Banking, finance, and taxes
Bank of America Earnings Fall Short (BAC)
Published:
Bank of America (NYSE: BAC) has just posted earnings at $0.05 EPS, while First Call had estimates at $0.18 on last look. Net income was actually $268 million in the quarter even though B of A posted roughly $5.28 Billion in CDO-related writedowns. Trading account losses were $5.44 Billion, driven by CDO writedowns. Provision expenses increased $1.74 Billion, mostly due to a $1.33 Billion addition to the reserve for credit losses.
The bank notes that it is cautiously optimistic about 2008 although it notes that economic growth will be anemic at best in the first half of the year. Shares of Bank of America have hardly traded as there are roughly two and a half hours to the market open, but the initial indications are down more than 5%. With futures gapping down so much, that is probably to be expected. Until the tones can be inferred out of the conference call, this is still unfinished business.
Jon C. Ogg
January 22, 2008
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