Bank of America Corporation has reported first-quarter 2010 net income of $3.2 billion compared with a net loss of $194 million in the fourth quarter and net income of $4.2 billion a year earlier. After preferred dividends, the company earned $0.28 per diluted share in the first quarter, up from a loss of $0.60 per share in the fourth quarter and earnings of $0.44 per share in the first quarter of 2009.
Two factors primarily drove results in the first quarter:
►Provision for credit losses fell by $3.6 billion from the year-ago period, reflecting an improvement in credit quality.
►Strong capital markets activity, including record sales and trading driven by industry-leading corporate and investment banking positions, helped drive results for Global Banking and Markets.
"With each day that passes, the 2010 story appears to be one of continuing credit recovery, and our results reflect a gradually improving economy," said Chief Executive Officer and President Brian T. Moynihan. "Our customers - individuals, companies, and institutional investors--increasingly see the value of our integrated capabilities. We also are seeing ample indications that those integrated capabilities hold promise for long-term shareholder value."
Consumer referrals and sales to Merrill Lynch Global Wealth Management clients accelerated in the first quarter. Approximately 60,000 lending and deposit products were sold to Merrill Lynch clients. Referrals between Global Wealth and Investment Management and the company's commercial and corporate businesses increased 56 percent compared with the fourth quarter of 2009.
During the quarter, Bank of America extended $150 billion in credit, according to preliminary data. Credit extensions included $70 billion in first mortgages, $56 billion in commercial non-real estate, $10 billion in commercial real estate, $3 billion in domestic consumer and small business card, $2 billion in home equity products and $9 billion in other consumer credit. Commercial credit extensions include a significant number of credit renewals.
Bank of America funded $69.5 billion in first mortgages, helping more than 320,000 people either purchase homes or refinance existing mortgages. This funding included $17.4 billion in mortgages made to nearly 115,000 low- and moderate-income borrowers. Approximately 37 percent of first mortgages were for home purchases.
Bank of America introduced several initiatives during the quarter to help customers. The company will eliminate debit point-of-sale transactions that would result in an overdraft if a customer does not have enough funds in their account.
The company introduced an earned principal forgiveness approach to modifying certain types of mortgages that are severely underwater to expand the company's existing aggressive homeowner retention programs.
Bank of America was the first to extend credit card assistance programs to small businesses.
Since the start of 2008, Bank of America and previously Countrywide have provided home ownership retention opportunities to customers for approximately 819,000 home loan modification transactions. This includes 569,000 loan modifications and approximately 251,000 consumers who were in trial-period modifications under the government's Making Home Affordable program at March 31, 2010. During the quarter, 77,000 loan modifications were completed with total unpaid principal balances of $17.8 billion, including 33,000 customers who converted from trial-period to permanent modifications under the government's Making Home Affordable program.
Bank of America Home Loans expanded its default management staff by nearly seven percent to more than 16,000 during the quarter to help customers experiencing difficulty with their home loans. Bank of America issued clarity statements on a number of consumer products to help customers better understand the products they use. The company has helped more than 200,000 Global Card Services account holders by reducing their interest rates and providing more affordable payment terms during the quarter.
"We will continue to support our customers through these and other initiatives aimed at helping restore their financial health," Moynihan said. "We want to ensure quality relationships with our customers and earn their trust and future business. This will benefit not just our customers, but our company and our shareholders."
For more information, visit www.bankofamerica.com.
