Bank of America profit nearly halves after it sets aside $4.8bn to cover bad loans
Bank of America said today its profit for the first quarter was down 45 per cent on the same period last year as it set aside billions to cover expected loan defaults.
The lender said its earnings for the three months to 31 March were $4bn (£3.2bn), compared to $7.3bn for the same period in 2019.
Bank of America made a $4.8bn provision for credit losses, including a $3.6bn reserved build.
Revenue, net of interest expense, decreased one per cent to $22.8bn.
Chairman and chief executive Brian Moynihan said: “Despite increasing our loan loss reserves, we earned $4bn this quarter, maintained a significant buffer against our most stringent capital requirement, and ended the quarter with more liquidity than when we began.”
Yesterday, JP Morgan said it had made provisions of $6.8bn to cover for expected bad loans triggered by the coronavirus crisis.