“Bank of America Corp. reported profit dropped 63 percent as costs mounted from faulty foreclosures and flawed home loans made as long as a decade ago.
Net income dropped in the fourth quarter to $732 million, or 3 cents a diluted share, from $1.99 billion, or 15 cents, a year earlier, according to a statement today from the Charlotte, North Carolina-based company. Adjusted for one-time items, profit was 29 cents a share, beating the 20-cent estimate of 18 analysts surveyed by Bloomberg. Revenue dropped 25 percent.
Chief Executive Officer Brian T. Moynihan has spent his first three years cleaning up after his predecessor’s takeover of Countrywide Financial Corp. and Merrill Lynch & Co., selling more than $60 billion of assets in the process. The bank announced an $11.7 billion deal to end disputes with Fannie Mae on bad home loans this month and joined an $8.5 billion industry accord to compensate for abusive foreclosures.
Last year “was about resolving as many issues as they could,” said Marty Mosby, an analyst at Guggenheim Securities LLC, which manages more than $100 billion, including Bank of America stock. “While they’ve had to absorb some losses, they were less than the worst case, and that signifies progress….”
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