Earnings dive for Bank of America, Wachovia

Filed under: Banking & Finance,Daily News |

The Associated Press

Hurt by the deepening credit crisis, Bank of America Corp. said Tuesday its fourth-quarter earnings fell 95 percent, and Wachovia Corp. reported its earnings tumbled 98 percent.

Net income at Bank of America, the nation’s second-largest bank, dropped to $268 million, or 5 cents per share, in the three months ending Dec. 31 from $5.26 billion, or $1.16 per share, a year ago.

The bank’s revenue fell 31 percent to $12.67 billion from $18.49 billion last year.

The quarter included results from LaSalle Bank, which Bank of America purchased Oct. 1.

Analysts expected earnings of 18 cents per share on revenue of $13.24 billion, according to a poll by Thomson Financial. The earnings estimates typically exclude one-time items.

Bank of America shares fell 57 cents, or 1.6 percent, to $35.40 in morning trading.

Rival Wachovia said its fourth-quarter profit fell to $51 million, or 3 cents per share, from $2.3 billion, or $1.20 per share, during the same period a year earlier.

Excluding merger-related expenses, Wachovia earned $160 million, or 8 cents per share, during the fourth quarter.

Wachovia, the nation’s fourth-largest bank, took a $1.7 billion write-down during the quarter due to weakening credit markets. Banks have been forced to reduce the value of bonds and debt backed by mortgages and other consumer loans that have increasingly defaulted in recent months.