UPDATE 6-Bank of America net down 77 pct on credit losses

(Rewrites first paragraph, adds CFO, analyst comments)

By Jonathan Stempel

NEW YORK, April 21 (Reuters) - Bank of America Corp (BAC.N: Quote, Profile, Research), the largest U.S. retail bank, posted a 77 percent decline in quarterly profit on Monday, as a growing number of consumers and real estate developers failed to repay loans.

Profit dropped for a third straight quarter and slid more than analysts expected, dragged down by what Chief Executive Kenneth Lewis called a "litany of negative issues," including more than $5 billion of write-downs and credit-related costs.

Bank of America said the housing market will remain weak all year, as credit problems once concentrated there spread into other areas such as credit cards.

The bank also quintupled the amount it set aside for bad loans to $6.01 billion and said the economy might grow little or shrink this quarter.

"It would be too early to strike up the band and sing 'Happy Days Are Here Again,'" Chief Executive Kenneth Lewis said on a conference call.

First-quarter net income fell to $1.21 billion, or 23 cents per share, from $5.26 billion, or $1.16, a year earlier. Results included a $776 million pre-tax gain from credit card network Visa Inc's (V.N: Quote, Profile, Research) initial public offering last month.

Excluding merger costs, profit was 26 cents per share, below the average analyst forecast of 45 cents, according to Reuters Estimates. Net revenue dropped 6 percent to $17 billion, but topped the average $16.33 billion projection.