CHARLOTTE - Bloomberg
Bank of America, the biggest U.S. consumer bank and home lender, said second-quarter profit fell less than analysts estimated and that the purchase of Countrywide Financial Corp. will add to earnings this year.
Bank of America said net income declined 41 percent to $3.41 billion, or 72 cents a share, from $5.76 billion, or $1.28, a year earlier.
Four of the nation's five biggest banks have now reported better-than-estimated results, sparking a rally in financial shares that lifted Bank of America 48 percent in three days last week. Chief Executive Officer Kenneth Lewis completed the $2.5 billion purchase of Countrywide on July 1, betting that the bargain price and a rebound in home sales will make up for the current record wave of mortgage defaults.
�Countrywide will go down as a good, bold acquisition,� said Bernie McGinn of McGinn Investment Management in Alexandria, Virginia. �If you have people scared about the prospects for their community bank, and there's a Bank of America office next door, then people are going to move their money. That's not being priced in.�
Bank of America traded at $30.11 at 7:44 a.m. yesterday, before the start of official New York Stock Exchange hours. The shares closed at $27.49 last week.