BofA Sharpens the Ax

The poor earnings showing at BofA comes on the heels of a 57% drop in third-quarter net at Citigroup(C Quote) and a 2% rise in profit at JPMorgan (JPM Quote). The disparity shows that although the summer's credit crunch hit all the financial institutions, not all of them suffered equally.

Responding to questions about a super structured investment vehicle that BofA is working on creating along with JPMorgan and Citi, Lewis said that the move would not be an act of charity. The banks, at the government's behest, are working to create a big fund that would buy assets from the structured investment vehicles that are struggling to roll over the commercial paper amid the continuing credit crunch.

"We would do it at market rates," he commented."This is no giveaway -- we'll make money at it."

The so-called Master-Liquidity Enhancement Conduit is expected to help grease the wheels in an asset-backed commercial paper market that has been jammed since the summer.

BofA shares fell $1.81 to $48.22.