Citigroup and Bank of America warned they remained exposed to bad loans in the US housing market, which has long been at the heart of the global financial crisis. Citigroup set aside another $3.9 billion and Bank of America $4.7 billion for future losses.

Citigroup's Smith Barney sale netted the company $6.7 billion after taxes while Bank of America brought in $9.1 billion from two asset sales, creating questions as to whether the companies could continue to earn profits in the near term.

'Our most significant challenge now remains consumer credit,' Vikram Pandit, Citigroup's chief executive officer, said in a statement. 'Losses in our consumer businesses have been growing for some time, but we see some positive signs of moderation in those loss trends.'

Bank of America's CEO Kenneth Lewis warned rising unemployment was driving fears that more Americans will default on their loans. The weak economy was likely to continue until 2010, he said.