"Don't confuse brains with a bull market," writes Mike Mayo, reiterating his long-held (relative) bearish stance on Bank of America (BAC) and its leader Brian Moynihan. Yes, the shares have done well, but so has the market, particularly the banks. BofA, says Mayo, has trailed the KBW Bank Index by 5800 basis points since Moynihan took over in 2010.
It's a muddled message, says Mayo, to put slimming-down efforts front and center while also bragging about the size and scope of the bank. One of the areas of retreat - the mortgage business in 2011 - cost the bank billions, he says.
Also at issue is the bank's decision to measure progress using different metrics than previously. “We’ve reviewed several annual reports and presentations and can’t seem to connect the aspirational pie-in-the-sky statements with progress reports ... (it) raises questions about data integrity, consistency and information systems."