Rising losses from consumer and commercial loans dragged Bank of America Corp. (BAC) to a third quarter loss of $1 billion despite impressive trading and investment banking revenues, which were helped in part by the Charlotte bank’s purchase last year of Merrill Lynch & Co.

Bank of America’s report holds signs of hope for the banking industry, which is struggling to hold down losses as rising unemployment and a U.S. economic recession have followed a nationwide slide in housing prices.

The bank’s credit card business took permanent losses of $6.5 billion from bad debt – a hefty amount, but about equal with last quarter. The bank also withdrew cash from its account for future loan losses tied to credit cards, instead of adding to the reserve, which suggests the bank expects troubles with its credit card accounts to begin slowing in the near future.

NEW YORK, July 22 (Reuters) – Wells Fargo & Co (WFC.N) and other major U.S. banks said the troubled economy drove big increases in loan losses, reducing second-quarter earnings.

Wednesday’s results provided fresh evidence the nation’s banks still face a rough road as loan losses once concentrated in home mortgages migrate to commercial loans, commercial real estate loans and credit cards.