Bank of America Makes 6.2 Billion Tax Free Dollars in Third Quarter Profits
Bank of America reported $6.2 billion in third quarter gains this year, nearly recouping a $7.3 billion loss from the same time last year. Bank of America ceded its ranking as the largest bank to J.P. Morgan & Co after CEO Brian Moynihan began a campaign of mass asset sales in an effort to boost the bank’s capital. Moynihan has suggested that new regulations mean the bank will have to start charging fees for services that have traditionally been free, such as debit cards and checking accounts. Wells Fargo, Citibank, and other major banks have also recently begun announcing similar plans for an increase in service and account fees.
Total employment at Bank of America rose to 288,739 in September, but 2,000 employees have received notice that they will be let go, and in August the bank announced that it was planning to lay off 3,500 in the near future. Revenue rose 6% since last year to $28.7 billion. The bank has been heavily criticized by grassroots communities such as US Uncut for spending millions of dollars to lobby for tax cuts and loopholes. Bank of America did not pay any corporate income taxes at all in 2009 and 2010.
President Obama spoke on the issue during an interview with George Stephanopoulos on ABC/Yahoo! (see the complete transcript here), critizing the idea that banks “have some inherent right just to, you know, get a certain amount of profit” even when it means their “customers are being mistreated.” He also expressed the belief that they should be able to make a profit “the old-fashioned way, by earning it.”
Customers have been roiled by new and incoming fee requirements for basic banking services and in some cases have started migrating to banks that are not implementing them, or to credit unions which are not for-profit organizations.