Bank of America, the nation’s largest bank, reported that first-quarter earnings dropped 37 percent to $2 billion, reflecting the persistent burden of Countrywide Financial, the subprime mortgage lender it bought in 2008.
The different results between the two financial giants underscore the continued challenges that Bank of America’s chief executive, Brian T. Moynihan, faces as he tries to rebuild a company weighed down by a troubled mortgage business in an uncertain economy.
“Other than the mortgage issue, Bank of America is having the same kind of recovery everybody else is,” said Chris Kotowski, an analyst at Oppenheimer & Company.
In many ways, Bank of America and JPMorgan followed similar paths in the first quarter. Credit quality markedly improved, allowing the banks to release billions of dollars of reserves previously set aside to cover losses. Commercial lending is on the mend, and investment banking fees are rising.
view full article: Mortgage Woes Stall Bank of America’s Revival
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