I'm not a holder of BAC ... just a long ago former officer of the company that gave me a job when I was discharged from the Navy; when it was solely located in California. Have always had a soft spot in my heart for it.
At these levels, I am now finding it extremely attractive; but had not kept up to date with it since the original founder (Gianonni) family sold their holdings ... by the way ... met AP one time back in my younger days.
Anyway, at these levels, what is the background on the present day owners regarding reducing the dividends/ I see the eps is above the declared divy; but with the present market, am concerned the management may reduce the dividend. And for an income investor, that would not be good.
Will appreciate your inputs. Please ... no flaming..... I am not into that.
Sure was easier in my day ... back in the 90's.
So, if I understand, we ... the USofA ... has adopted the home ownership aspects of the Euro countries? What is the advantage of that ... for the USofA ... other than allowing a bunch of deadbeats, and speculators, ruin our economy?
It has to do with the very complex algorithms they are supposed to adopt for determining risk. So complex that the regulators are now wishing they hadn't agreed to Basel II. The big banks like BAC are wanting out of them as well.
I guess you haven't listened much about the new Basel II agreement, have you. Basically, the US is adopting the standards of most of the rest of the world. At this point, unless they get an exception, the biggest banks will have to adopt the most stringent of the new standards which will, in effect, lower capital requirements. If they get an exception to use the standard rules for all the smaller banks, the capital requirements will remain relatively the same.
Despite all the speculations surrounding the dividends, I received my latest payout from BAC on 6/30/08.
Nobody owns a real crystal ball here, so the future is anybody's guess. Ken Lewis has been repeatedly telling us that the dividend is safe for now, but there's no guarantee regarding the future payout, and I believe he's being frank about it.
Yes ... am well aware of that. In my day the banks were limited to being generally situated in just one state or 2; then about ... as I recall ... 1990+-, that all changed. Nowadays, the sky is the limit it seems; which opens up another huge can of worms for just what we've recently observed. Heck, in my days, if we criticized a bank for it's substandard ... doubtful ... loss loans, the management, via FDIC/FRB, were required to immediately begin corrective activities ... or fact closure. Right now, don't recall any closure notices over the past 2 administrations.
Nice to see someone who is real here. The company is viable. The question is short term cash flow. The liabilities created from the Countrywide deal seems to have the market in a frenzy. Outside of that I know that they have no other real issues. It is also a speculation if they will keep their dividend and ask for outside monies. Don't really know their, but my guess is no. You could easily argue that and many on the board will. Be careful who you listen to though. Their motivations are questionable for the most part. I am long and own. Additionally, I worked their for 10 years. You can make up your mind as to who you believe.
tbh i haven't bought any shares yet, as i think the crisis is far from over and thus i expect it to drop more till the end of the summer.
a) i don't think its possible for the company to maintain the dividend so high, when they have so much problems. In my opinion this choice, is going support the stock's price temporary. But those $10billion that were given in dividend were needed in solving some of the problems that recently arised.
b)In the long run, i think that in 3-5years from now BAC will be at $50 and a healthy company. The risk is yours, but i wouldn't put my retirement money in it, as you don't know what else is in the closet.