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September 10, 2013

On Bank Of America’s Removal From The Dow Jones

stupidlittletuftybeard says: Slumping stock performance from Bank of America? What the hell are they talking about?

» SFB says: While graphs of several recent time periods (6 months1 year) would give the impression that Bank of America is performing strongly on the market, the company isn’t performing so hot when compared to the five-year turnaround of other prominent American banks like Capital One and/or new DI member Goldman Sachs. Both of those companies, along with a number of other financial organizations, have seen their shares return (and in many cases, surpass) their values just before the “Great Recession”. Meanwhile, though Bank of America has been trending upward for several years, the company still remains well below fifty percent of its pre-Recession value. Given that the Dow Jones is meant to be a semi-accurate indicator of the market’s strength on any given day, if we had to guess, we’d assume the people in charge of this particular decision likely realized that using one of the banking sector’s worst performers wasn’t the best way to get the job done.—Scott @ SFB

Editor’s note: Not that you would, but don’t use this commentary as stock market advice.

19:35 // 1 year ago

Major changes coming to the Dow Jones Industrial Average before the end of September

  • In Goldman Sachs, Visa and Nike have been added to the Dow Jones industrial average, replacing several poorly performing companies from the exclusive group of 30 publicly-owned corporations. The new Dow Jones additions are also expected to diversify one of the most-commonly used gauges of the U.S. stock market.
  • Out To make room for the new arrivals, Alcoa, Hewlett-Packard and Bank of America have been removed from the Dow, following consistently slumping stock performances from each. The changes are set to take effect on September 23, and represent the largest alteration of the Dow Jones line-up in roughly a decade. source
14:12 // 1 year ago
August 6, 2013

Bank of America faces suit from SEC, DOJ on mortgage securities fraud

  • $855Min toxic mortgage securities sold by Bank of America, according to the SEC and Department of Justice, in a civil suit against BofA for allegedly defrauding their investors. The suit alleges the megabank knowingly sold investors on mortgage securities they claimed were backed by high-quality loans, while they actually knew the loans in question were riddled with issues creating an increased propensity for failure. source
20:31 // 1 year ago
September 29, 2012

Bank of America dishes out big settlement on Merrill Lynch allegations

$2.43 bil. the cost of a legal settlement between Bank of America and shareholders source

This time the piper pays: A group of shareholders and investors alleged that Bank of America misled them in 2008 regarding the institutional health of Merrill Lynch, prior to its acquisition by BofA, hiding huge losses mounting on the floundering bank’s record. This is the largest class-action settlement to emerge from the financial crisis, and there’s a reason if companies seem so eager to settle – doing so can limit further action that might be taken by attorneys general, in this case New York AG Eric Schneiderman.

15:56 // 1 year ago
June 29, 2012
It is the worst deal in the history of American finance. Hands down.
UNC-Charlotte finance professor Tony Plath • Discussing Bank of America’s buyout of Countrywide four years ago, which made the company one of the biggest mortgage lenders in the world just as the market was going bust. Gotta love the timing. The company has lost roughly $40 billion (and counting) on the deal, and its stock price, which once neared $40, closed at roughly $8 at the end of Friday trading. But on the other hand, perhaps it wasn’t all bad for the economy — see, the deal put Countrywide in the hands of another company which was slightly less likely to fail. While the deal was clearly a bad move for Bank of America, the economy might not have recovered as easily if Countrywide totally crashed and burned.
21:23 // 2 years ago
April 19, 2012

Bank of America has solid quarter despite massive charge

  • $653M the size of the profit Bank of America had this quarter, which beat investor estimates
  • $2.05B the size of the profit BofA had in the same quarter a year ago; but wait, isn’t that a decline?
  • $4.8B the size of an accounting charge on the value of the bank’s debt, causing lower profits source

» In other words … If you take out the charge, their profits were nearly $5.5 billion this quarter. This total beat the street’s estimate by a wide margin — a reported profit of 31 cents per share, versus what investors thought would be a profit of 12 cents per share. As a result, the stock made a fairly big leap this morning, surging 6 percent in pre-market trading.

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10:14 // 2 years ago
December 30, 2011
On behalf of American consumers, we’re concerned about Verizon’s actions and are looking into the matter.
The FCC, in a statement saying they’ll look into Verizon’s controversial new $2 bill-pay convenience fee. 2011 has not been a good year for nickel-and-dimers — between Bank of America and Ticketmaster, “convenience charges” are starting to look like something consumers will not stand for, and will complain about loudly on the internet. On a side note, has had a bit of a banner year.
14:42 // 2 years ago
December 22, 2011

Defining “massive” to the masses

emptybrackets says: it seems a little disingenuous to me to call 335m “massive” considering the scale countrywide and boa operate on

» SFB says: Well, considering it’s the “largest residential fair-lending settlement in history,” as the source article puts it, there’s not another settlement of this type bigger than this one, so that’s why we called it a “massive” settlement. And let’s face it, $335 million is not something the average person has lying around. — Ernie @ SFB

1:20 // 2 years ago

Countrywide will pay massive settlement over subprime crisis

  • $335 million settlement over discrimination charges source

» They allegedly steered minorities towards bad mortgages. The company, something of the focal point of the subprime housing scandal, now has to face the music. Bank of America, the parent of Countrywide Financial, had to settle claims from before it purchased the company, a four-year period during the housing boom when loans were handed out very easily. In the case of Countrywide, however, there is evidence that while white homeowners got offered normal mortgage, black or Latino homeowners of similar stature received a subprime mortgage instead, meaning that they were given higher interest rates and unfavorable terms for loans, making it easier to default. As part of the settlement with the Justice Department, the company denied the charges, while Bank of America distanced itself from the housing-boom-era actions

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1:03 // 2 years ago
December 1, 2011

Massachusetts Attorney General Martha Coakley moves on foreclosures

  • 5 major banks sued by Massachusetts over unlawful home foreclosures source

» The deluge of home foreclosures that the U.S. has suffered since the financial crisis has been a crippling blow to the general economy, land value rates in high-foreclosure areas, and most of all the families who’ve found themselves unceremoniously cast out. A notable amount of these foreclosures appear to have been fraudulently engineered, rife with examples of flat-out false documentation, as well as “robo-signing,” a practice in which foreclosure documents are fast-tracked with (in some cases) fraudulent signatures and without the signee ever having read them. This was the impetus for Massachusetts Attorney General Martha Coakley filing suit against five major banks — BofA, JPMorgan Chase, Wells Fargo, Citi, and Ally Financial.

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14:36 // 2 years ago