As Bank of America (BAC) prepares to shop for $4 billion of its own stock, a wooden-headed accounting mistake is driving the value down. Shares fell by virtually six % this morning once the bank aforesaid it had miscalculated what quantity capital it had reachable. The miscue additionally froze the bank’s strategy to reward loyal investors by raising its annual dividend from a penny to five cents a share–plans that ar on hold till Bank of America susses out with the Fed simply what quantity ballast is within the bottom of the boat.
The mistake was buried in an exceedingly difficult jumble of economic machinery that the bank genetic once it bought Merrill kill in 2009. The defect concerned structured notes, hybrid merchandise within which AN underlying debt obligation fluctuates supported one thing entirely separate. Imagine a loan whose payout rests on whether or not Facebook (FB) shares fall by twenty %. Continue reading “BAS set to buy his own stock for 4 billion” »