BofA sees its biggest loss in lender's history

NEW YORK: Bank of America posted the biggest quarterly loss in the lender's history after chief executive Brian T Moynihan booked more costs tied to defective mortgages and revenue continued to slide.

The Q2 loss of $8.83 billion, or 90 cents a share, compared with a profit of $3.12 billion, or 27 cents, a year earlier, the lender said on Tuesday. Ed Najarian, head of bank research at International Strategy & Investment Group, called revenue "fundamentally" weak and Paul Miller at FBR Capital Markets said doubts about earnings power may prompt analysts to lower their ratings.

Moynihan, 51, is working to move Bank of America past the fallout from lax home lending by reaching settlements with mortgage bond investors and insurers and setting aside funds for future claims.

The largest US lender by assets, said it's able to get funds at attractive rates and Moynihan rejected suggestions from analysts during a conference call that the company may need to raise capital.

BofA dropped 11 cents, or 1.1%, to $9.61 as of 10:22 am in NYSE composite trading. Shares have dropped 28% this year, the worst showing in the 24-company KBW Bank Index. Revenue plunged by more than half to $13.5 billion because of previously disclosed mortgage costs. Excluding that, revenue slid 10% from the year-ago period and 2.2% from Q1.