Bank of America ( BAC) CEO Ken Lewis struck optimistic notes about his firm's profitability and the economic outlook on Thursday, and also conceded a "regret" concerning BofA's Merrill Lynch acquisition.

Lewis said in a lengthy CNBC interview that consumers are benefitting from the refinance boom amid sharply lower mortgage rates, and that there have been modest signs of improvement on delinquency rates for consumer debt like credit cards over the past two months. BofA is receiving unprecedented volume for refinance applications, which Lewis says will "put a lot of money in consumers' pockets."

While conceding that he might be "grasping at straws for good news," Lewis also predicted that in one year, unemployment will be bottoming out and the overall economy will show vast signs of improvement. He and other CEOs of major banks, like JPMorgan Chase's ( JPM) Jamie Dimon and Citigroup's ( C) Vikram Pandit, have been more vocal about their positive views to uplift market sentiment and the public mood about banks.

"One year from now we'll be coming out of this and you'll be able to see a lot of the earnings power of financial institutions," Lewis said.

However, the next six months will be a "gut-wrenching" period, Lewis added, as investors determine whether or not to jump back into the market full force. He predicted that investors will struggle to balance signs of improvement from housing, manufacturers and financial institutions as unemployment -- a lagging indicator of economic health -- continues to climb.

Lewis also sought to dispel criticism of Bank of America's hasty acquisitions of the collapsing mortgage lender Countrywide Financial and troubled investment bank Merrill Lynch. In what seems to be part of a broader strategy to integrate Merrill and shed non-essential assets, Bank of America may also be shopping around its Columbia Management asset management unit, the Wall Street Journal reported Wednesday.

Lewis said that BofA has lost some Merrill employees, saying some were top earners lured away by foreign banks, and others left because they didn't meet performance goals. Lewis also repeated earlier statements that accepting an additional $20 billion to seal the Merrill deal was a mistake.

"That was my mistake ... I regret having taken that much," said Lewis.

However, he also predicted that the two deals that have garnered the most criticism will be viewed as his best decisions once the smoke of the economic crisis clears, saying Countrywide has already reached a "sweet spot" because of the refinance boom underway.

"Countrywide and Merrill Lynch will prove to be two of the best acquisitions we've ever made if you judge us on two or three years, rather than two or three months," Lewis asserted.

Lewis also made yet another effort to separate his company from Citi, which has received the same amount of government funding, but also additional assistance from the feds as it traipsed into more dire straits. He also noted that $700 billion of BofA's $2.4 trillion loan portfolio has been "marked down pretty severely" to reflect weak economic conditions. Wells Fargo ( WFC) has received praise for using that strategy, positioning itself for a potential rebound if the economy turns around soon.

He noted that one out of two U.S. citizens has a banking relationship with BofA, and that the company was profitable last year despite loan losses. He anticipates a profit of $45 billion before taxes and margins in 2009.

On a personal note, Lewis brushed off a question about how he feels as an executive who was named the country's top banker just a year ago, but has received sharp criticism from high-profile investors and the public at large lately.

"You're just going to have ups and downs no matter what you do," he said.