Bank of America (BAC) today reported Q110 net income of $3.2bn, compared with a net loss of $194m in the Q409 and net income of $4.2bn in the year-ago quarter. The positive quarterly results from BofA — as well as JP Morgan Chase (JPM) — arrive amid ongoing loan losses as mortgage default and modification leads to write-downs. Provision for credit losses fell to $9.8bn in Q110, down by $3.6bn from the year-ago period, reflecting an improvement in credit quality. But net charge-offs rose to $10.8bn, from $8.4bn in the previous quarter, and $6.9bn in the year-ago quarter. “With each day that passes, the 2010 story appears to be one of continuing credit recovery, and our results reflect a gradually improving economy,” said CEO and president Brian Moynihan, in a press release. BofA extended $150bn in credit during the quarter, including $69.5bn in first mortgages and $10bn in commercial real estate loans. Funding for mortgages included $17.4bn in funding for nearly 115,000 low- and moderate-income borrowers. Approximately 37% of first mortgages were for home purchases. The volume of nonperforming loans, leases and foreclosed properties rose to $35.9bn, from $35.7bn in the previous quarter and from $25.6bn in the year-ago quarter. BofA expanded its default management staff by nearly 7% to more than 16,000 during the quarter to help customers experiencing difficulty with their home loans. During the quarter, BofA completed 77,000 loan modifications with total unpaid principal balances of $17.8bn, including 33,000 customers who converted from trial-period to permanent modifications under the government’s Making Home Affordable Program (HAMP). BofA’s results arrive after JP Morgan Chase reported Q110 net income of $3.3bn, despite a $1.2bn reserve increase for credit costs associated with Washington Mutual credit-impaired portfolios. “The firm’s net income of $3.3bn reflected another strong quarter for the Investment Bank, particularly in fixed income markets, and continued solid performance across asset management, commercial banking and retail banking,” said CEO Jamie Dimon in a press statement. “Unfortunately, these good results were partially offset by high losses in the consumer credit portfolios.” Home equity net charge-offs were $1.1bn in the quarter, unchanged from the previous-year quarter. Subprime mortgage net charge-offs were $457m, increased from $364m last year. Prime mortgage net charge-offs totaled $459m, compared with $312m in the previous-year period. Write to Diana Golobay. Disclosure: the author holds no relevant investment positions.