BAC-WT - Bank of America Warrants

[PlanMaestro]

Might be interesting to run a poll on the litigation cost for BAC.

 

With an diverse and independent group that includes some informed people but also some skeptics, we might get some "wisdom of the crowds" instead of the variations of Mr Market.

[onyx1]

The grand total is about $63 billion as the maximum and this assumes that this number is over on top of the $14 billion or so that has already been reserved.

 

Thanks for these posts vinod1.  What did you assume about undisclosed Litigation reserves?

 

I did not assume any number for the undisclosed litigation reserves. I remember seeing $14 billion number somewhere as what has been reserved for Warranties & Reps.

 

Vinod

 

BAC has litigation reserves and I think you have to incorporate them. 

 

Special call, BM: "In addition to our credit reserves, we have approximately $18 billion [Note: $16bln now at end of Q3] in reserves in our mortgage business for rep-and-warrants, and we have additional reserves for litigation matters.

 

They don't disclose the number to avoid tipping their hand.  But if we here can make reasoned estimates certainly BAC can too with much better information.  And if they can make estimates, it is a safe assumption that they have set up a reserve to match their expected losses.  This would apply to the FHFA, AIG and ML acquisition lawsuits.

[ERICOPOLY]

But if we here can make reasoned estimates certainly BAC can too with much better information.  And if they can make estimates, why should we assuming that they have not set up a reserve to match their expected losses?  This would apply to the FHFA, AIG and ML acquisition lawsuits.

 

Now I'll say something skeptical:

 

One year ago we could make reasoned estimates that they would have R&W exposure in excess of their reserves at the time.  Then all of a sudden they increase the reserve by $14b in one quarter.

 

The same could happen with their litigation reserve -- it could be some relatively small percentage only to grow by several multiples in a single (future) quarter.

 

 

 

 

[onyx1]

The same could happen with their litigation reserve -- it could be some relatively small percentage only to grow by several multiples in a single (future) quarter.

 

Agreed.  BAC has made it clear they review inputs and refine and adjust these reserves as more information is known each quarter.  In some cases,  they have made no estimate at all as they deem the losses improbable or impossible to estimate.  If that changes, the litigation reserve would grow.

[twacowfca]

Aswath Damodaran says CITI and Morgan Stanley will require five years of projected earnings to get their Tier I capital up to the levels needed to support the payment of substantial dividends.

 

Onyx,  how does BAC compare to CITI and MS in their capital ratios?

 

Aswath is UCLA educated, so he must be correct.  How do I start a shareholder lawsuit against Citigroup?  :D

 

Here is what Citi says:

 

Continue to expect to begin returning capital to shareholders in 2012 and operate in a Tier 1 Common ratio range of 8-9% under Basel III by end of 2012

 

See page 23

 

http://www.citigroup.com/citi/fin/data/p111020a.pdf

 

Mike Mayo said that the most expensive writing ever, $183,000.00 per word was the rate for what the auditor's report for a bank that shall remain unnamed cost.  In his opinion, the reason it was so expensive is that it cost that much to gloss over and obscure their real condition that even their managers and auditors don't understand.

 

I'm interested in hearing about the value of Mike Mayo.  Apparently he was a bull on Lehman in 2007.  Is that accurate?

 

From what I can find, he accuses Citigroup of overstating their DTA by $10b.

 

Yeah, he talked about his being slow to downgrade Lehman as the worst mistake of his career.  He continued to believe the BS they were feeding him, until he finally caught them in a lie.  Then, he quickly put out a sell on them as they were near the brink, and that may have been the straw that broke the camel's back and pushed them over into their death slide.

 

“If you tell a lie big enough and keep repeating it, people will eventually come to believe it."

 

- Joseph Goebbels

 

Is Citigroup telling a huge whopper of a lie? 

 

According to Mayo Citigroup is overstating the DTA by $10b.  In doing so, they report Tier 1 ratio at 11.7% under Basel I. 

 

Mike Mayo thinks this is fraud.

 

What is the motive in this fraud?  What if they only reported 10% under Basel I?  The horrors, the horrors.  Look, they are reporting a number higher than most of their rivals even if you DISALLOW that $10b in DTA.

 

I didn't mean to discredit him for Lehman -- everybody makes a mistake.  Citigroup no longer lets him participate on conference calls.  I've read those old transcripts with Mayo asking questions and they indeed seemed disruptive in tone -- some sort of axe to grind.  I understand that he's been against Citigroup since 2001 or so, and that's fine given how Citigroup ended up -- however the new management probably doesn't appreciate being painted with the same brush given the changes they instituted.  Mayo is biting at their ankles, or so it sounds to me.

 

$10b of DTAs means sh*t to Citigroup.  They are reporting Basel I Tier 1 ratio of 11.7%.  Why make a lie that you don't need to make?

 

Why indeed?  Getting shut out of conference calls was the least of what happened to him.  He and his family were put under nearly constant surveillance. Nothing in any way threatening, of course.  Just intense staring from a proper distance.  If you want more details on CITI, see my reply to ONYX.

[vinod1]

The same could happen with their litigation reserve -- it could be some relatively small percentage only to grow by several multiples in a single (future) quarter.

 

Agreed.  BAC has made it clear they review inputs and refine and adjust these reserves as more information is known each quarter.  In some cases,  they have made no estimate at all as they deem the losses improbable or impossible to estimate.  If that changes, the litigation reserve would grow.

 

With BAC, I would not worry too much about +/- $10 billion in estimates especially if they add more to MOS.  :)

 

You have to remember that this is at this stage a self graded exam, where the penalty for being too strict with yourself is instant death (or its close parallel - severe dilution). BAC has good cover in GAAP rules for estimating contingent liabilities. It is very difficult to find fault with whatever their estimate was for this. So they refine the number gradually to catch up with the PTPP flow and without unduly hurting their capital ratios. This is what I would do and this is what I expect BAC to do as well.

 

Vinod

 

 

[twacowfca]

The same could happen with their litigation reserve -- it could be some relatively small percentage only to grow by several multiples in a single (future) quarter.

 

Agreed.  BAC has made it clear they review inputs and refine and adjust these reserves as more information is known each quarter.  In some cases,  they have made no estimate at all as they deem the losses improbable or impossible to estimate.  If that changes, the litigation reserve would grow.

 

With BAC, I would not worry too much about +/- $10 billion in estimates especially if they add more to MOS.  :)

 

You have to remember that this is at this stage a self graded exam, where the penalty for being too strict with yourself is instant death (or its close parallel - severe dilution). BAC has good cover in GAAP rules for estimating contingent liabilities. It is very difficult to find fault with whatever their estimate was for this. So they refine the number gradually to catch up with the PTPP flow and without unduly hurting their capital ratios. This is what I would do and this is what I expect BAC to do as well.

 

Vinod

 

 

 

That sounds GAAPishly correct.  The truth would be to say: we don't have a clue.

[ERICOPOLY]

Aswath Damodaran says CITI and Morgan Stanley will require five years of projected earnings to get their Tier I capital up to the levels needed to support the payment of substantial dividends.

 

Onyx,  how does BAC compare to CITI and MS in their capital ratios?

 

Aswath is UCLA educated, so he must be correct.  How do I start a shareholder lawsuit against Citigroup?  :D

 

Here is what Citi says:

 

Continue to expect to begin returning capital to shareholders in 2012 and operate in a Tier 1 Common ratio range of 8-9% under Basel III by end of 2012

 

See page 23

 

http://www.citigroup.com/citi/fin/data/p111020a.pdf

 

Mike Mayo said that the most expensive writing ever, $183,000.00 per word was the rate for what the auditor's report for a bank that shall remain unnamed cost.  In his opinion, the reason it was so expensive is that it cost that much to gloss over and obscure their real condition that even their managers and auditors don't understand.

 

I'm interested in hearing about the value of Mike Mayo.  Apparently he was a bull on Lehman in 2007.  Is that accurate?

 

From what I can find, he accuses Citigroup of overstating their DTA by $10b.

 

Yeah, he talked about his being slow to downgrade Lehman as the worst mistake of his career.  He continued to believe the BS they were feeding him, until he finally caught them in a lie.  Then, he quickly put out a sell on them as they were near the brink, and that may have been the straw that broke the camel's back and pushed them over into their death slide.

 

“If you tell a lie big enough and keep repeating it, people will eventually come to believe it."

 

- Joseph Goebbels

 

Is Citigroup telling a huge whopper of a lie? 

 

According to Mayo Citigroup is overstating the DTA by $10b.  In doing so, they report Tier 1 ratio at 11.7% under Basel I. 

 

Mike Mayo thinks this is fraud.

 

What is the motive in this fraud?  What if they only reported 10% under Basel I?  The horrors, the horrors.  Look, they are reporting a number higher than most of their rivals even if you DISALLOW that $10b in DTA.

 

I didn't mean to discredit him for Lehman -- everybody makes a mistake.  Citigroup no longer lets him participate on conference calls.  I've read those old transcripts with Mayo asking questions and they indeed seemed disruptive in tone -- some sort of axe to grind.  I understand that he's been against Citigroup since 2001 or so, and that's fine given how Citigroup ended up -- however the new management probably doesn't appreciate being painted with the same brush given the changes they instituted.  Mayo is biting at their ankles, or so it sounds to me.

 

$10b of DTAs means sh*t to Citigroup.  They are reporting Basel I Tier 1 ratio of 11.7%.  Why make a lie that you don't need to make?

 

Why indeed?  Getting shut out of conference calls was the least of what happened to him.  He and his family were put under nearly constant surveillance. Nothing in any way threatening, of course.  Just intense staring from a proper distance.  If you want more details on CITI, see my reply to ONYX.

 

How far back did that happen?

 

What do you make of the following report that Mayo is not as negative on Citi and in fact expects them to earn 1% ROA?  He was given a private meeting with Pandit and Gerspach after being shut out for two years.

 

http://www.cnbc.com/id/39501351/Halftime_Can_Mike_Mayo_s_Big_Citi_Meeting_Lift_Bank_Stocks

[twacowfca]

Aswath Damodaran says CITI and Morgan Stanley will require five years of projected earnings to get their Tier I capital up to the levels needed to support the payment of substantial dividends.

 

Onyx,  how does BAC compare to CITI and MS in their capital ratios?

 

Aswath is UCLA educated, so he must be correct.  How do I start a shareholder lawsuit against Citigroup?  :D

 

Here is what Citi says:

 

Continue to expect to begin returning capital to shareholders in 2012 and operate in a Tier 1 Common ratio range of 8-9% under Basel III by end of 2012

 

See page 23

 

http://www.citigroup.com/citi/fin/data/p111020a.pdf

 

Mike Mayo said that the most expensive writing ever, $183,000.00 per word was the rate for what the auditor's report for a bank that shall remain unnamed cost.  In his opinion, the reason it was so expensive is that it cost that much to gloss over and obscure their real condition that even their managers and auditors don't understand.

 

I'm interested in hearing about the value of Mike Mayo.  Apparently he was a bull on Lehman in 2007.  Is that accurate?

 

From what I can find, he accuses Citigroup of overstating their DTA by $10b.

 

Yeah, he talked about his being slow to downgrade Lehman as the worst mistake of his career.  He continued to believe the BS they were feeding him, until he finally caught them in a lie.  Then, he quickly put out a sell on them as they were near the brink, and that may have been the straw that broke the camel's back and pushed them over into their death slide.

 

“If you tell a lie big enough and keep repeating it, people will eventually come to believe it."

 

- Joseph Goebbels

 

Is Citigroup telling a huge whopper of a lie? 

 

According to Mayo Citigroup is overstating the DTA by $10b.  In doing so, they report Tier 1 ratio at 11.7% under Basel I. 

 

Mike Mayo thinks this is fraud.

 

What is the motive in this fraud?  What if they only reported 10% under Basel I?  The horrors, the horrors.  Look, they are reporting a number higher than most of their rivals even if you DISALLOW that $10b in DTA.

 

I didn't mean to discredit him for Lehman -- everybody makes a mistake.  Citigroup no longer lets him participate on conference calls.  I've read those old transcripts with Mayo asking questions and they indeed seemed disruptive in tone -- some sort of axe to grind.  I understand that he's been against Citigroup since 2001 or so, and that's fine given how Citigroup ended up -- however the new management probably doesn't appreciate being painted with the same brush given the changes they instituted.  Mayo is biting at their ankles, or so it sounds to me.

 

$10b of DTAs means sh*t to Citigroup.  They are reporting Basel I Tier 1 ratio of 11.7%.  Why make a lie that you don't need to make?

 

Why indeed?  Getting shut out of conference calls was the least of what happened to him.  He and his family were put under nearly constant surveillance. Nothing in any way threatening, of course.  Just intense staring from a proper distance.  If you want more details on CITI, see my reply to ONYX.

 

How far back did that happen?

 

What do you make of the following report that Mayo is not as negative on Citi and in fact expects them to earn 1% ROA?  He was given a private meeting with Pandit and Gerspach after being shut out for two years.

 

http://www.cnbc.com/id/39501351/Halftime_Can_Mike_Mayo_s_Big_Citi_Meeting_Lift_Bank_Stocks

 

 

 

Did I miss something?  That report's from 2010, and it doesn't say anything about what he expected them to earn then.  It says he thought at that time that their targeted ROA, 125BP was too high and that he thought it should be lower, 100BP.  What's more important is what it didn't say: nothing about the mystery meat on their balance sheet.

[onyx1]

The same could happen with their litigation reserve -- it could be some relatively small percentage only to grow by several multiples in a single (future) quarter.

 

Agreed.  BAC has made it clear they review inputs and refine and adjust these reserves as more information is known each quarter.  In some cases,  they have made no estimate at all as they deem the losses improbable or impossible to estimate.  If that changes, the litigation reserve would grow.

 

With BAC, I would not worry too much about +/- $10 billion in estimates especially if they add more to MOS.  :)

 

You have to remember that this is at this stage a self graded exam, where the penalty for being too strict with yourself is instant death (or its close parallel - severe dilution). BAC has good cover in GAAP rules for estimating contingent liabilities. It is very difficult to find fault with whatever their estimate was for this. So they refine the number gradually to catch up with the PTPP flow and without unduly hurting their capital ratios. This is what I would do and this is what I expect BAC to do as well.

 

Vinod

 

 

 

See this document for some context of securities class action settlements:

 

http://www.cornerstone.com/files/News/029b31a7-ff84-4000-b1ff-d177014ced27/Presentation/NewsAttachment/fd13e1e4-5564-4d46-86a3-882f232147a9/Cornerstone_Research_Settlements_2010_Analysis.pdf

 

Page 12 shows that Credit-Crisis-Related settlements in 2010 were around 2%-3% of estimated damages.

 

 

[value-is-what-you-get]

Very interesting onyx1 - thanks for posting.  Looks like there's a case to be made for proper legal counsel selection!  1.2% low end to 3.4% high end.  Quite the range.

[ERICOPOLY]

Did I miss something?  That report's from 2010, and it doesn't say anything about what he expected them to earn then.  It says he thought at that time that their targeted ROA, 125BP was too high and that he thought it should be lower, 100BP.  What's more important is what it didn't say: nothing about the mystery meat on their balance sheet.

 

He thinks it should be 100bps but you reckon even still he doesn't expect them to earn that?  Or are you taking exception to the choice of words "expects" instead of what I might have used instead "can earn"?

 

Which cut of mystery meat are you thinking is going to sink the ship?  Here is the CitiHolding mystery meat locker as it stands today:

 

see page 7

 

http://www.citigroup.com/citi/fin/data/p111020a.pdf?ieNocache=737

 

Are you talking about the Special Asset Pool which houses $45 billion in assets?  This number has fallen 53% over the past year, where are the huge losses?  Isn't this the place where they have been hiding all of their losses according to the skeptics?

 

Here are the numbers for Special Asset Pool size over the past 3 years:

2008 Q3:  $239b

2009 Q3:  $163b

2010 Q3:    $95b

2011 Q3:    $45b

 

 

 

 

 

 

 

 

[onyx1]

Getting back to BAC, and focusing on the bigger picture.  It may take 2 years, 3 years, or even 5 years of (mostly pre-tax) earnings to build up to Basel III capital requirements and pay legal settlements over and above that which is current reserved.  Even if it takes 5 years, you end up with very well capitalized mega bank with $1.8 trl in assets earning 1%.  Even at modest 10X thats $180bln or over 3X todays market value.  Who wouldn't be satisfied with a triple in 5 years?

[benchmark]

Getting back to BAC, and focusing on the bigger picture.  It may take 2 years, 3 years, or even 5 years of (mostly pre-tax) earnings to build up to Basel III capital requirements and pay legal settlements over and above that which is current reserved.  Even if it takes 5 years, you end up with very well capitalized mega bank with $1.8 trl in assets earning 1%.  Even at modest 10X thats $180bln or over 3X todays market value.  Who wouldn't be satisfied with a triple in 5 years?

 

Agreed. I'm also looking at common and 2014 10 leap. Now that common has dropped below 5, i think it will probably go lower

[alertmeipp]

The market is not doing any valuation right now.

 

I think ppl are getting pissed and just sell and move on.

 

As usual, I am fully invested and all I can do is suck it up at the moment.

[racemize]

The market is not doing any valuation right now.

 

I think ppl are getting pissed and just sell and move on.

 

As usual, I am fully invested and all I can do is suck it up at the moment.

 

I'm pretty much with you there--I'm thinking of gathering up some cash reserves as the paychecks come in, but I keep finding things I like!

[tombgrt]

The market is not doing any valuation right now.

 

I think ppl are getting pissed and just sell and move on.

 

As usual, I am fully invested and all I can do is suck it up at the moment.

 

I agree. The fear caused by the recency effect and uncertainty is enormous. Take BAC. How long was the stock priced under $5 in 08-09? Not even a month! Now the bank is in much better shape, dealing with the issues and getting more focused, .. How exactly is it going to get killed from major contagion from Europe? How is going to happen for C? Somehow Mr. Market thinks these banks deserve equally low or even lower valuations than their European peers that are often undercapitalized and have real threat of contagion.

 

 

And not buying BAC now because the $5 support is "broken"? I'd rather not gamble on wether an insanely cheap stock will sell off or not because of certain policies or because my technical chart says so, and just buy the damn thing. Maybe one can wait until he is certain the $3.xx bottom from 2009 will hold. After all, you were right from $15/10/8/6 to $5...

[Uccmal]

The market is not doing any valuation right now.

 

I think ppl are getting pissed and just sell and move on.

 

As usual, I am fully invested and all I can do is suck it up at the moment.

 

I'm pretty much with you there--I'm thinking of gathering up some cash reserves as the paychecks come in, but I keep finding things I like!

 

 

FWIW,  I think were in the midst of a robust tax loss selling season this year.  All of my large caps that are significantly lower this year are getting hammered some more.  Wfc, jpm, bac, and bby, which were already down alot have been shit kicked again.  Ge which has stayed in a range all year is still in that range.  There are no fundamental changes in the macro since January, April, or August.  In the meantime everyone of these companies is better off than a year ago.

 

 

 

 

 

[Uccmal]

The market is not doing any valuation right now.

 

I think ppl are getting pissed and just sell and move on.

 

As usual, I am fully invested and all I can do is suck it up at the moment.

 

I agree. The fear caused by the recency effect and uncertainty is enormous. Take BAC. How long was the stock priced under $5 in 08-09? Not even a month! Now the bank is in much better shape, dealing with the issues and getting more focused, .. How exactly is it going to get killed from major

contagion from Europe? How is going to happen for C? Somehow these banks Mr. Market thinks

these banks deserve equally low or even lower valuations than their European peers that are often undercapitalized and have real threat of contagion.

 

 

And not buying BAC now because the $5 support is "broken"? I'd rather not gamble on wether an insanely cheap stock will sell off or not because of certain policies or because my technical chart says so, and just buy the damn thing. Maybe one can wait until he is certain the $3.xx bottom from 2009 will hold. After all, you were right from $15/10/8/6 to $5...

 

Amen Brother

 

[tombgrt]

The market is not doing any valuation right now.

 

I think ppl are getting pissed and just sell and move on.

 

As usual, I am fully invested and all I can do is suck it up at the moment.

 

I'm pretty much with you there--I'm thinking of gathering up some cash reserves as the paychecks come in, but I keep finding things I like!

 

 

FWIW,  I think were in the midst of a robust tax loss selling season this year.  All of my large caps that are significantly lower this year are getting hammered some more.  Wfc, jpm, bac, and bby, which were already down alot have been shit kicked again.  Ge which has stayed in a range all year is still in that range.  There are no fundamental changes in the macro since January, April, or August.  In the meantime everyone of these companies is better off than a year ago.

 

I was wondering about that too. I've read somewhere that the impact from tax loss selling is actually a lot lower in a down market because there aren't much profits to offset. Makes sense. On the other hand this could just give people a good excuse to sell their biggest losers 'for free' so to speak. Making it easier to do something that can be emotionally difficult (selling big losers). They might also know they are acting irrational but are supported by rational tax decisions which makes it easier to cave in to the fear, maybe thinking they can get back in at better prices in January/February.

 

Just thinking out loud here. Zero experience with it as I live in Europe. Insight would be appreciated, not that it matters for the valuation of BAC or any other company.

[rranjan]

actually the way this year played out enhanced tax loss selling. remember the first half was strong and lots of things went up. Also, high quality non financial stocks have done reasonably well this year, as have high quality bonds. looking at the tape today all the losers were down today. rimm fslr aig c bac glw gnw. don't know how long this will go on.

 

I think it is mainly tax loss issue when we are talking about already beaten up stocks going further down during the end of year. I don't make any investment decision based on these guesses though. I simply buy when I think they are cheap and sell when they reach near full value. I am finding plenty of cheap stuff right now so almost fully invested. I have been selling some in rally and then again buying back to reduce average cost of some holdings but more or less fully invested.

 

 

[vinod1]

The same could happen with their litigation reserve -- it could be some relatively small percentage only to grow by several multiples in a single (future) quarter.

 

Agreed.  BAC has made it clear they review inputs and refine and adjust these reserves as more information is known each quarter.  In some cases,  they have made no estimate at all as they deem the losses improbable or impossible to estimate.  If that changes, the litigation reserve would grow.

 

With BAC, I would not worry too much about +/- $10 billion in estimates especially if they add more to MOS.  :)

 

You have to remember that this is at this stage a self graded exam, where the penalty for being too strict with yourself is instant death (or its close parallel - severe dilution). BAC has good cover in GAAP rules for estimating contingent liabilities. It is very difficult to find fault with whatever their estimate was for this. So they refine the number gradually to catch up with the PTPP flow and without unduly hurting their capital ratios. This is what I would do and this is what I expect BAC to do as well.

 

Vinod

 

 

 

See this document for some context of securities class action settlements:

 

http://www.cornerstone.com/files/News/029b31a7-ff84-4000-b1ff-d177014ced27/Presentation/NewsAttachment/fd13e1e4-5564-4d46-86a3-882f232147a9/Cornerstone_Research_Settlements_2010_Analysis.pdf

 

Page 12 shows that Credit-Crisis-Related settlements in 2010 were around 2%-3% of estimated damages.

 

Thanks! It is good to know that the settlement % are rather low.

[twacowfca]

Getting back to BAC, and focusing on the bigger picture.  It may take 2 years, 3 years, or even 5 years of (mostly pre-tax) earnings to build up to Basel III capital requirements and pay legal settlements over and above that which is current reserved.  Even if it takes 5 years, you end up with very well capitalized mega bank with $1.8 trl in assets earning 1%.  Even at modest 10X thats $180bln or over 3X todays market value.  Who wouldn't be satisfied with a triple in 5 years?

 

 

Don't disagree.  But let's not pretend to analyze a maze with hidden chambers that the very best bank analysts can't navigate.

 

Let's just say: these are big banks, probably too big to fail.  They've been in the dumps before and come back.  I know there's a pony in there somewhere.  I'm willing to wait patiently until the pony comes out so I can take a ride.  8)

[txlaw]

Wow, quite amazing to see BAC trading at below $5 today.

 

Just read a blog post about WEB's investment in BofA: http://blogs.wsj.com/deals/2011/12/19/warren-buffett-is-1-5-billion-underwater-on-his-bank-of-america-stock/

 

I argued when the preferred deal was done that it was at a below market rate because WEB believed that the common was worth at least $7.14 per share and probably substantially more than that.  If that is correct, then WEB ought to be buying at these levels, unless he thinks things have changed materially such that the IV of BAC is now substantially below the $7.14 figure.

 

Or I could have just been dead wrong.  It's possible that WEB really was interested only in an asymmetric bet that would be covered no matter what but that would have a lottery ticket-like optionality. 

 

I've been adding to my BAC-WT stake over the last few months, but it's been pretty painful to watch.

[value-is-what-you-get]

Yeah I read that too - guy doesn't even have his facts straight.  Says BAC has to buy out WEB at a 5% premium "at any time" which sounds like WEB can call his money back tomorrow when in fact the preferreds he bought are locked in for 5 years and the premium is only triggered if and when BAC wants to by back "at any time".  I guess I'm just spoiled by the high quality of fact-based information I get from this board as opposed to the opinion shaping stuff the WSJ et al sees fit to hang their names on from time to time.  I like this kind of shoddy reporting whispering sweet nothings in Mr. Market's ear though!