BAC will have ability to return more capital to its share holders. It is interesting to note that under those extreme stress conditions that, according to their own calculations, BAC would lose over $$4 ps. Capital ratios would remain above the minimums, however.
Wow. My faith in the BAC board is restored a bit by the volume of response. I got killed adding above 12 a few weeks ago. Do you guys really believe we can hold above 12 being that the stress test result isn't a home run and capital return will prob be at the low end of the range or were the last few weeks an unwarranted beat down?
If memory serves me BAC has an open ended agreement with Buffet at 6%. I'd suspect they woud want to address such and we would hear the detais in April. Also as much as BAC would like to return cash to it's investor. Im not expecting too much at this time. I'd rather they be rock solid and take care of other concerns.
First the results of March 14 will be of importance.
Second any bank that was borrowing money from the govt whether repaid of not will need to get the approval from the govt re buyback and divi or AMOUNT of a divi.
Banks understand that yes they are doing much better they will also be a bit slow to use money foolishly. So yes they will lend more money out. But don't get to giddy re divis or buybacks yet re BAC. IF they are allowed to do so one woud expect the decision to be conservative. THUS any POP would be just that until it is KNOWN if divi or buyback can be sustained. IMHO