Bank of America Corp., the largest U.S. lender by assets, topped analysts’ estimates by reporting that its first-quarter profit more than tripled on gains from home refinancing and trading.

However, Bank of America is facing “extremely difficult challenges primarily from deteriorating credit quality driven by weakness in the economy and growing unemployment,” Chairman and CEO Kenneth Lewis said today in a report by MarketWatch.

Lewis said unpaid loans are increasing because of the weak economy and rising unemployment.

Bank of America’s net income rose to $4.25 billion, or 44 cents per share, from $1.21 billion, or 23 cents a share, the company said in a statement.

The latest earnings figure takes into account preferred dividends to the U.S. rescue fund. The quarter included an addition of $6.4 billion to loan-loss reserves.

Lewis is under pressure from shareholders after Bank of America spent more than $30 billion on takeovers during the past year as the recession worsened. Lewis said Feb. 26 that the purchases of Merrill Lynch & Co. Inc. and Countrywide Financial Corp. were “the two stars” driving profits, Bloomberg reported.

“Question marks remain on this company’s earnings for the rest of this year because of the continuing credit quality problems,” said Bert Ely, CEO of Ely & Co., a bank consulting firm. Investors will be looking for signs that the bank’s earnings will recover enough to absorb losses from soured loans, he said.

Bank of America follows JPMorgan Chase & Co., Goldman Sachs Group Inc. and Citigroup Inc. in posting first-quarter earnings that topped analysts’ estimates.