The second quarter of Bank of America was bad, recording a drop in turnover of 4%, profits of 43% and shares of 13 cents. The damages are attributable to the legal costs that the second largest bank in America had to incur to resolve the allegations regarding the alleged violations of securities backed by residential mortgages. In fact, turnover fell to 21,96 billion dollars, which if on the one hand differs positively from the expectations of analysts who gave it 21,62 billion, on the other it is down compared to the turnover recorded in the same period of 2013 – 22,949 billion.
The drop in profits, which fell to 2,291 billion compared to 4,012 in the second quarter of 2013, was also caused by the more than halved mortgage disbursement activity, a -59% compared to last year. A decrease certainly caused by the agreement for 650 million with American International Group regarding the violations in the granting of mortgages, which occurred at the dawn of the crisis through the takeover of Countrywide Financial and Merrill Lynch. The counterpart offered by AIG will be Bank of America's acceptance of an $8,5 billion settlement with private investors.
As regards the positive aspects of Bank of America's quarterly report, it should be noted that there was a 5% increase in revenues generated by trading activities in fixed income, commodities and currencies, a figure which, among other things, goes against the trend reported by rivals in recent days. In general, however, trading activities recorded a drop of 14% mainly due to mortgage banking, which recorded losses of 2,8 billion dollars, an improvement compared to the 5 billion hole last quarter, but still worse than the losses recorded in the same period of the current year.
