Bank of America (NYSE:BAC) reported a fourth-quarter loss of $5.2 billion, or $0.60 per share, this morning. Stripping out a one-time loss from repaying TARP, and preferred dividends associated with that deal, the loss would have been just $194 million.

That's not bad, but we need to dig deeper. Breaking quarterly income out by segment (net of the TARP charge), here's what you get:

Segment

Q4 2009

Q3 2009

Deposits

$595 million

$798 million

Credit cards

($1 billion)

($1 billion)

Home loans and insurance

($993 million)

($1.6 billion)

Global banking

$264 million

($40 million)

Global markets

$1.2 billion

$2.2 billion

Wealth management

$1.3 billion

$274 million

Other

($1.5 billion)

($1.6 billion)

Total

($194 million)

($1 billion)

A few notable points:                                                                                                            

  • Credit cards are still extremely weak. That was expected.
  • Home-loan losses improved meaningfully.
  • Global markets -- think trading -- fell dramatically.

Nothing too remarkable here, except for the decline in global markets. We saw similar segment declines at Citigroup (NYSE:C) and JPMorgan Chase (NYSE:JPM) when they reported earnings over the past few days. There's clearly a market trend eroding the staggering profits that banks pulled from this segment over the past year. The biggest takeaway is what that means for the bank that relies almost 100% on this area -- Goldman Sachs (NYSE:GS). Goldman reports earnings tomorrow morning. If the same trend in capital markets continues, it could be a very, very interesting report.

Moving on to B of A's credit quality:

Metric

Q4 2009

Q3 2009

Q2 2009

Q1 2009

Loans 90+ days past due

$16.8 billion

$7.6 billion

$6.4 billion

$6.3 billion

Nonperforming loans / total loans

3.75%

3.51%

3.12%

2.47%

Allowance for losses / nonperforming loans

111%

112%

116%

122%

Total net charge-offs

$8.4 billion

$9.6 billion

$8.7 billion

$6.9 billion

To say that credit has stabilized is being generous. Overall, it still ain't a pretty picture. Nonperforming assets are increasing while the proportional allowance for losses is decreasing. Granted, B of A spent the last year bulking up its loss reserves like a champion. But it's a bit brave to conclude that the credit-quality thunderstorm that's utterly crushed B of A's earnings potential is over.

What's your take? Share your thoughts in the comments section below.

Fool contributor Morgan Housel doesn't own shares in any of the companies mentioned in this article. The Fool has a disclosure policy.