Bank of America has reported a net profit of $168 million in Q3 2014, down from $2.5 billion a year earlier.
Total revenue was $21.4 billion.
The huge drop in profits was due to a previously announced $5.3 billion mortgage-related settlement with the Department of Justice and other federal agencies.
Most areas of the business improved profitability compared with a year ago.
Bank of America has reported a net profit of $168 million in Q3 2014, down from $2.5 billion a year earlier
“We saw solid customer and client activity and improved profitability in most of our businesses relative to the year-ago quarter,” said Bank of America’s chief executive Brian Moynihan.
The bank’s property business posted a loss of $5.2 billion, compared with a loss of $990 million a year earlier.
Profits at the asset management arm rose slightly to $813 million, while those at the global banking division rose by a quarter to $1.4 billion.
The global markets business turned a loss of $875 million to a profit of $769 million.
On October 14, rival JP Morgan reported a profit of $5.6 billion for Q3 2014, while Citigroup posted a $3.4 billion profit.
[youtube J27y8k7rId4 650]
Portuguese bank Banco Espirito Santo (BES) has reported a bigger-than-expected loss of 3.6 billion euros ($4.8 billion) for the first six months of 2014.
The troubled bank said “extraordinary events” had resulted in costs totaling 4.25 billion euros during the period.
The loss wipes out BES’s existing capital buffer of nearly 2.1 billion euros – cutting it to below the minimum level required by regulators.
The lender said it will begin a process to raise cash to meet capital rules.
“Over the course of the past few weeks, both shareholders and potential investors have shown interest in participating in a capitalization plan, some of them willing to take relevant stakes in the bank,” Chief Executive Vitor Bento said in a statement.
Banco Espirito Santo has reported a bigger-than-expected loss of $4.8 billion for the first six months of 2014
The larger-than-expected loss comes as BES – Portugal’s largest private bank – has been under increased scrutiny.
There have been concerns over the financial strength of the bank’s parent company and its ability to deal with its debt problems.
The fears were fanned after parent companies linked to the Espirito Santo family sought protection from creditors.
That has hurt the bank’s share price, which has slumped almost 40% in July.
The worries had also prompted the governor of Portugal’s central bank to issue a statement earlier this month aimed at reassuring depositors and investors about the health of BES.
The central bank had said at the time that investors had “no reason to doubt” the security of funds, and savers had “no need to be worried”.
The lender has also been trying to restructure its senior management.
Earlier this month, it accelerated the appointment of new executives, originally due to start at the end of July.
The Bank of Portugal ordered the changes to be fast-tracked after worries about the financial strength of the bank’s parent company hit global stock markets.
Speculation surrounding accounting regularities at the parent company of BES, Espirito Financial Group, led to three family members being replaced.
Espirito Santo Financial Group, which holds a 25% stake in BES, previously said economist Vitor Bento would be the new chief executive of the bank from the end of July and Joao Moreira Rato, who heads Portugal’s IGCP debt agency, would become the chief financial officer.
Meanwhile, Jose Honorio becomes deputy chief executive officer.
The three replace the Espirito Santo family members, including its patriarch Ricardo Espirito Santo Salgado, who announced his resignation as chief executive of BES last month.
Santo Salgado, who ran the bank for 23 years, was arrested last week in connection with a money laundering and tax evasion investigation.
[youtube jUOgXp3f4ss 650]
