Big banks have had their share of misery in the Great Recession that can’t end soon enough. You know the story—mortgages gone wild, multiplying foreclosures, company failures, government-forced action, CEO depar TOM
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tures, tighter regulation, and a much different, financially scarred world in which to operate. But the other side of community banking was on full display Oct. 22 on the 18th floor of the Bank of America Center in downtown Richmond. It’s the angle where investments in organizations and people make a big difference.

Bank of America Corp. lost more than $2.2 billion in the third quarter as loan losses kept rising, providing more evidence that consumers are still struggling to pay their bills. The nation’s second-largest bank said it wrote down loans on its books by almost $10 billion during the July-September period, up almost $1 billion from the second quarter.

Bank of America Corp. said Friday it lost more than $2 billion in the third quarter as loan losses kept rising, providing further evidence that consumers are still struggling to pay their bills.

If the nation’s major banks report big third-quarter profits this week, don’t take the numbers at face value. Although trading gains could drive strong earnings for banks such as JPMorgan Chase & Co. and Goldman Sachs Group Inc., mounting loan losses and the prospect of tougher capital requirements and higher deposit-insurance fees are expected to eat into the banks’ profits well into 2010 and beyond.

The New York Attorney General’s office subpoenaed five members of Bank of America Corp.‘s board Wednesday as part of an investigation into its acquisition of troubled investment bank Merrill Lynch & Co., according to a person familiar with the investigation.

A judge ordered federal regulators yesterday to explain why they didn’t investigate whether executives at Bank of America Corp. misled shareholders about bonuses paid by Merrill Lynch. U.S. District Judge Jed Rakoff in Manhattan has delayed approving the bank’s proposed $33 million settlement with the Securities and Exchange Commission over the bonus affair, which arose after Bank of America agreed to buy Merrill for $50 billion in a hastily arranged deal last September.

Lenders such as Bank of America Corp. and Wells Fargo and Co. are among those that have lagged behind government expectations in helping struggling homeowners with mortgages. The government’s $50 billion program to ease the mortgage crisis is helping only 9 percent of eligible borrowers who have seen their mortgage payments reduced with modified loans.

Bank of America has agreed to pay a $33 million penalty to settle government charges that it misled investors about Merrill Lynch’s plans to pay bonuses to its employees.

Citigroup Inc., one of the biggest recipients of government bailout money, gave employees $5.33 billion in bonuses for 2008, New York’s attorney general said yesterday in a report detailing the payouts by nine big banks. The report from Attorney General Andrew Cuomo’s office focused on 2008 bonuses paid to the initial nine banks that received loans under the government’s Troubled Asset Relief Program last fall. Cuomo has joined other government officials in criticizing the banks for paying out big bonuses while accepting taxpayer money.

General Electric Co.‘s second-quarter profit was sliced nearly in half, the company said yesterday, as the recession drove down earnings at its finance unit and smothered demand for its wide-ranging industrial goods. Although earnings beat Wall Street forecasts by a penny, GE’s revenue fell $3 billion short of expectations, helping push down shares 6 percent. Quarterly sales fell across its divisions, from health care to broadcasting, suggesting that the recession is still sapping demand for goods and services.

Citigroup Global Markets Inc. and Banc of America Securities will pay nearly $1.3 million to Virginia to settle allegations that investors here were misled about the safety of auction-rate securities. The securities were marketed and sold by brokerages to investors as safe, liquid and cashlike investments. However, they actually were long-term investments subject to a complex auction process that failed in February 2008.

It could be time to kiss fixed-rate credit cards goodbye. Two of the biggest credit-card issuers in the nation—Bank of America and Chase—say they’re switching some fixed-rate cards to variable rates to manage costs in light of the sweeping new reforms to the credit-card industry. The interest on variable-rate cards is tied to the rise and fall of the prime rate. The current prime rate is around 3.25 percent.

With his senior year at Franklin Military Academy fast approaching, Sgt. Maj. Kimara Davis is spending his summer honing his leadership skills. It’s not a school-based pursuit, though. Davis is getting his practice at the North Richmond branch of the YMCA, thanks to a program run by the Bank of America Charitable Foundation. He and four other area students are among 230 juniors and seniors nationwide participating in the foundation’s Neighborhood Excellence Initiative leadership program. Starting July 19, they’ll spend a week in Washington, where they’ll participate in workshops and seminars. The foundation also will fund eight-week paid internships at nonprofit groups—YMCAs, for the Richmond-area students.

Gary Gore is the new president of Bank of America’s Richmond market. Gore had been managing director and mid-Atlantic regional executive for Bank of America’s U.S. Trust, its private wealth-management division. Gore, 41, continues in that role, providing investment, trust and estate, banking, credit and wealth-management services to wealthy people in Virginia, Maryland and Washington.

Federal Reserve Chairman Ben Bernanke disputed accusations yesterday that he pressured Bank of America to acquire Merrill Lynch in a deal that cost taxpayers $20 billion. In a three-hour hearing of the House Oversight and Government Reform Committee, Bernanke denied threatening to oust Bank of America’s CEO Kenneth Lewis or the bank’s board members if they abandoned the takeover after discovering spiraling losses at Merrill.