Bank of America, the major American bank by the volume of assets, has reviewed its financial results for the last eight quarters because of the outcome of its daughter company which is engaged in credit card activity – FIA Card Services. As it is stated in the press-release of the bank, latest reports include the writes-off in amount of 20.3 billion dollars.
Authors of the press-release explain the losses by worsening of the credit quality in 2009 and enactment of so-called Credit Card Act in 2009 which forbad financial organizations to charge customers some additional fees.
The bank management emphasizes that the money write-off was cashless and it will not affect the company’s reports for 2009 and 2010 in the part of income, taxes or dividends. However, The Wall Street Journal notes that this amount shows how significant the credit card losses of the bank were. Earlier Bank of America supposed that FIA Card Services write-down would be smidgeon more than 10 billion dollars. According to WSJ this estimation had never been announced as the bank never included FIA in its public reports. At the same time, Bloomberg informs that card division of Bank of America sustained losses of 6.6 billion dollars in 2010 and 5.3 billion in 2009.
