$194m fourth-quarter loss ‘disappointing’ for BofA

Bank of America has reported a loss of $194m in the fourth quarter of 2009. Morgan Stanley and Wells Fargo both had profits in the fourth quarter of 2009 whilst the Bank of America reported it’s loss. The new chief executive Brian Moyniham said the loss was “disappointing”. Compared to a year ago this is an improvement as it made a loss of $1.8bn.

The fact that they need to repay the US government’s $45bn preferred stock just makes it worse. B. Moynihan also stated that he is encouraged by signs the economy is improving, and that they have seen a stabilisation of their credit costs.

As BofA is in this position, Morgan Stanley reported fourth-quarter net income of $413m and Wells Fargo reported a profit in the fourth-quarter from growth in its mortgage banking business. They must be going wrong somewhere They are the largest US lender at the moment but will they hold this position if they continue to lose money?

The majority of these losses were from credit although this has shown improvement and was better than the third quarter. The hit was softened by their non-interest income and its investment in BlackRock. Also BlackRock buying

Barclays’ asset management business helped make this a ‘disappointment’ rather than a full blown problem. BofA may be able to stay the leading US lender or will it continue to have problems as it tries to recover from a year of big losses?

What do you think of BofA’s performance? Do you think they can pull themselves out of this hole? If $45bn cannot do it what can?