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The recent sale of Bank of America's (BAC) China Construction Bank stake is just the latest in a...

The recent sale of Bank of America's (BAC) China Construction Bank stake is just the latest in a series of moves by which embattled CEO Brian Moynihan has dismantled much of the empire built by Ken Lewis. SNL Financial's Nancy Bush sees Moynihan's actions as emblematic of a new generation of bankers who don't equate "bigger" with "better."
Comments (3)
  • So what is the enterprise value after you sell off all the assets anyway?
    30 Aug 2011, 06:12 PM Reply Like
  • What a bunch of trash this article is. It tries to state Moneyham is some new generation banker. Bottom line he wouldnt be selling anything if he didnt have to in order to save BAC hide. BAC is very much in deep trouble and that and the solvency of the bank is the only reason he has to sell the assets that they have. It has nothing to do with some new era philosophy.
    30 Aug 2011, 06:18 PM Reply Like
  • Bankingqueen,

     

    Well personally, I can't be so sure that they are actually in trouble, and I'm not quiet sure that they need so much money... It's more likely that they prepare themselves to a possible recession and they try to get as much cash as they can to go through the crisis and than to be able to reinvest it better, as soon as it would be over.

     

    Nevertheless, as the BAC's share worth 8 bucks, you see that BofA isn't solid enough to support his deficit departments, as they could have done a year ago. They need to find a quick way to bring their profit back, and I don't see a better way than selling the departments that make no benefice at all and that drug them even into red!

     

    Take for example a chain store. Some of the stores make a big profit, while others make the main company lose money because the costs are higher than
    the revenue. So why wouldn't the company sell those stores and even make a profit on the sale! It's in contrary, a good piece of news, for BofA, cause the CEO has finally decided to take his responsibilities and takes the wright measures to bring the bank back to the top with lower expanses and a higher ability to make profit! It has got way too big and way too fast, due to some unconsidered investments, so now they will simply start over with an extremely high cash-flow... The BofA future now only depends of its board, cause they have everything they need to succeed!
    31 Aug 2011, 05:57 PM Reply Like
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