B of A cuts money its sets aside for bad loans (CBS/AP) NEW YORK - Bank of America (BAC) said Thursday that it set aside less money to cover bad loans in the first three months of the year than it has since before the 2008 financial crisis. Because Bank of America serves about half the nation's households, the results could be seen as a statement about the progress Americans have made in managing their household finances, saving more and paying back debt. The bank said it put aside $2.4 billion for bad loans, down from $3.8 billion in the same quarter a year ago and the lowest since the third quarter of 2007, a year before the financial crisis. Bank of America earns 3 cents per share JPMorgan Chase earns $5.4B, beats estimates Wells Fargo beats earnings expectations It earned $653 million in the first quarter, down 68 percent from last year. The profits were hurt by a $4.8 billion accounting charge that the bank had to take because the value of its debt rose. Just like American households, Bank of America has been cutting costs and paying back debt. CEO Brian Moynihan has been on a mission to simplify the behemoth bank. "Our strategy is paying off," he said Thursday. The stock fell 14 cents to $8.78. Investors seemed happy that there weren't any big hits to the most important parts of Bank of America's business. Last year, the bank took an $8.5 billion charge related to a mortgage settlement with investors, and in 2010 the bank wrote down $10.5 billion in its credit card division because of losses related to new regulation. Bank of America has had a bruising few years. It took $45 billion in government bailouts during the financial crisis and has suffered deep losses since then on mortgage-related losses and settlements. Not all investors believe the comeback is complete. Matt McCormick, a portfolio manager and banking analyst at money manager Bahl & Gaynor, points out that the first quarter's profit pales in comparison to the 72 percent gain in Bank of America's stock. "The narrative is that Bank of America is steadily improving, but there are still underlying weaknesses," said McCormick. The mortgage hangover continues at the bank. It is still losing money in its mortgage business and buying back soured loans from the government. The losses did narrow in the quarter, to $1.1 billion from $2.4 billion. Revenue from real estate increased slightly, to $2.7 billion, and the bank said it refinanced more loans. Mortgages were a big driver of earnings at Bank of America's rivals Wells Fargo (WFC) and JPMorgan Chase (JPM) in the first quarter, as the housing market starts to recover. Mortgage rates hit a historic low in February, and job growth has mostly improved in recent months. The government also expanded a program that helps Americans with troubled home loans to refinance. Bank of America didn't get much pop from mortgages because it stopped writing mortgage loans for third-party lenders in the fourth quarter of last year. Glenn Schorr, bank analyst at brokerage firm Nomura, noted that the bank issued 73 percent fewer mortgages in the first quarter. Bank of America's income from its bank customers fell $587 million to $1.5 billion. It collected less in fees from stores processing debit card transactions because of new regulations that limit those fees. The bank's income from investment banking was flat at $1.6 billion when compared to the same period last year. The business bounced back from the fourth quarter with an 11 percent increase. In the last two quarters, sales and trading have been light because of turbulence in the markets, but Bank of America's fourth-quarter performance was worse than its peers.