NEW YORK - BANK of America, in an early release of its financial results, said it earned a profit of 1.18 billion (S$1.73 billion) in the past quarter despite fresh writedowns, and said it was raising US$10 billion in capital.

The earnings report, two weeks ahead of schedule, came amid ongoing turmoil in the the global financial sector that has led to a massive loss of confidence and meltdown in global markets.

'These are the most difficult times for financial institutions that I have experienced in my 39 years in banking,' said Mr Kenneth Lewis, chairman and chief executive.

'We believe it is prudent to raise capital to very substantial levels in this uncertain environment. Both economic and financial market conditions have changed significantly in the last two months.'

The profit marked a sharp decline from the level of US$3.7 billion a year ago but the firm nonetheless earned a profit and averted the massive losses of some of its peers.

The profit amounted to 15 cents a share.

The company said it intends to sell common stock to raise US$10 billion to shore up its capital and slashed its dividend in half to 32 cents a share, a move that would add more than US$1.4 billion to capital each quarter.

'We know many investors in our stock are quite disappointed with a dividend reduction,' Mr Lewis said.

'It is not a decision we made lightly. However, we cannot pay out what we have not earned. Our goal is to resume dividend increases from the new level as soon as our earnings performance warrants.

'All that said, our company continues to be profitable, and we have been able in the last year to make a number of moves that should significantly enhance our earnings when economic and financial market conditions improve.' -- AFP