Bank of America Has ‘No Reason Whatsoever’ to Increase Capital, Bove Says
“There’s no reason for the bank to have to go out and raise capital whatsoever,” Bove said in an interview today with Bloomberg Television’s Margaret Brennan.
Bank of America has fallen more than half in New York trading this year amid speculation that costs from mortgage disputes will drain capital. Henry Blodget, the former Internet analyst turned blogger, wrote on Business Insider today that writedowns and loan costs may force the Charlotte, North Carolina-based firm to raise as much as $200 billion.
“You cannot break the bank by driving the price of the stock lower, particularly if the bank is as cash-rich as this one is with deposits pouring in,” Bove said.
Bank of America pared its losses today after Bove’s remarks. The shares slipped 1.1 percent to $6.35 as of 10:30 a.m. in New York Stock Exchange composite trading. They had previously fallen as much as 6.4 percent following Blodget’s post.
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