BoA posts $1.9 billion loss

NEW YORK (AP) — Things keep getting worse for Bank of America.

On Tuesday, the nation’s largest bank reported a loss of $9.1billion during the second quarter, partly due to an $8.5 billion settlement with investors. That agreement, reached in June, settled claims that the bank had sold the investors poor-quality mortgage bonds. The bank had already announced several other settlements this year. The total so far to settle investor claims: $12.7 billion.

The large settlements and protracted losses related to mortgage loans is causing investors to worry about something bigger: Bank of America’s overall financial strength. In a conference call to discuss the earnings report, analysts grilled the bank’s executives.

At the top of their list of concerns? Whether the bank will need to raise more money to comply with new international requirements that large banks hold more capital. If Bank of America needed to boost its capital reserves, it might look to raise more money by issuing more common shares of its stock. That would dilute the value of stock owned by current shareholders.

The stock is already down more than 35 percent for the year and is the only large bank whose shares trade below $10 per share.