BofA's Ken Lewis: No Plans to Sell Credit Card Business

Bank of America CEO Ken Lewis told CNBC he sees no need to raise further capital right now and has plans to sell the bank's credit card business.

"It's an important product for us," Lewis said in a live interview when asked about the current scrutiny over credit card practices and possible new restrictions. "We may have to be more selective in our related to risk based pricing. We doe expect changes in the credit card business but we have no plans to sell."

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AP

Lewis made his comments after BofA posted a first quarter profit of $2.81 billion.

However, the stock fell as investors concerned about the banking industry's health sent financial stocks and the overall market sharply lower.

BofA fell by some 20 percent during the trading day.

"I'm disappointed in the stock's decline," Lewis said. "But I'm happy we made $4.2 billion dollars."

The first quarter results include revenue from the company's acquisitions of Merrill and Countrywide Financial, which Lewis said helped BofA's bottom line.

"I'm most pleased to have those two entities as different sources of income," said Lewis. "They made over $2 billion after taxes for us."

Lewis has been under intense pressure this year over the Merrill purchase, which closed Jan. 1.

Shareholders approved the deal before learning of big losses at the New York-based investment and reports surfaced that Merrill Chief Executive John Thain rushed out billions of dollars in bonuses to Merrill employees in his final days as CEO even as Bank of America was begging the government for aid to complete the deal.

Although Bank of America said higher revenue from the purchase of Merrill Lynch helped offset a surge in credit costs, it took a hefty $13.4 billion provision for credit losses during the first three months of the year.

(Watch the Video for the full interview)

"We have a ways to go before credit gets better," Lewis said. He also said that he expects consumer losses to continue through 2009 but "the silver lining is that recurring costs will go away."

When asked if the Columbia Managment unit of BofA was for sale, Lewis said no but that "the First Republic unit is for sale right now."

As for the economy making any kind of recovery, Lewis said, "We are seeing some signs that things are not deteriorating like they were before."

Lewis also said that BofA would like to pay back in 2009 the $45 billion TARP money it received but that the final decision on the re-payment is in the hands of government regulators.