Bank of America Sees Card Income Drop in Half

Bank of America (NYSE: BAC) today reported second quarter net income of $5.76 billion, up from $5.48 billion in the second quarter of 2006. Revenues rose 8 percent to $19.9 billion from $18.5 billion a year ago.

Net charge offs totaled $1.5 billion, or 0.81 percent of total average loans, compared with the year ago quarter of net charge offs of $1.0 billion, and 0.66 percent of total average loans. The provision for credit losses was raised to $1.8 billion from $1.2 billion a year ago.

The bank’s consumer-targeting division – Global Consumer and Small Business Banking – saw its net income drop from $3.2 billion to $2.5 billion, despite a small rise in net revenue to $11.9 billion.  

The card services group reported total revenue of $6.4 billion, up from $6.3 billion a year ago. Net income dropped to $961 million, down from $1.7 billion a year ago. The bank reported worldwide managed credit card net losses of $2.1 billion, or 5.02 percent of average managed card receivables, compared with $1.5 billion and 3.67 percent a year ago.