""Bank of America"":https://www.bankofamerica.com/ reported a major boost in profits for the second quarter despite a drop in mortgage banking income.
[IMAGE]According to its quarterly earnings report, BofA pulled in approximately $4.0 billion in Q2, an increase of 63 percent over the $2.5 billion recorded for Q2 2012. Last quarter's results ""were driven by year-over-year improvements in net interest income, investment and brokerage income, investment banking fees, sales and trading revenue, equity investment income and credit quality as well as expense reductions,"" the bank said.
However, those gains were partially offset by the absence of year-ago gains related to liability management actions and lower mortgage banking income.
On the origination side, the Charlotte, North Carolina-based bank funded $26.8 billion in residential home loans and home equity loans, up 7 percent over the first quarter and 41 percent over the same quarter last year. First-lien mortgage production alone totaled about $25 billion, up 40 percent year-over-year.
Approximately 83 percent of funded first mortgages were refinances, while 17 percent were for home purchases, BofA said.
Despite the increase in production, BofA's Consumer Real Estate Services division reported a net loss of $937 million compared to a loss of $744 million in Q2 2012. Noninterest income was $1.4 billion, a decrease of $400 million from the prior year, ""primarily due to lower servicing income driven by a decline in the size of the servicing portfolio."" Meanwhile, core production revenue saw a decline of $42 million to an estimated $860 million as lower margins offset higher originations.
On the brighter side, BofA was able to set aside less for representations and warranties--a provision of $197 million compared to last year's $395 million.