"We can start to see how [Brian Moynihan] can start running the company for shareholders and not litigants," says analyst Marty Mosby following Bank of America's (BAC +3.8%) $16.65B mortgage settlement with the government.
The removal of the legal overhang is nice as is today's rally, says portfolio manager Dave Ellison (an owner of the stock), but higher interest rates are necessary for a sustained move upward in the shares.
"We believe they have a wonderful franchise - the question now is, 'Do they,'" says fund manager Greg Donaldson. "If they do, their earnings will move sharply up because all of their energies will be poured into making their businesses better."
And from The Oracle - whose 700M warrants struck at $7.14, if exercised, would make Berkshire Hathaway BofA's largest shareholder? "[Moynihan] is nurturing a huge and attractive underlying business that will endure long after today's problems are forgotten," he said in his annual letter in 2012.
"It's definitely politics," Dick Kovacevich says of Bank of America's $16.65B mortgage settlement. "It has nothing to with justice or restitution to the innocent victims. In fact, more of the money is going to the coffers of the states and various departments than the victims."
Wells Fargo (NYSE:WFC) shareholders who remember the legal onslaught brought upon JPMorgan when Jamie Dimon dared to question U.S. regulators, can be thankful Kovacevich is a former chairman and CEO of their bank.
Kovacevich: "[Neither] JPMorgan or its employees [nor] Bank of America or its employees did anything wrong here. They just bought companies that did wrong ... Why are we charging the stock holders instead of going after the people who did wrong? Corporations don't engage in criminal behavior. They don't take advantage of innocent people. People do."
Previously tipped off as being about $17B, the $16.65B comprehensive mortgage-related settlement with the DOJ and six states' Attorneys General includes a $9.65B cash payment and about $7B of consumer relief.
The deal is expected to reduce Q3 pretax earnings by $5.3B and EPS (after tax) by about $0.43 per share.
CPA:18 Global is one of W.P. Carey's (NYSE:WPC) managed non-traded REITs and it has acquired a portfolio of 14 trade counter and industrial assets located in six trade parks throughout Scotland. CedarWood Asset Management will be the manager of the portfolio.
Main Street Capital (NYSE:MAIN) recently led a $15.9M deal to support the majority recapitalization of Mystic Logistics. Main Street funded $12.7M of the deal wit a $10M first lien senior secured loan and a $2.7M equity investment. In addition, Main Street and its partner are providing Mystic with a currently undrawn line of credit.
"We are pleased to look for opportunities to return value to our shareholders," says Citizens Holding Company (NASDAQ:CIZN) CEO Greg McKee. The 200K shares to be repurchased over the next three years represents about 4% of the float.
The shelf offering from Five Oaks Investment (NYSE:OAKS) allows for the sale of 6.485M shares and 3.125M warrants by company insiders. The warrants are struck at $15.75 per share and expire in September 2019.
The deal allows Golub Capital (NASDAQ:GBDC) at its discretion to offer and sell up to $75M of stock through the sales agent, UBS. The sales agent will receive a commission of 2% of the gross price of any sales.
At last night's closing price of $16.78 (above June 30 book value of $15.44), it would allow for the sale of nearly 4.5M shares.
In response to the NY Department of Financial Services' proposed "BitLicense", three of the biggest Bitcoin (COIN, OTCQB:BTCS) exchanges in China (BTCChina, Huobi and OKCoin) have released a joint letter addressed to NY regulators which warns of far-reaching consequences due to their pending legislation.
On July 17, the Department of Financial Services proposed issuing a BitLicense which would protect consumers, prevent money laundering and enforce cyber security, but the exchanges see too many restrictions in the proposed license.
At issue are enhanced customer checks and that restrictions in NY could lead to limitations in other jurisdictions.
In yet another decision to tighten foreign currency sales, Ukraine's central bank has announced that it is now mandatory for companies to sell all of their foreign currency income on the domestic market.
The new move is aimed at offsetting the pressure of a pro-Russian separatist revolt on the Ukrainian currency and requires banks to sell their foreign currency earnings the day after receiving the funds from companies.
The rule will apply until Nov. 21, but the central bank has extended similar regulations in the past.
Japanese stocks rose to a three-week high this morning, posting large gains for the ninth consecutive day, as a weaker yen shored up exporters after Fed meeting minutes raised the risk of an earlier interest rate hike.
The Nikkei closed at its highest level since July 31, climbing 0.9% to 15,586.20. The nine-days of straight gains was the index's longest streak since December.
The Topix also gained 0.9% to 1,291.19, while the JPX-Nikkei Index 400 rose 0.9% to 11,752.54.
Doral Financial (DRL +16.6%) and the Puerto Rico Treasury on August 11 entered court-supervised negotiations to settle Doral's lawsuit. The talks had 10 days to run as of August 11, so the shares are getting jiggy ahead of what could be the imminent announcement of a sweet payday for Doral.
To review, Doral has sued the Treasury over its annulment of a deal to refund $229M in taxes to the bank, and thus far, Doral has had its way in court.
UBS O'Connor LLC is a $5.6B hedge fund unit within the Swiss bank, and it has cut REIT holdings across the board by more than $900M after racking up big gains in the stocks this year.
The biggest reductions were in Mid-America Apartment Communities (MAA +0.3%), AvalonBay (AVB +0.8%), and Equity Lifestyle Properties (ELS +0.2%), and other holdings include Redwood Trust (RWT -0.8%) and American Realty Capital (ARCP +1.1%).
"Berkshire had owned convertible notes of USG since 2008 and was effectively forced to convert the notes when they were called for redemption by USG in December 2013," says Warren Buffett in a statement. "This event triggered a filing requirement for Berkshire (BRK.A, BRK.B) and we were late in realizing that fact.”
Alongside its just-declared $0.02 quarterly dividend, FICO (FICO -0.7%) announces a $250M share repurchase plan to replace the one just ended last month. The new plan is open-ended and - at the current stock price - would be enough to buy back nearly 14% of the float.
The Financial Stability Oversight Council, reports the WSJ, has closed the books on the evidentiary record it has been compiling, and could reveal this as soon as tomorrow. Though no names will be named, it's no secret MetLife (MET +0.3%) and the FSOC have been talking about the insurer's possible systemically important designation for months.