excluding an accounting adjustment. Boosting revenue has been one of Chief Executive Officer Brian Moynihan’s top priorities for the last year.
The improvement was evident in several Bank of America businesses. In wealth management, clients moved money into their accounts and borrowed more, helping to lift revenue by 7 percent and profit by 35 percent. In consumer banking, fee and interest income rose, lifting revenue by 1.3 percent.
Here’s more on the bank’s quarter from CNBC’s Carl Quintanilla:
— Carl Quintanilla (@carlquintanilla) January 15, 2014
And the WSJ’s Nick Timiraos:
BofA new mortgage lending (purchases not refis) up 38% YoY in Q4 to $3.7B. JPM up 6% to $13B. WFC down 22% to $34B.
— Nick Timiraos (@NickTimiraos) January 15, 2014