BAC-WT - Bank of America Warrants

[ASTA]

I just chicken'd out as I have a nice gain and I am already 95% invested and just don't like the market going up and up :D

Will probably buy LRE and just sleep better at night if the market crashes. still think its a great stock but hedging has not worked for me before and cash is always nice.

Plus I had a little goal of selling once it started to pay out dividend's.

[vinod1]

AR out http://media.corporate-ir.net/media_files/IROL/71/71595/AR2013.pdf

 

As usual, Moynihan does not say much, this is all he has to say about the business:

 

As we look ahead, we will continue to pursue the same strategy that has served

us well these past several years — a strategy to make our company more

straightforward; a strategy to serve the core financial needs of our customers;

a strategy to manage risk, maintain strong capital and liquidity, and to operate

efficiently and reduce costs. This is what will drive results and progress.

 

Vinod

 

[fareastwarriors]

Bank of America Should Face SEC Mortgage Suit, Judge Says

 

 

Bank of America Corp. should face U.S. Securities and Exchange Commission claims over $855 million in mortgage-backed securities, said a judge who last week nudged the lender toward victory in a Justice Department suit over the same instruments by advising that it be thrown out.

 

Bank of America’s request to dismiss the SEC case should be denied because the regulator adequately laid out its claims that the bank didn’t disclose in offering papers that most of the pooled mortgages for the securities were bought wholesale from third-party brokers, U.S. Magistrate Judge David Cayer in Charlotte, North Carolina, said yesterday.

 

 

 

http://www.bloomberg.com/news/2014-04-01/bank-of-america-should-face-sec-mortgage-lawsuit-judge-says.html

[fareastwarriors]

Bank of America In Settlement Talks Over Credit Card Practices

 

 

Bank Discussing At Least $800 Million Settlement, Say People Familiar

 

 

http://online.wsj.com/news/articles/SB10001424052702303847804579479780968744404?mod=WSJ_LatestHeadlines&mg=reno64-wsj

[fareastwarriors]

BofA’s Moynihan Among Underpaid CEOs, Crystal Study Says

 

 

http://www.bloomberg.com/news/2014-04-04/bofa-s-moynihan-among-underpaid-ceos-crystal-study-says.html

[fareastwarriors]

Bank of America, QBE to settle insurance lawsuit for $228 million

 

 

 

http://www.reuters.com/article/2014/04/07/us-bankofamerica-settlement-idUSBREA361FJ20140407

[fareastwarriors]

 

Big Banks to Get Order To Raise Capital Level

 

Nation's Biggest Banks Would Have to Raise $68 Billion in Additional Capital

 

 

 

 

 

http://online.wsj.com/news/articles/SB10001424052702303456104579489643124383708?mod=WSJ_hp_LEFTWhatsNewsCollection&mg=reno64-wsj

[ourkid8]

Additional cost cuts:

 

http://finance.yahoo.com/news/bank-america-cut-3-000-133641010.html

 

NEW YORK (AP) -- Bank of America says it's cutting about 3,000 jobs overseas as part of ongoing reviews of its global operations.

 

The jobs are located in Costa Rica, the Philippines and Mexico.

 

The Charlotte, N.C.-based company plans to close sites in those countries over the next nine to 12 months.

 

Bank of America Corp. spokesman Mark Pipitone says the cuts will have no effect on Bank of America Merrill Lynch, its global banking and markets business, which serves commercial, corporate and institutional clients in Latin America.

 

[fareastwarriors]

BofA Sets $783 Million Accord on Card Marketing Dispute

 

 

 

http://www.bloomberg.com/news/2014-04-09/bofa-sets-783-million-accord-to-end-u-s-consumer-card-dispute.html

[Luke 532]

I just chicken'd out as I have a nice gain and I am already 95% invested and just don't like the market going up and up :D

Will probably buy LRE and just sleep better at night if the market crashes. still think its a great stock but hedging has not worked for me before and cash is always nice.

Plus I had a little goal of selling once it started to pay out dividend's.

 

ASTA, keep in mind the strike price adjustment based on dividends exceeding $0.01/qtr (not to mention the shares per warrant adjustment).  That is one of the highly favorable characteristics of the warrants and I would imagine they will get more attention from the market as the dividend rate increases.

[fareastwarriors]

Mega-Banks Might Need to Hold More Capital

 

 

 

http://www.nytimes.com/aponline/2014/04/15/us/politics/ap-us-yellen-banks.html?action=click&contentCollection=Business%20Day&region=Footer&module=MoreInSection&pgtype=Blogs

[ERICOPOLY]

Mega-Banks Might Need to Hold More Capital

 

 

 

http://www.nytimes.com/aponline/2014/04/15/us/politics/ap-us-yellen-banks.html?action=click&contentCollection=Business%20Day&region=Footer&module=MoreInSection&pgtype=Blogs

 

 

So... they will formalize the higher unofficial capital rules already in place?  (aka:  The Fed Stress Tests)

[racemize]

Mega-Banks Might Need to Hold More Capital

 

 

 

http://www.nytimes.com/aponline/2014/04/15/us/politics/ap-us-yellen-banks.html?action=click&contentCollection=Business%20Day&region=Footer&module=MoreInSection&pgtype=Blogs

 

 

So... they will formalize the higher unofficial capital rules already in place?  (aka:  The Fed Stress Tests)

 

Or, they will increase it, and then add even more by stressing those new regulations.

[ERICOPOLY]

Mega-Banks Might Need to Hold More Capital

 

 

 

http://www.nytimes.com/aponline/2014/04/15/us/politics/ap-us-yellen-banks.html?action=click&contentCollection=Business%20Day&region=Footer&module=MoreInSection&pgtype=Blogs

 

 

So... they will formalize the higher unofficial capital rules already in place?  (aka:  The Fed Stress Tests)

 

Or, they will increase it, and then add even more by stressing those new regulations.

 

A good way to go about it would be to first get the banks ready (via stress tests) and then hike the "official" capital rules.  That way, nobody is in a serious shortfall when new official rules are proposed.  So that fits the current pattern, anyway. 

 

Would it change anything at all if BAC were hiked to 10% B3?  Not really.  The Fed already holds them to that level anyhow via the stress tests.

 

[racemize]

Mega-Banks Might Need to Hold More Capital

 

 

 

http://www.nytimes.com/aponline/2014/04/15/us/politics/ap-us-yellen-banks.html?action=click&contentCollection=Business%20Day&region=Footer&module=MoreInSection&pgtype=Blogs

 

 

So... they will formalize the higher unofficial capital rules already in place?  (aka:  The Fed Stress Tests)

 

Or, they will increase it, and then add even more by stressing those new regulations.

 

A good way to go about it would be to first get the banks ready (via stress tests) and then hike the "official" capital rules.  That way, nobody is in a serious shortfall when new official rules are proposed.  So that fits the current pattern, anyway. 

 

Would it change anything at all if BAC were hiked to 10% B3?  Not really.  The Fed already holds them to that level anyhow via the stress tests.

 

I'm just worried they hike to 10% and then require that the they be above 10% on the severe stress scenarios as well (e.g., making it effectively 12% or something along those lines).

[ERICOPOLY]

Mega-Banks Might Need to Hold More Capital

 

 

 

http://www.nytimes.com/aponline/2014/04/15/us/politics/ap-us-yellen-banks.html?action=click&contentCollection=Business%20Day&region=Footer&module=MoreInSection&pgtype=Blogs

 

 

So... they will formalize the higher unofficial capital rules already in place?  (aka:  The Fed Stress Tests)

 

Or, they will increase it, and then add even more by stressing those new regulations.

 

A good way to go about it would be to first get the banks ready (via stress tests) and then hike the "official" capital rules.  That way, nobody is in a serious shortfall when new official rules are proposed.  So that fits the current pattern, anyway. 

 

Would it change anything at all if BAC were hiked to 10% B3?  Not really.  The Fed already holds them to that level anyhow via the stress tests.

 

I'm just worried they hike to 10% and then require that the they be above 10% on the severe stress scenarios as well (e.g., making it effectively 12% or something along those lines).

 

They might even be at 11% already (unofficially) -- don't they get that far by the end of this year roughly if the economy keeps on plodding along?  So 12% isn't that much further.

[Daytripper]

Warren buffet's Invisible Top-Holding - Bank of America

 

http://finance.yahoo.com/news/warren-buffetts-invisible-top-holding-222133336.html

[Liberty]

http://newsroom.bankofamerica.com/press-releases/corporate-and-financial-news/bank-america-reports-first-quarter-2014-net-loss-276-mil

[mankap]

Every quarter I think that next qtr. litigation cost will drop but then something else shows up. I am hoping again that next qtr, we will see a big drop in litigation cost.

[ERICOPOLY]

In the last 10-Q they talked about potentially being under-reserved for legal issues.  Somewhere in the realm of $5b or $6b.

 

So now that they've hit the $6b number in this quarter alone, I'm interested in what the next 10-Q says on the topic.

[ERICOPOLY]

Here is the quote:

 

Bank of America Corp., the second-biggest U.S. lender, disclosed new probes into its mortgage and foreign-exchange businesses and boosted an estimate of potential legal losses by 20 percent to $6.1 billion.

 

http://www.bloomberg.com/news/2014-02-25/bofa-discloses-new-probes-amid-surge-in-possible-legal-costs.html

 

And so of course, that means there is only potential for another 100 million now right  ;)  After all, they just reported $6b in Q1.  So that leaves... 100 million.

 

And it's been less than 2 months.

[xazp]

Before I saw the market's reaction, I thought the results were good.  It looks like they earned about 35c/share ex-legal, which puts their normalized earnings at $1.40/year.  That's above what I would have expected. 

 

I haven't listened to the call... apparently they said things that the market doesn't like?  Or the market is reacting to the big legal reserve? 

 

In the last 10-Q they talked about potentially being under-reserved for legal issues.  Somewhere in the realm of $5b or $6b.

 

So now that they've hit the $6b number in this quarter alone, I'm interested in what the next 10-Q says on the topic.

[FCharlie]

BAC repurchased 87 million shares during Q1

 

Dec 31st share count was 10.591 billion

Mar 31st share count was 10.530 billion

 

The net reduction was 61 million shares. Isn't Q1 the quarter with the most issuance for compensation? I was expecting an even smaller net reduction.

 

And, while the $4 billion buyback is weak... Book value & TBV are both up on the quarter, and the share price is down hard.

[ERICOPOLY]

Did Buffett agree to amend the terms of the warrants/preferred deal only under the condition that they do a "big bath" and boost the legal reserve once and for all?  Or is it going to be a continuation of abuse to our trust -- tell us at most another $6.1b, then take a $6b charge, then tell us just another $5b, then another $5b charge, then tell us just $3b more, then $3b charge.

 

I think I know why the stock reaction is negative today.  However, the stock hasn't been this low for like... 48 hours.  So it's hardly new territory if put in recent historical context.

[ERICOPOLY]

It looks like they earned about 35c/share ex-legal, which puts their normalized earnings at $1.40/year.  That's above what I would have expected. 

 

I couldn't quite work out the math on that.  I got that 35 cent number as well... but doesn't that assume something like a 40% tax rate?  Seems too high.