Thursday, October 21, 2010

Bank of America Reports Colossal $7.3 Billion Quarterly Loss (Financial Performance Charts & Review) *$10.4B impairment charge* BAC

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Bank of America reported earnings October 19

Bank of America Reports Colossal $7.3 Billion Quarterly Loss

Financial charts of Bank of America data and the related commentary have been updated on the Bank of America Financial Performance page for the September Q3 2010 financial results reported Tuesday by Bank of America. The charts are:

Bank of America Performance by the Quarters
Earnings per Share
Net Revenues, Operating Income, and Net Income
Operating Margin and Net Margin
Capital to Assets and Tier 1 Capital Ratios
Return on Assets
Income Statement Components
Asset Mix

Income Statement Q3 Bank of America reported net revenues of $26.7B, net loss of ($7.3B), and a loss per share of ($0.77). From the prior quarter Q2 2010, net revenues were down -8.4%, net income down -333.8%, and loss per share down -385.2%. From the prior year Q3 2009, net revenues were up +2.6%, net loss increased +629.2%, and loss per share increased +71.9%, respectively. The operating and net margins plunged with the huge loss QoQ and YoY. The incredible net loss was due to a goodwill impairment charge of $10.4B in the global card services segment, which was related to limits to be placed on debit interchange fees under the financial reform legislation enacted in July 2010, which will reduce future revenues in the global card services business. On a positive note, Provision for Credit Losses of $5.4B is the lowest since June 2008 of $5.8B.

Balance Sheet Q3 Total assets decreased QoQ -1.5% to $2.33 trillion. The capital to assets ratio (total stockholders' equity divided by total assets) increased to 9.90%, which is adequate. Tier 1 capital was 11.2%, which is adequate and the highest since September 2009. Loans decreased QoQ -2.3%, for the 2nd consecutive quarter. The ALL/Loans ratio (Allowance for Loan Losses divided by Gross Loans) was 4.7%, should be adequate, and continues above 4% for the 4th consecutive quarter.Related Articles and Links

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