Bank of America to need $34 bln in capital-source

[UpInArms]

Source: Reuters

WASHINGTON, May 5 (Reuters) - Bank of America (BAC.N) has been deemed to need an additional $34 billion in capital, according to the results of a government stress test, a source familiar with the results said on Tuesday.

<snip>

The amount is far higher than published reports had speculated the largest bank might need. It is certain to increase the pressure on Chief Executive Kenneth Lewis, whom shareholders ousted as chairman last week.

<snip>

The $34 billion figure more than triples previously published reports of Bank of America's capital needs.

The bank's shareholders voted to oust Lewis last week as chairman of the board, possibly laying the groundwork for his eventual departure from the company.

The bank has already received $45 billion in capital from the federal government.

Read more: http://www.reuters.com/article/bondsNews/idUSN0552030420090506

[DJ13]

1. $34 billion, no sweat

Do they take credit cards?

[HCE SuiGeneris]

18. Yes, but for them there is no usury rate imposed...

just a pat and a wink and... no sweat. The taxpayers have this one covered ;-o

[Jawja]

36. The taxpayers and their customers.

I know for a fact that BOA has indeed raised Credit Card fees on customers, as I am one of them. However to be fair, they have not raised the interest rate on the balance.

[Amerigo Vespucci]

41. Absolutely not true.

I have a letter from them dated April 2nd, stating their intention as of the June 2009 billing cycle to raise the interest rates on "new and existing purchases, balance transfers and cash advances."

By all means, let's be fair, and let's not give them credit that they don.t deserve.

[OhioChick]

2. BOA outsources a hell of a lot....

Let other countries bail out the bastards. I'm getting pretty damn sick and tired of doing so.

[bluestateguy]

3. Oooh! A "source"!

Doesn't anybody go on the record anymore?

[rpannier]

4. I thought they were getting that money by gouging their c/c holders

[aquart]

5. And if I say no?

Why, exactly, do we need this bank?

[Frank Booth]

24. There's been no indication yet that it will come from taxpayers.

From the article:

It's unclear how Bank of America might raise necessary capital, including whether it does so by selling assets or by issuing more common stock.

The bank has said it may sell its First Republic Bank business. It also could sell some or all of its holdings in China Construction Bank (601939.SS) (0939.HK), China's No.2 lender.

If it is unable to sell enough assets, it might be forced to convert some of the government's preferred shares into common stock. This would dilute existing shareholders, and could leave the government as one of the bank's biggest shareholders. . . . Federal Reserve Chairman Ben Bernanke said on Tuesday that most of the capital-needy banks will be able to raise additional capital through "either issuance of new capital or through conversions and exchanges, or the sales of assets and other measures."

[mbperrin]

26. They got $45 billion from taxpayers already. They need $34 billion.

Their entire market capitalization is only $69 billion.
http://finance.yahoo.com/q?s=bac

We're $10 billion underwater now, assuming all other shareholders are completely zeroed. They have no assets. They have no future without the taxpayers.

Personally, I said pull the plug before they got the first money. They're ill-run and broke, selfish, short sighted and lousy business people. What's to like?

Kiss the $45 billion goodbye and let them go. Better than kissing $79 billion and then letting go.

[Frank Booth]

28. There's enough in government owned preferred shares

to raise the $34 billion simply by converting it to common stock. They're also claiming they can raise it by selling assets or issuing more stock.

Whatever the case, it sounds like the government won't have to give them more money to meet the capital demands -- though I wouldn't be surprised if the government gives it to them anyway.

[BR_Parkway]

33. So, in effect - they are nationalizing themselves? Without the R/W

noise machine screaming commie/pinko/fascist.

hmmm

[sendero]

35. Exactly...

.... it's ludicrous to think that this 34 billion will "fix" the bank. It's 34 billion now, and another 50 billion when the next wave of mortgages default, and then another 100 billion when the final wave defaults.

How or why Obama thinks he can fix this by printing money is beyond me.

[earcandle]

27. So if we own the banks that fail

We reorganize them and sell them back to the private market,
right?

We are part and whole of that private part.
We are those who must manage those who represent us.
We own a government that belongs to us. 

We own a government we fund with our taxes to provide us with
services 
and management to work out how to provide us with services
that give us 
what is necessary to have a fully working, intelligent,
educated, healthy 
and cultured civilized nation, right?  

Everything that stops that is politics, and needs to be
crushed. 

But how will we know what to do?  

Find the knowledge, and the people who manage knowledge to
help us get out. 

They are around especially in San Francisco.
London, NYC, Finland.  France. 

http://www.noodlebrain.com/EchoBop.mp3

[Autumn]

6. Fuck this shit

I am so fed up with those thieving bastards.

[saigon68]

37. How much are the "Executive Bonuses"

Oops they won't tell us

Ass-clowns

[Muttocracy]

7. You know how the credit card companies apply payments to your lowest interest rate balance

... I say we give our money to less expensive and risky recipients.

I can get myself out of debt for less than $34,000!

[madrchsod]

8. i need about 6000 to stay out of bankruptcy....

[ChromeFoundry]

9. Sure...Fire your Top-Paid 50 Executives FIRST!

They cause your company to fail in the first place... they don't need another bonus.

[Vidar]

10. Chrysler's in bankuptcy. Do the same for these fuckers.

[ChromeFoundry]

12. Damn Straight! n/t

[w4rma]

11. Not one more penny. And I don't want the Federal Reserve printing up money for them, either. (nt)

[SOS]

13. If they can't raise capital in the private sector, they should be seized, not bailed

Treasury should seize the holding company, put it in Chapter 11.
FDIC pays the depositors.
Just like they did with Washington Mutual.

But in Wall Street-owned America, these bastards will get their $34 billion of tax money next week and then raise your interest rates and hammer you with fees.

:mad:

[earcandle]

29. Just say no. Don't pay them.

[Double T]

14. Someone needs to stick a fork into BoA and tell them they are done!

Liquidate BoA's assets and let's move on.

[williesgirl]

15. So seniors can't get a COLA raise for 2-yrs but these fuckers get billions?

[emilyg]

23. Makes me want to scream.

[earcandle]

30. Make it really loud, don't hurt yourself. Use a bullhorn.

[jillan]

16. They need to raise more than that - I WANT MY 401K back!

Of course, it is just pennies compared to that amount, but it was alot of money to me....

assholes!

[earcandle]

31. You think this makes you mad? How does...

creating a water scare, providing"trusted" clean
water in plastic bottles,
and then realizing that these plastic water bottles emit
chemicals that
cause hormonal imbalances that lead to a product called
viagra?

If I were a boy, or a woman who wanted children and couldn't,
I would be
suing these fuckers.  What are we doing?  Watching the news go
by, getting high blood pressure,
dropping dead.

Not too smart. 

We RE SMARTER THAN THIS.
wAKE UP ROCKERS.

[2Design]

17. forget it - until they bring all jobs back, to usa - stop giving these entities money n/t

[MilesColtrane]

19. Bank of America buys Merrill lynch for 50 billion.

They buy Countrywide for 4 billion, exposing the company to untold amounts of toxic mortgages.

The CEO hosts a conference call with other corporate heads to formulate a strategy to defeat the passage of the Employee Free Choice Act.

They almost double the interest rates on their best credit card customers.

They increase fees on their customers savings and checking accounts an additional 65%.

Fuck Bank of America. Time for them to fold.

[strategery blunder]

20. Hey BoA, only if you want to pay the feds 25% interest...

Just like you did to me! :grr:

[Hawkeye-X]

21. Bank of America needs to be either 1) shut down or 2) grant us a complete clean slate

on BoA credit cards and give us 300+ point jump in our credit report, then I, as the owner of Bank of America, will approve the transaction.

What? I'm a taxpayer, I'm paying for these fuckups. I think I can demand what I want in exchange for my money.

[Iowa]

22. Does anyone here use BOA?

It seems everyone in the entire country, of every political stripe, is outraged by these thieving bums (and the worthless politicians who are transferring our money to them). But I wonder how many people have actually yanked their deposits and switched to a credit union.

[slampoet]

25. Okay then i want them to cough up Shawmut bank and Bank of Boston .

They can spin off the banks they took over.


BTW Bank of Boston gave reliable dividends for over TWO HUNDRED YEARS before bank of america took them over.

[earcandle]

32. Maybe you can get them back. Try to. Ask gov to clean it up and give it back. Let the city buy it.

or something like that. 

[liberal N proud]

34. We should let BOA fail

I am sick of giving money to these bastards who take it and party on it.

[Wednesdays]

38. K&R

:kick:

[InfiniteThoughts]

39. i am sorry but i have to say this aloud ...

$34 BILLION

As in $34,000,000,000 ....

over and above the $45 billion that you received from the government ...

do the bankers realized that billion is a lot of money and not chump change! They should be ashamed of themselves for landing in such trouble ...

NATIONALIZE THESE BANKS ... They have no right to remain in private hands after what they have done. $79 BILLION would buy healthcare for entire US population for a year!

[RubyDuby in GA]

40. And America needs the EFCA, so B of A can suck it until they STFU trying to derail it.

And I'm a B of A account holder, but I'm also a proud Teamster wife. :)

[CountAllVotes]

42. time to say ENOUGH already!!!

ENOUGH ENOUGH ENOUGH!!

:dem: :kick: