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BofA fields questions on accounting foul-up at annual meeting

  • "It was disappointing to all us," says Bank of America (BAC +1.1%) chief Brian Moynihan of the accounting error which forced the suspension of the lender's buyback and dividend hike. The error, says CFO Bruce Thompson (under questioning by Mike Mayo), was discovered while preparing the 10-Q and reported to the board within 24 hours.
  • The bank has until May 27 to resubmit financial templates to the Fed, and the central bank will then have 75 days to respond.
  • In other news, the bank's executive compensation plan is approved with 93% of votes in favor. The directors were also approved, as was BofA's accounting firm PricewaterhouseCoopers.
  • Webcast
  • Presentation slides
Comments (29)
  • jackooo
    , contributor
    Comments (1505) | Send Message
     
    I am awe struck that the board won by 93%. The shares are dead in the water! The error in accounting should require someone to lose their job. What are the share holders doing but anointing the same clowns?
    7 May, 12:45 PM Reply Like
  • Eightball
    , contributor
    Comments (134) | Send Message
     
    I agree. They are being paid entirely too much money given the horrible job running the company. Very frustating!
    7 May, 12:47 PM Reply Like
  • papayamon
    , contributor
    Comments (1105) | Send Message
     
    It's easier to be an armchair quarterback than it is to get down and dirty in the game. In the next few months, this will be forgotten. It is an event without economic consequence compared to the value of BAC's enterprise.

     

    Should they fire someone to make some people feel better? If they were restating earnings, I would agree with you. But this is just regulatory nonsense.
    7 May, 01:01 PM Reply Like
  • jackooo
    , contributor
    Comments (1505) | Send Message
     
    Armchair quarter backing does not earn millions upon millions and then some.
    It has been over 6 yrs. since the bailout. Dividend is minuscule and stock appreciation the last four months the same to negative.
    So what has gone up dramatically? Salary and stock options. Not for me, but for the board of directors and BAC officials.
    It is not one thing such as this so called error but a multitude of things that keep on going like the Energizer bunny!! All calculated to make the piggy last until the bank is broken.
    When Holder and Obama are gone things have to get better, but holding for the remaining three years is a risk.
    7 May, 01:26 PM Reply Like
  • jackooo
    , contributor
    Comments (1505) | Send Message
     
    This is what I would of expected from BAC share holders votes....

     

    NEW YORK (MarketWatch) -- J.P. Morgan Chase & Co.'s (JPM) executive compensation package will not be supported by one of the biggest proxy advisory firms at the bank's upcoming annual shareholder meeting, according to a report in The Wall Street Journal. Influential corporate-governance watchdog Glass Lewis released a report this week saying the gap between the bank's pay and performance needs to be narrowed. The advisory firm gave the bank a "D" grade on pay-for-performance policies, up from an "F" grade from last year. J.P. Morgan's annual meeting will be held in Tampa, Fla. on May 20. In 2012, CEO Jamie Dimon's pay was cut by 50% after the so-called London Whale debacle lost the firm more than $6 billion.
    7 May, 01:47 PM Reply Like
  • papayamon
    , contributor
    Comments (1105) | Send Message
     
    Wow. I've never met an experienced investor who expects stock appreciation to go in a straight line, or management is corrupt and should be strung up. Have you tried looking at the stock performance over the last year? Or do all your stocks appreciate every quarter?

     

    If you run a giant company, you make big bucks. Yes, I want these guys to be compensated with stock options. I can't think of a better way to align management desires with shareholders.
    7 May, 01:52 PM Reply Like
  • jackooo
    , contributor
    Comments (1505) | Send Message
     
    papa
    Well it isn't working!!!!
    7 May, 02:55 PM Reply Like
  • vman
    , contributor
    Comments (146) | Send Message
     
    If I don't do my job right... I get fired. If they don't do their job right they get "big bucks" and "stock options." What if you didn't do your job right... I'm sure you would get a raise and options. I am in the health industry... people could die if I screw up... guess what they would do to me.... my job has someone's life in my hands. I've only had a 2% pay raise in 7years. BAC management loses billions... let's give them more big bucks and stock options.....
    7 May, 03:15 PM Reply Like
  • Ruffdog
    , contributor
    Comments (1317) | Send Message
     
    I voted against them and the compensation package.
    7 May, 03:28 PM Reply Like
  • Morrie
    , contributor
    Comments (29) | Send Message
     
    Papayamon, yes someone should be fired if thats what is required to get their attention. We have witnessed vast numbers of poorly managed companies who could not/did not survive the crash. Not all were due to "error" but many had carried criminal balance sheets for years and yet, no one has gone to jail. I was raised to believe that we had a legal system that made us very different from other countries but I no longer believe this to be the case. BAC execs have been some of the most highly compensated people in business and they owe their shareholders integrity, which in my book includes checking the books for error before reporting. Absolutely unacceptable.
    7 May, 03:36 PM Reply Like
  • papayamon
    , contributor
    Comments (1105) | Send Message
     
    Ok, if it is unacceptable, other than complain on a message board, what are you going to do? Why not just sell your shares if this is all so bad? Or better yet, short it.

     

    In the next couple of years, BAC will be kicking ass and taking names. This will be at $25 in 2 years.
    7 May, 03:50 PM Reply Like
  • Eightball
    , contributor
    Comments (134) | Send Message
     
    Papa, how has Moynihan done a great job? He is not a great speaker; he has not articulated or delivered a great strategy for the bank; and he has twice promised and then not delivered dividend increases. He's had plenty of time and last year received over 11 million in compensation, this year likely the same. For what exactly?

     

    And I've owned and been following the stock for 20+ years.
    8 May, 11:57 AM Reply Like
  • Foofmfgman
    , contributor
    Comments (20) | Send Message
     
    Not really an accounting error
    8 May, 10:43 PM Reply Like
  • gwynfryn
    , contributor
    Comments (4018) | Send Message
     
    Engineers are expected to do their jobs, and to the best of their ability, for the going salary, pap, so why can't we expect that, from executives who are so much better paid, already? Seems to me it's other executives just lining their collective nests and protecting their own golden parachutes, whom I suspect are among the majority of those who made it 93%! Such a system just begs for misuse...
    9 May, 11:37 AM Reply Like
  • papayamon
    , contributor
    Comments (1105) | Send Message
     
    If people think this is so awful and they are running the company in the ground, they should make the EASY money and SHORT this thing to high heaven. Just don't be surprised if the "inept" BAC management hands you your rear end on a platter. It's coming. $20 in the next 3 quarters.
    7 May, 01:05 PM Reply Like
  • larrydino
    , contributor
    Comments (3) | Send Message
     
    I cannot believe that the Accounting Firm (PricewaterhouseCoopers) was approved. Is anyone accountable for this accounting over site to go on for so many years? The share holders who have been so patience for years, waiting for some professional turn around in the bank's management team, now get nothing but a kick in the back side. All we see is law suit after law suit, with no end in sight. Moynihan and his highly paid Directors and Management team should have been immediately on top of all the Ken Lewis created problems and made that their number one priority. I am disappointed and very discouraged with Moynihan's leadership capabilities. I think it is time for share holders to take whatever loss or gain they may have and move on.
    7 May, 01:13 PM Reply Like
  • Zocman
    , contributor
    Comments (8) | Send Message
     
    They were smart enough to have the election before the bad news was released.
    7 May, 01:13 PM Reply Like
  • vman
    , contributor
    Comments (146) | Send Message
     
    Funny how that always seem to happen...
    7 May, 03:16 PM Reply Like
  • foxchena
    , contributor
    Comments (34) | Send Message
     
    After sitting through the complete webcast, hearing the statistics of the turn around, realizing the size of this company and what it has taken to redirect the machinery of such a large enterprise to its current state I am quite impressed with what Moynihand has accomplished, he sounds very sincere to me. The results are there, the future looks promising barring no major surprise in new litigation or lack of accruals for current know battles. I am hopeful for the future, I am disappoint in the last two weeks as I have been heavily invested since the $10.00 mark. Hopefully the statements made by management in the webcast will manifest into results. Best of luck to all BAC investors.
    7 May, 01:27 PM Reply Like
  • cwirtz2000
    , contributor
    Comments (5) | Send Message
     
    Weak hands should sell their shares. I'm holding mine and may even add to my position on this dip. Nothing fundamental has changed and mistakes do happen. This wasn't accounting irregularities or material misstatements to the financial statements and basically just means a delay in when BAC will be able to increase its returns to shareholders.
    7 May, 01:28 PM Reply Like
  • KenFF
    , contributor
    Comments (60) | Send Message
     
    'scuse me. Wasn't the vote before the error was found???
    7 May, 02:15 PM Reply Like
  • vman
    , contributor
    Comments (146) | Send Message
     
    Amazing isn't it?
    7 May, 03:21 PM Reply Like
  • overunder
    , contributor
    Comments (29) | Send Message
     
    I've held most of my shares since well before 2008. This is why the stock's performance over the last year doesn't impress me much; I've still lost a fortune on paper. I bought a handful of shares at $6 something but have little else to be happy about. Heaven knows this stock has been heavily shorted in the past for good reason.
    Moynihan should never have been hired. The top executives needed to have come from outside. It was a see-hear-speak no evil Board under Lewis and is BAU under Moynihan. I agree that this accounting error will be forgotten in a few months, but that's only because people will be focused on the $13 billion or so suit. And there will be many more after that. There is absolutely no way these litigations are going to go away. If the size of the extortions wind down it'll be balanced out by the sheer numbers being ramped up. And...worst case scenario...when Sen. Warren becomes Pres. Warren your shares may at least be worth pennies on the hope of being rescued by the U. S. Supreme Court.
    7 May, 02:32 PM Reply Like
  • alenworn
    , contributor
    Comments (32) | Send Message
     
    i got in at 45 and went to the brink at $5. I have been accumulating and will wait a couple of more years. The only concern i have is if more litigation keeps popping up and they can never get to the end of it.
    7 May, 02:38 PM Reply Like
  • SA_Member_4576931
    , contributor
    Comments (19) | Send Message
     
    Pretty sure the error was under the previous CEO from the Merrill acquisition.
    7 May, 03:05 PM Reply Like
  • fish77
    , contributor
    Comments (8) | Send Message
     
    Are the big banks just too big to manage correctly or are the managers just not as smart as we have been led to believe? Perhaps a deadly combination of both?
    7 May, 03:53 PM Reply Like
  • Daniel Radakovich
    , contributor
    Comments (599) | Send Message
     
    Small mistake, had no impact of GAAP earnings. What's the big deal? Should've bought it at $5...when everyone was scared...................
    7 May, 09:06 PM Reply Like
  • xshs79
    , contributor
    Comments (22) | Send Message
     
    Maybe we should break up the big department stores too. Macys and Walmat are just too big to Manage. (That sounds as dumb as breaking up banks)
    7 May, 09:12 PM Reply Like
  • gwynfryn
    , contributor
    Comments (4018) | Send Message
     
    Why, M and W are just trying to sell goods, whereas the big banks are running several entirely different activities, which can lead to both undue complexity and opaqueness, and to conflicts of interest; not the same thing at all!
    9 May, 11:40 AM Reply Like
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