Bank of America Follows Goldman Sachs and Citigroup to Phony Profit
Bank of America's Profit Mainly Due to Recent Deals By Binyamin Appelbaum Washington Post Staff Writer Tuesday, April 21, 2009 Bank of America said yesterday it earned $4.2 billion in the first quarter, the latest sign that the government is succeeding in stabilizing the banking industry. The company's profits came mostly from Merrill Lynch, the investment bank it purchased in the fall with financial aid from the federal government. Revenue from trading in financial products, including corporate debt and securities, has driven the renewed profitability of most large banks in the first quarter, even as retail banking operations continue to struggle. . . . As with other large banks, Bank of America's earnings benefited substantially from accounting rules.
The bank booked a profit of $2.2 billion on the decline in value of its own debt, which is allowed because the bank could now repurchase that debt at the lower price. Other banks, including Citigroup, also have claimed billions in profi…