Wachovia shares were off $2.70, or 9.7%, to $25.11 in early-afternoon trading.
The bank's net loss for the quarter was $393 million, or 20 cents per share, far worse than the $2.3 billion, or $1.20 per share, the bank earned in the same period a year ago.
Excluding items, Wachovia lost $270 million, or 14 cents per share. Analysts had expected earnings of 40 cents per share. Revenue fell 5% to $7.9 billion in the quarter. Wachovia slashed its quarterly dividend to 37.5 cents a share in an effort to save $2 billion annually.
"I'm deeply disappointed with our first-quarter results, but I am confident we're taking prudent and appropriate actions in this challenging period to restore Wachovia to a more profitable path," said CEO Ken Thompson.
It's the second time in as many months Wachovia has had to boost its capital position; the bank sold preferred shares and other securities to investors in late January and early February.
Wachovia's exposure to the mortgage meltdown increased when it bought Golden West Financial -- a company that specialized in nontraditional mortgages -- for $24.2 billion in May 2006 -- at the height of the housing boom.
