Bank of America Corporation (BAC) - NYSE
  • Mon, Feb. 8, 2:24 PM
    • It is the European banks and contagion concerns that are freaking out the markets today - not just the Fed, China and crude oil - according to David Rosenberg, noting that some of the European banks are trading at 2008 crisis levels after the group has tumbled 18% YTD vs. 11% for the STOXX 600 index.
    • European financial firms are taking a beating amid fears of "a chronic profitability crisis that makes it impossible for banks to build up barely-adequate capital bases," WSJ reports.
    • Deutsche Bank (DB -9.8%) is down another ~10%, bringing its YTD loss to nearly 40% while its valuation has fallen to ~30% of book value, and its credit default swaps spiked to their highest levels since 2012.
    • News of major withdrawals out of Credit Suisse (CS -4.2%) caused its shares to sink 11% last week, hitting a 24-year low, and Santander (SAN -6.2%), BBVA (BBVA -5.4%), and UniCredit (OTCPK:UNCFF -5.5%) are down to lows seen during the last eurozone financial crisis.
    • "Oil and the flatter yield curve alone do not explain the 12% plunge we have seen in S&P Financials so far this year," Rosenberg says, adding that BofA (BAC -6.1%), Citigroup (C -6.2%) and Wells Fargo (WFC -3.5%) all briefly touched 52-week lows last week - "an ominous signpost."
    • ETFs: XLF, FAS, FAZ, UYG, VFH, PSP, IYF, EUFN, BTO, IPF, IAI, IYG, SEF, FNCL, FXO, PFI, IXG, PEX, RYF, FINU, KCE, RWW, KBWC
    • Earlier: Markets extend two-day rout; gold gets 3% boost
    | Mon, Feb. 8, 2:24 PM | 36 Comments
  • Tue, Feb. 2, 12:52 PM
    • Alongside energy's underperformance today is the financial sector (XLF -2.4%). The long-awaited hope of a sustained rise in interest rates appears dashed once again - at least so far this year.
    • The 10-year Treasury yield is lower by seven basis points to 1.88% - a nine-month low - and short-term rate markets are now pricing is less than one 25 basis point rate hike for the remainder of the year.
    • TBTFs: Bank of America (BAC -4.4%), Citigroup (C -4%), Goldman Sahcs (GS -4.4%)
    • Regionals: U.S. Bancorp (USB -2.5%), Regions (RF -3.1%), SunTrust (STI -4%)
    • Life insurers: MetLife (MET -3%), Prudential (PRU -3.2%), Lincoln Financial (LNC -3.7%)
    • Online brokerage: Schwab (SCHW -4.2%), E*Trade (ETFC -3.8%), Ameritrade (AMTD -3.6%)
    • ETFs: XLF, FAS, FAZ, UYG, KRE, VFH, KBE, IYF, BTO, IAT, SEF, IYG, FXO, FNCL, KBWB, FINU, QABA, KRU, KBWR, RWW, RYF, FINZ, KRS, XLFS
    | Tue, Feb. 2, 12:52 PM | 69 Comments
  • Fri, Jan. 29, 11:14 AM
    • The stock trades at a 20% discount to year-end estimated tangible book value of $17 per share, says CLSA's Mike Mayo. That's worse than the recessions in the early 1990s and early 2000s, despite better balance sheet strength today.
    • Further, the bank could grow book value even if the U.S. goes into recession.
    • There's also the chance BofA (BAC +1.1%) could become an "event-driven" stock, says Mayo. First, the 67% efficiency ratio is worst among the large U.S. banks, so there's plenty of room for improvement. Second, a sum-of-the parts analysis yields a result 40% higher than the current market cap. Third, shareholders are starting to speak up - while an activist is an outside shot, increased owner pressure seems likely.
    • He upgrades from Sell to Outperform, with price target of $16 up from (suggesting upside of less than 20%).
    • Previously: Mike Mayo calls bottom in BofA (Jan. 29)
    | Fri, Jan. 29, 11:14 AM | 38 Comments
  • Fri, Jan. 29, 9:47 AM
    • Saying the stock trades at a recession-level price to tangible book value ratio despite the absence of a recession, CLSA's Mike Mayo upgrades Bank of America (BAC +1.1%) to Outperform from Sell.
    • BofA is lower by 18.5% YTD and about 25% over the last six months. By comparison, Wells Fargo is down 9% YTD and 15% over the last six months, and JPMorgan 12% and 18%.
    | Fri, Jan. 29, 9:47 AM | 55 Comments
  • Thu, Jan. 21, 3:15 PM
    • The stock has given up another 2.6% today, even as the broader market rallies and its TBTF peers are just modestly lower. Shares are lower by 20% YTD, and 13.4% Y/Y.
    • Holding court at Davos, CEO Brian Moynihan says the job cuts will continue this year after more than 10K reductions in 2015. Total headcount at the bank is 213.3K. The efficiency ratio at BofA for 2015 of 68.6% is far worse than competitors like Citigroup (57%) and Wells Fargo (57.8%)
    • Cost cuts are nice, but revenue growth can also help that ratio. Expect that to remain challenging, however, even as the U.S. economy improves, says CFO Paul Donofrio.
    | Thu, Jan. 21, 3:15 PM | 72 Comments
  • Tue, Jan. 19, 11:06 AM
    • Expenses at Bank of America remain "way too high," says Oppenheimer's Chris Kotowski. "We are are still more struck by how far Bank of America (BAC -1.5%) still has to go to generate a competitive level of profitability.” The bank's efficiency ratio improved to 70.2% in Q4 from 74.9% a year ago. ROTCE of 7.3% rose from 7.1%.
    • Addressing the oil crash, new CFO Paul Donofrio says it's more supply than demand, He knows this, he says, because if demand for energy was dropping, it would show up in the asset quality of the bank's non-energy-related loans, and this isn't happening. Donofrio says energy makes up just 2% of the bank's loan portfolio.
    • As for consumer benefits, CEO Brian Moynihan says spending on credit and debit cards rose 4% Y/Y, but without the oil decline, it would have risen 5.7%. Putting a dollar number on it, that's $20M per day in savings to the bank's credit and debit card customers.
    • Earnings call presentation slides
    • Previously: Bank of America beats by $0.02, misses on revenue (Jan. 19)
    • Previously: Bank of America higher after bottom line beat (Jan. 19)
    | Tue, Jan. 19, 11:06 AM | 13 Comments
  • Tue, Jan. 19, 7:41 AM
    • Consumer Banking net income of $1.799B vs. $1.654B a year ago. Net interest income of $5.059B vs. $4.967B. Noninterest income of $2.733B vs. $2.792B, with lower mortgage banking income a drag. Noninterest expense of $4.343B vs. $4.419B. Provision for credit loss of $654M flat.
    • Global Wealth and Investment Management net income of $614M vs. $705M a year ago.
    • Global Banking net income of $1.378B vs. $1.520B a year ago.
    • Global Markets net income of $185M vs. a loss of $75M a year ago. Sales and trading revenue of $2.4B up from $1.7B, with notable improvements in rates and credit products.
    • Legacy Assets and Servicing net loss of $351M vs. $379M a year ago. Delinquent loans down 46% to 103K. Number of employees down 35% to 11.2K.
    • Total provision for credit loss of $810M vs. $219M a year ago. Net charge-offs of $1.144B vs. $879M. Net charge-off ratio of 0.51% up 11 basis pints. Energy is the culprit. Adjusted net reserve release this quarter of $195M vs. $509M a year ago.
    • CET 1 ratio of 10.8% up 80 basis points Y/Y.
    • Earnings call at 8:30 ET
    • Previously: Bank of America beats by $0.02, misses on revenue (Jan. 19)
    • BAC +1.8% premarket amid a general rally is U.S. stocks ahead of the open.
    | Tue, Jan. 19, 7:41 AM | 33 Comments
  • Dec. 16, 2015, 3:04 PM
    | Dec. 16, 2015, 3:04 PM | 48 Comments
  • Nov. 6, 2015, 10:04 AM
    • The major averages are lower following the blowout jobs number, but the financial sector (XLF +1%) is charging ahead, enthused at what appears to finally be the near-certain prospect of higher interest rates.
    • Short-term interest rate futures are pricing in about a 75% chance of a rate hike next month, and the 10-year Treasury yield is up nine basis points to 2.32%. The two-year yield has soared all the way to 0.90% - its highest level in more than five years.
    • The green in this yield-starved sector is everywhere: Bank of America (BAC +3.5%), Citigroup (C +3.4%), U.S. Bancorp (USB +2.8%), Regions Financial (RF +3.7%), PNC Financial (PNC +2.4%), Capital One (COF +1.4%), Bank of New York  Mellon (BK +1.9%), E*Trade (ETFC +3.5%), Schwab (SCHW +5.1%), Interactive Brokers (IBKR +3.4%), MetLife (MET +3.2%), Prudential (PRU +3.6%).
    • Previously: Big beat on jobs number (Nov. 6)
    • Previously: December rate hike back on after big jobs number (Nov. 6)
    • ETFs: XLF, FAS, FAZ, UYG, KRE, VFH, KBE, IYF, BTO, KIE, IAT, SEF, IYG, IAK, FXO, FNCL, KBWB, QABA, FINU, KRU, KBWR, RWW, RYF, KBWP, KBWI, FINZ, KRS, XLFS
    | Nov. 6, 2015, 10:04 AM | 43 Comments
  • Oct. 30, 2015, 7:42 PM
    • Bank of America (BAC -1.8%) has come to a $335M settlement of a lengthy federal suit where it was accused of misleading shareholders about mortgage-backed security exposure, and about its dependence on MERS, the national mortgage electronic registry.
    • In its 10-Q filing, the bank said the $335M was fully accrued as of June 30, though the deal still needs final court approval.
    • The suit was led by the Pennsylvania Public School Employees Retirement System, which said shareholders were misled into buying BAC stock in 2009 and 2010. It was allowed to go forward by a federal judge in July 2012.
    • Shareholders had claimed the bank knew it couldn't raise enough capital if it revealed it had to buy back billions of dollars in securities, and that it knew MERS was so shoddy that it wouldn't be able to legally foreclose on thousands of delinquent mortgages.
    | Oct. 30, 2015, 7:42 PM | 57 Comments
  • Oct. 14, 2015, 10:15 AM
    • Talking expense cuts on the earnings call, Bank of America (BAC +2%) CEO Brian Moynihan says it's happening in the back office - though overall headcount fell 1.5K in Q3, "client-facing" headcount added 1.6K workers.
    • Moynihan also notes job cuts are slowing - the bank had cut 3K or more workers in each of the previous 15 quarters.
    • Loan growth is the word: Excluding LAS (legacy assets & servicing), total loans and leases of $729B were up from $710B in Q2 and $668B a year ago.
    • Mobile banking users grew to 18.4M, with 14% of deposit transactions completed through mobile devices. Financial centers are down 4% from a year ago to 4,741.
    • Webcast and presentation slides
    • Previously: Bank of America higher after earnings beat (Oct. 14)
    • Previously: Bank of America beats by $0.04, beats on revenue (Oct. 14)
    | Oct. 14, 2015, 10:15 AM | 18 Comments
  • Oct. 14, 2015, 7:18 AM
    • Excluding market-related adjustments, net interest income of $10.3B slipped from $10B in Q2 and $10.54B a year ago. Noninterest income of $11.171B fell from $11.629B in Q2, and rose from $10.99B a year ago.
    • Excluding litigation, noninterest expense of $13.6B fell 4%. LAS noninterest expense excluding litigation of $900M fell 32%.
    • Tangible book value per share of $15.50 up 10%. ROA of 0.82%, ROTCE of 10%. Fully phased-in CET 1 ratio of 11% up 60 basis points.
    • Consumer Banking net income of $1.759B vs. $1.669B a year ago, on revenue of $7.832B vs. $7.749B. $13.7B of mortgages originated vs. $11.7B. Client brokerage assets of $117.2B up 8%.
    • Global Wealth and Investment Management net income of $656M vs. $812M a year ago, on revenue of $4.468B vs. $4.666B.
    • Global Banking net income of $1.277B vs. $1.521B a year ago, on revenue of $4.191B vs. $4.345B.
    • Global Markets net income of $1.008B vs. $371M a year ago, on revenue of $4.071B vs. $4.161B. The boost is income is thanks to lower noninterest expense thanks to lower litigation cost. FICC revenue excluding net DCA fell 11% from one year ago. Equities excluding net DVA increased 12%.
    • Conference call at 8:30 ET
    • Previously: Bank of America beats by $0.04, beats on revenue (Oct. 14)
    • BAC +1.4% premarket
    | Oct. 14, 2015, 7:18 AM | 17 Comments
  • Oct. 2, 2015, 9:08 AM
    | Oct. 2, 2015, 9:08 AM | 22 Comments
  • Sep. 22, 2015, 10:18 AM
    • Bank of America (BAC -1%) CEO Brian Moynihan can retain the chairman role as well after winning a hotly contested shareholder vote. Sixty-three percent of the votes were in favor of keeping the roles combined.
    • Special meeting webcast
    | Sep. 22, 2015, 10:18 AM | 65 Comments
  • Sep. 17, 2015, 2:37 PM
    • It'll be at least a little while longer until banks and insurers get the higher rates they are hoping will boost sluggish profits, as the Fed holds its fire this month.
    • The "dots" however are still projecting at least one rate hike before year-end.
    • The SPDR KBW Regional Banking ETF (KRE -1.4%), and the SPDR KBW Bank ETF (KBE -1.2%).
    • BofA (BAC -1.7%), Wells Fargo (WFC -1.2%), Regions (RF -2%), KeyCorp (KEY -1.8%), BB&T (BBT -1.7%), Fifth Third (FITB -2.4%), MetLife (MET -2.2%), Prudential Financial (PRU -1.9%), Schwab (SCHW -2.2%), Ameritrade (AMTD -2%), E*&Trade (ETFC -1.2%).
    • ETFs: XLF, FAS, FAZ, UYG, KRE, VFH, KBE, IYF, BTO, IAT, SEF, IYG, FXO, FNCL, KBWB, FINU, QABA, KRU, KBWR, RWW, RYF, PSCF, FINZ, KRS
    | Sep. 17, 2015, 2:37 PM | 16 Comments
  • Sep. 4, 2015, 7:00 PM
    • Influential proxy adviser Institutional Shareholder Services has joined the choir urging shareholders at Bank of America (BAC -1.8%) to strip CEO Brian Moynihan of his chairman's title.
    • With shareholders objecting since Moynihan got the additional title last year, the company promised a vote that was then moved sooner, to Sept. 22.
    • On Tuesday, the country's two biggest pension funds urged separating the roles at BofA, due to "inherent conflicts." Mike Mayo noted that letting Moynihan serve in both roles could bring more regulatory scrutiny.
    | Sep. 4, 2015, 7:00 PM | 24 Comments
Company Description
Bank of America Corp. operates as a bank holding company, which provides banking and nonbanking financial services and products through its banking and various nonbanking subsidiaries throughout the U. S. and in certain international markets. It operates through five segments: Consumer and... More
Sector: Financial
Industry: Regional - Mid-Atlantic Banks
Country: United States