Thanks to Countrywide, BoA Losses Climb

Credit quality -- including mortgages -- continued to deteriorate at Bank of America, contributing to its fourth quarter net loss of $1.79 billion. The nation's largest bank released earnings Friday morning, a day after the Treasury Department agreed to invest another $20 billion of taxpayer money into it. The government also will backstop as much as $118 billion in potential losses on various assets, primarily those brought by Merrill Lynch. The 4Q loss includes Countrywide's operations, but not Merrill Lynch's. Preliminary figures show that Merrill Lynch -- a large issuer of subprime ABS and CDOs -- lost $15.31 billion for the fourth quarter. At year end BoA had $18.23 billion in non-performing assets, compared to $5.95 billion a year earlier. The company increased its loan loss provision to $8.54 billion. During 2008, BoA and Countrywide modified approximately 230,000 home loans. In the fourth quarter, BoA extended $115 billion in new credit: $45 billion in mortgages, $7 billion of commercial real estate, and roughly $5 billion in home equity products. For the full year, BoA earned $4.01 billion.