Slammed by concerns about banks and credit deterioration, the financial sector nosedived during Monday’s trading session. Dow’s tape currently at red 240+ pts and below 8K levels.
Bank of America (BAC) saw its shares tumble too despite reporting Q1’09 net income of $4.2 billions which was significantly better-than-expected results and reiterating it “absolutely” doesn’t need additional capital. The co. earned 44 cents per share, on revenue of $35.76 billion. Analysts expected a profit of 4 cents per share on $27.13 billion in revenue.
“The fact that we were able to post strong, positive net income for the quarter is extremely welcome news in this environment,” said Kenneth D. Lewis, chairman and chief executive officer. “It shows the power of our diversified business model as well as the ability of our associates to execute. We are especially gratified that our new teammates at Countrywide and Merrill Lynch had outstanding performance that contributed significantly to our success.” [via BofA]
Bofa however, warned of worsening loan default problems even as it posted a Q1 profit of $2.81 billion.
“Credit is bad and we believe credit is going to get worse before it will eventually stabilize and improve,” Chief Executive Ken Lewis said during a cc with analysts, noting that the bank continues to face challenges. “Whether that turn is later this year or in the first half of 2010, I’m not going to hazard a guess.”