Bank of America loses $1B in third quarter

The country's largest bank in terms of deposits posted a $1 billion loss in the third quarter.

Charlotte, N.C.-based Bank of America's billion-dollar loss amounts to 26 cents per diluted share, compared to a gain of $1.2 billion or 15 cents per diluted share in third-quarter 2008.

The company's earnings report, released Oct. 16, cited continued weakness in the U.S. and global economies as the culprits for the loss, along with $1.2 billion in preferred dividends - including $893 million in dividends paid to the U.S. government.

Retail deposits for the quarter increased $93 billion, or 16 percent, from a year earlier. That increase includes the net impact of $72.1 billion in balances from the acquisitions of Merrill Lynch and Countrywide.

"Our revenue continued to hold up well," President and CEO Kenneth Lewis said in the release. "Obviously, credit costs remain high, and that is our major financial challenge going forward. However, we are heartened by early positive signs, such as the leveling of delinquencies among our credit card customers."

The bank extended $183.7 billion in credit during the quarter, including funding for $95.7 billion in first mortgages and commercial renewals of $50.9 billion.

Shares of Bank of America (NYSE: BAC) closed Oct. 16 at $17.26 and closed Oct. 21 at $16.51, compared to a 52-week range of $2.53 to $24.62.