SAN FRANCISCO, Nov 4: Bank America Corp's trading income declined in October due to the gyrations in world markets, but the banking giant's trading operations remained profitable, chief financial officer Mike O'Neill said.

"We've been averaging trading profits of about $70 million monthly. If you look at October, we were below our average but we were still in the black," O'Neill told Reuters at the start of BankAmerica's 1997 investor conference.

Later in a speech to about 150 analysts and portfolio managers, chairman and chief executive officer David Coulter said, "We take a moderate amount of market risk and October was not as favorable, but the story has yet to be told for the rest of the quarter."

Neither Coulter or O'Neill would break out how much of BankAmerica's trading income is derived from Asia, where market turmoil was the most intense.

A BankAmerica spokesman said the San Fransisco-based bank has about $10 billion in loans outstanding in Asia, which represents about three per cent of the company's total loans outstanding.

Additionally, Coulter identified the Pacific Rim as one of BankAmerica's most promising growth areas. "Despite the market turmoil, this is a big growth area," he said.BankAmerica's Pacific Rim region represented 11 per cent of BankAmerica's net income in 1996.

The company's overall net income totalled $2.9 billion, with Asia contributing $237 million and Latin America about $96 million.

Coulter took the helm of BankAmerica in January 1996 and has since shed several underperforming assets, cut costs and made several strategic acquisitions to strengthten the company.

He told the people attending the bank's first investor conference in more than 20 years that he continues to advocate a strategy of tightening expense controls. For instance, he predicted that by the end of 1997, the expense base of the company's finance area should be down to $80 million from $120 million in 1996.

The chief executive also said he preferred an "add-on" strategy, in which the company makes several smaller acquisitions, rather than multi-billion blockbuster deals.

"The problem with blockbuster deals is that you take a bet and it takes you out of the market for 2-3 years and you have to take your eye off the ball," Coulter said.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.