Bank of America, which is the largest in the US by assets, has posted a 38% decline in profits for the first quarter.

The bank said profits came in at $2 billion (£1.23 billion), a sharp fall compared with a year ago.

Furthermore, its home loans business lost $2.39 billion, as debts were not repaid.

Rising unemployment and a drop in property prices has resulted in many US households defaulting on their mortgages.

The figures came as a disappointment to analysts after rival JP Morgan revealed better than expected results on Thursday.

Banking giant JP Morgan’s first quarter profit swere boosted by a strong performance in its credit card operation.

Goldman Sachs, Citigroup Inc., Morgan Stanley and Wells Fargo Co. are scheduled to report their first quarter earnings next week.

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