Monday, July 18, 2011

BofA chief may have to sell assets

The NY Post writes: forget the American dream. For Bank of America boss Brian Moynihan, it's more like an American nightmare. The CEO of the nation's No. 1 lender finds himself overseeing Wall Street's biggest problem, having already agreed to $30 billion in toxic-mortgage settlements and writedowns and now facing the real threat of possibly being forced to sell off some assets to raise capital.

Those massive problems come on top of the looming state investigation into whether a recent $8.5 billion settlement with mortgage-bond investors is adequate, its share price crashing 27 percent this year into single digits -- and the expected $9.1 billion second-quarter loss the Charlotte, NC, bank is expected to report today.
"[BofA's management] has continued to underestimate the balance sheet problem and liability issues they have," said Jonathan Finger of Finger Interests, a major BofA shareholder.

That's a far cry from the plan of former CEO Ken Lewis, who led the 2008 purchase of Angelo Mozilo's Countrywide Financial -- the nation's No. 1 mortgage lender -- because he wanted the banking behemoth to be a big part of the American Dream. Some dream. Analysts estimate that Moynihan may have to dig even deeper into his pocket to tackle costly litigation it inherited from the Countrywide deal and the ongoing foreclosure mess.....


Read more: http://www.nypost.com/p/news/business/brian_bum_bank_YMSJVa4MwOTHMsSrTad0lK

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