CHARLOTTE, North Carolina (AP) — Hurt by the deepening credit crisis, Bank of America Corp. said yesterday its fourth-quarter earnings fell 95 percent, and Wachovia Corp. reported that profit tumbled 98 percent.

Net income at Bank of America, the nation's second-largest bank, dropped to $268 million, or five cents per share, in the three months ended December 31, from $5.26 billion, or $1.16 per share, a year earlier.

The bank's revenue fell 31 percent to $12.67 billion, from $18.49 billion last year.

The results included LaSalle Bank, which Bank of America purchased on October 1.

Analysts expected, on average, earnings of 18 cents per share on revenue of $13.24 billion, according to a survey by Thomson Financial. The estimates typically exclude one-time items.

Bank of America shares rose 93 cents, or 2.5 percent, to $36.90 in morning trading.

Cross-town rival Wachovia said its fourth-quarter profit fell to $51 million, or three cents per share, from $2.3 billion, or $1.20 per share, during the same period a year earlier. Excluding merger-related expenses, Wachovia earned $160 million, or eight cents per share, in the fourth quarter.

Analysts surveyed by Thomson Financial, on average, forecast earnings of 33 cents per share for the quarter.

Wachovia, the nation's fourth-largest bank, took a $1.7 billion write-down during the quarter due to weakening credit markets. Banks have been forced to reduce the value of bonds and debt backed by mortgages and other consumer loans that have increasingly defaulted in recent months.

Because of rising delinquencies and defaults, Wachovia also set aside $1.5 billion to cover losses.

"These actions were necessary based on what we believe is a very realistic view of the market challenges that we face in 2008," said Wachovia chief executive Ken Thompson on a call with analysts.

Wachovia shares rose 20 cents, or more than 0.65 percent, to $31 in morning trading.

The news was the latest in a series of declines in profit or losses at the largest US banks as the nation's housing crisis and a slowing economy have forced many consumers to fall behind on their bills.

Last week, New York's Citigroup Inc., the No. 1 US bank by assets, reported a nearly $10 billion loss, and JPMorgan Chase & Co., the third-largest U.S. bank, saw its profit fall 34 percent to $2.97 billion, or 86 cents per share. San Francisco's Wells Fargo & Co., the nation's fifth-largest bank, reported net income dropped 38 percent to $2.18 billion, or 64 cents per share.

Bank of America's results included $5.44 billion of trading losses, compared with profit of $460 million a year earlier. This reflected a $5.28 billion write-down related to collateralised debt obligations, which the bank said reduced trading profit by $4.5 billion and other income by about $750 million.

CDOs are complex investments that combine slices of different kinds of risk and are often backed in part by sub-prime mortgages — loans given to customers with poor credit history — as well as other loans. In November, Bank of America executives estimated pretax CDO write-downs of at least $3 billion.

During the quarter, the company's provision for credit losses doubled to $3.31 billion from $1.57 billion a year ago. In the bank's consumer unit, which includes the nation's biggest credit card business and retail branch network, revenue rose seven percent, while earnings dropped 28 due to higher credit costs.