BankAmerica Loses $1.1 Billion

BankAmerica Corp., the nation’s second-largest bank holding company, today posted a $1.1-billion loss in the second quarter, reflecting its decision to increase loan-loss reserves to cover shaky Third World loans.

The company, which added $1.1 billion to its reserves, was among several major U.S. banks to report a large loss because of that accounting action. By sharply boosting reserves, banks reduce their current earnings but establish a cushion to protect future earnings from loans that must be written off or disposed of at a loss.