Legal fees weigh on Bank of America. In the third quarter, the US banking giant collected net profits of 168 million dollars, a clear decrease compared to the 2,5 billion recorded in the same period last year.
When the dividends payable on the preferred stock are subtracted, the result turns into a net loss of one cent per share. Revenue fell from $21,74 billion to $21,43 billion. Net inflows, on the other hand, fell by 1%, to 21,4 billion dollars.
In reality, the institution's profits would have more than doubled if the accounts weren't affected by extraordinary charges of $5,3 billion related to subprime mortgage litigation.
In August, Bank of America negotiated with the US authorities for the payment of the highest fine in history: a total of 16,65 billion dollars, of which 9,65 billion in cash (5,02 billion for civil fines and 4,63 billion for compensatory payments) and about seven in reimbursements to customers.
A hefty bill that the institute had agreed to pay in order to no longer have to face the accusations relating to the disposal of toxic derivatives linked to mortgages, or the activity at the basis of the 2008 financial crisis.
Both earnings and revenue for the third quarter, however, were higher than expected: analysts were expecting a net loss per share of $0,09 and revenues of $21,34 billion.
Furthermore, at the end of September, Bank of America had received a $7,65 million fine from the Security and Exchange Commission (Sec, Consob American) for errors related to the calculation of assets for $4 billion that it had disclosed in April.
