BofA, Longtime Leader in Leveraged Loans, Warns of `Carnage'

The U.S. economy is on solid footing except for one potential trouble spot, according to Bank of America Corp.’s Chief Executive Officer Brian Moynihan: leveraged loans -- a business the bank has dominated for a decade.

Problems aren’t yet emerging as the economic expansion continues and companies churn out profits, Moynihan said Tuesday at the Economic Club of New York. His own bank has repeatedly said it focuses on “responsible growth” and sticks to lending standards it’s had for years. Yet, leveraged finance threatens to become an issue in the broader market, he said.