$3 Billion Write-Down in Bank of America’s Future
An article published by Reuters gives details of the losses felt by Bank of America as they struggle to get out of debt. According to the article:
- Bank of America joined Citigroup Inc, Morgan Stanley, Wachovia Corp and other banks in projecting large fourth-quarter write-downs for exposure to mortgages and other debt that investors are no longer willing to buy.
- Bank of America Corp, the second-largest U.S. bank, said on Tuesday it expects to write down $3 billion of debt in the fourth quarter as fallout from the nation’s housing slump deepens.
- “The losses are not only manageable for the bank, but were long ago discounted by investors,” said Marshall Front, who oversees $800 million at Front Barnet Associates LLC in Chicago, including Bank of America shares. “Unless something enormous and unforeseen happens, major, diversified well-capitalized banks can handle these losses.”
Banks seem to be more confident that they can handle the losses that are currently plaguing them. This is good news to all those who were worried about a total financial collapse. It will be interesting to see how consumer confidence correlates with that of the mortgage lenders.
November 16, 2007 | Filed Under Get Out of Debt
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