Bank of America reported profit dropped 63% as costs mounted from faulty foreclosures and flawed home loans made as long as a decade ago.
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 $60bn of assets in the process. The bank announced an $11.7bn deal to end disputes with Fannie Mae on bad home loans this month and joined an $8.5bn 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 $100bn, 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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image: © Alex E. Proimos