NEW YORK (
Bank of America
(BAC - Get Report)
was the loser among the largest U.S. financial names on Wednesday, with shares sliding 5% to close at $7.53.
The broad indexes saw 1% gains after the
said in its Beige Book report that U.S. economic activity "continued to expand at a modest to moderate pace in June and early July" in the majority of the central bank's 12 districts, with the Atlanta, St. Louis, and San Francisco districts reporting "modest growth," while "Boston, Chicago, Minneapolis, Kansas City, and Dallas described economic activity as advancing moderately."
The New York, Philadelphia, and Cleveland districts said economic activity was "advancing moderately," while "the New York, Philadelphia, and Cleveland Districts noted that activity continued to expand, but at a slower pace since the last report," and "Richmond cited mixed activity."
In contrast to the broad market, the
KBW Bank Index
was down 1% to close at 45.99, with all but seven of the 24 index components showing declines for the session.
Bank of America on Wednesday reported a
of $2.46 billion, or 19 cents a share, beating the consensus estimate of a 14-cent profit, among analysts polled by Thomson Reuters.
Earnings increased from $653 million, or three cents a share, during the first quarter, and a net loss of $8.8 billion, or 90 cents a share, during the second quarter of 2011, when the company entered into an $8.5 billion mortgage repurchase claim settlement with a group of private investors led by
Bank of New York Mellon
The major factor driving the shares down on Wednesday was a 41% increase in total
claims against bank of America, to $22.7 billion as of June 30 from $16.1 billion in March.
Mortgage loan repurchase claims from government-sponsored mortgage giants
made up 53% of outstanding claims against the company as of June 30, which is down from 63% the previous quarter, despite the fact that Bank of America is still in a major dispute with Fannie Mae over "what constitutes a valid repurchase request," -- according to Bank of America CFO Bruce Thompson -- and continues to refuse to repurchase loans from Fannie.