BofA records 'worrying loss'

20 July 2011

Bank of America (BofA) has reported a record quarterly loss for the second three-month period of 2011.

The lender revealed low interest rates and mortgage difficulties meant it posted a fall of $8.8 billion across the time-frame.

A considerable factor in the performance, however, can be explained by the $8.5 billion the institution revealed it would pay in an effort to settle lawsuits relating to mortgage bond investments.

Nevertheless, concerns have also arisen that a sluggish economy will do little to help the biggest bank in the US get back on its feet.

Brian Moynihan, chief executive officer at BofA - which boasts a history of more than 200 years - played down the problems by suggesting the lender was in a better position between March and June than it was in the same spell last year, adding: "We don't need to raise capital."

However, shares in the bank dipped by 1.5 per cent following the announcement.

By Tony Aynsley

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