Bank Of America Says 2nd Half Profitability Tougher Than 1st

Discussion in 'Wall St. News' started by ASusilovic, Jul 17, 2009.

  1. NEW YORK -- Bank of America Chief Executive Ken Lewis said on Friday that profitability in the second half of the year will be much harder to achieve than it was in the first, and that the company is unlikely to report normalized earnings for several quarters. "Profitability in the second half of the year will be much tougher than the first half, given the absence of several one-time items that were positive to earnings. I think we have to get through the next couple of quarters and into 2010 before it becomes apparent that the market strength of our various businesses will help us return to more normalized earnings," Lewis told listeners on a conference call to discuss the firm's second quarter financial results.
  2. Set the "bar" as low as possible. :cool:
  3. Indeed. I am absolutely baffled at how earnings are so much higher than expectations.
  4. `

    smoke and mirrors.
    loan mods - ie extending mortgages to 150% of the worth of the house to prolong foreclosure are theoretically actually worth more as their potential revenue stream to the bank becomes greater. a write up of sorts... whats missing from the picture is modelling to account for how many of the modified loans will turn sour. Another pozi scheme to bump earnings to encourage investment and return to normality. this will work its way out like a basketball through a snake - it will end in pain...

    plus there are less lenders in the business which increases market share.

    i dont really get it either though - how could they be so broke 6 months ago and so profitable today...
  5. The home loan and insurance unit lost $725 million, even as revenue tripled, on credit costs and expenses to help homeowners modify their loans. The bank sees signs that some loan losses may abate, with late payments flattening and home prices stabilizing in California’s hardest hit markets, Lewis said. Card services swung to a loss, and the new federal law curbing interest rates and fees may slice revenue, the bank said.


    Bank of America suffered rising defaults on real-estate loans tied to retail and office properties, while the level of troubled loans to home builders and developers stabilized, Chief Financial Officer Joe Price said.
  6. Short this stuff at 17.45.
  7. Sounds like it's time for another infusion (transfusion?) of capital from thin (and getting thinner) air.
  8. jheacock


    Yes, it's much harder to become profitable when you actually have to earn it compared to having the government (taxpayers) bail you out when you make bad investments or can't rig the system in your favor.