Bank of America reported Q2/14 net income of $2.3 billion compared to net income of $4.0 billion in the year-ago period. Revenue, net of interest expense, declined 4% from the second quarter of 2013 to $22.0 billion.

The bank said results included litigation expense of $4.0 billion (pretax). The company also noted that it reached settlement with AIG to resolve residential mortgage-backed securities claims for $650 million.

The company noted that credit quality continued to improve with net charge-offs down 49% from Q2/13 to $1.1 billion. The net charge-off ratio of 0.48% was is the lowest in a decade the bank said. The provision for credit losses of $411 million was down 66% from $1.21 billion a year earlier.

“The economy continues to strengthen, and our customers and clients are doing more business with us,” said chief executive officer Brian Moynihan. “Among other positive indicators, consumers are spending more, brokerage assets are up by double digits and our corporate clients are increasingly turning to us to help finance business expansion and merger activity. We are well positioned for further progress.”

To read the entire Bank of America news release, click here.