The Durham-based Center for Responsible Lending is urging Congress to pass an extension to a piece of legislation that keeps troubled homeowners from having to pay taxes on mortgage relief they are offered.
Generally, most debt discharged counts as taxable income. The Mortgage Forgiveness Debt Relief Act, passed in 2007, changed that for mortgage relief on principal residences, but the law is set to expire at the end of the year.
Thursday, November 29, 2012
The Durham-based Center for Responsible Lending is urging Congress to pass an extension to a piece of legislation that keeps troubled homeowners from having to pay taxes on mortgage relief they are offered.
Wells Fargo has added retired PricewaterhouseCoopers partner Howard V. “Rick” Richardson to its board of directors, the bank disclosed in a securities filing Thursday.
Richardson served as PwC's finance and banking leader from 1996 to 2000, among numerous other positions at the firm. He is a Duke University graduate and received a master's degree from Boston University.
“Rick Richardson served PwC for over three decades in a wide range of leadership, audit, and business advisory positions, including as the lead engagement partner for several of PwC’s largest financial services clients,” CEO John Stumpf said in a statement. “Wells Fargo is very fortunate to add Mr. Richardson and his vast knowledge of the financial services industry to the board, and we welcome him to Wells Fargo.”
The move brings the board's membership back up to 16.
Bank of America could be planning to enter the much-discussed world of "social impact bonds," a financing arrangement that helps fund ambitious projects aimed at the public good.
The Charlotte bank has applied for a trademark on the phrase "Anything a Society Truly Wants Can be Financed and Achieved." Its trademark application goes on to say that it pertains to social impact bonds or "project financing for socially beneficial programs."
Essentially, social impact bonds allow different "investors" to put up money toward achieving a certain goal -- say, reducing homelessness or boosting the high school graduation rate. Investors make a return if the goal is reached.
New York City announced the country's first social impact bond program in August, financed by Goldman Sachs. Its goal is to reduce recidivism among young people at Rikers Island jail.
It works like this: Goldman provided a $10 million loan to MDRC, a nonprofit that will implement an education and counseling program at the jail. If recidivism falls by 10 percent, the New York City government will pay MDRC, which will in turn pay back Goldman. If recidivism falls further, Goldman's investors would make a profit.
Social impact bonds are already off the ground in Britain and Australia, and are also commonly known as a "Pay for Success" program. The White House said earlier this year that it would like the federal government to put $100 million toward these programs.
Bank of America did not provide any information on its plans.
Wednesday, November 28, 2012
Wells Fargo said Wednesday that the Securities and Exchange Commission team investigating the bank's mortgage-backed securities disclosures has recommended that Wells not face any penalties.
In its February annual report, Wells Fargo had disclosed that it has received a notice from the SEC that it was under investigation.
The bank was told last week that the investigation into disclosures on its offering documents had ended and no action was recommended, Wells said in a securities filing.
Wells Fargo settled similar allegations in a private lawsuit for $125 million last year.
More banks are planning some type of acquisition in the next year, with executives at 57 percent telling Bank Director magazine they would pull out their wallets in 2013. That's up from 52 percent last year.
Of those, nearly half say they want to buy a healthy bank, 21 percent just want branches and 17 percent want to buy a failed bank through an FDIC transaction.
Of course, only 2 percent say they plan to sell. Almost 90 percent say they have no intention of selling.
Count on Charlotte to play a role in that. We've had examples of all three of those types of acquisitions here in the area in the past year.
BNC Bancorp said in June it would by Charlotte commercial bank First Trust. Carolina Premier Bank bought two new branches in South Carolina in January. CertusBank and Bank of North Carolina each bought a failed bank. And banks like Park Sterling Bank, which bought Citizens South earlier this year, are still looking to grow.
Bank of America, however, is definitely not looking to expand, CEO Brian Moynihan told investors two weeks ago.
Tuesday, November 27, 2012
Wells Fargo customers in Charlotte will now be able to deposit checks using their smartphones as the bank rolls out the feature across the country.
Wells had tested it in 15 states over the past four months. More than 600,000 checks were deposited by phone in that time frame, the bank said.
“The exponential growth of mobile banking is fueling the thirst for more futuristic, easy-to-use
applications such as mobile deposit,” mobile and digital channel head Brian Pearce said in a statement. "Mobile deposit is a very popular service among our customer base. Customers love the added convenience of depositing checks while on the go.”
The feature can be found in the bank's iPhone and Android apps. Customers choose which account to send money to, plug in the check amount, and take a picture of its front and back.
The technology has grown increasingly prevalent over the past year. Wells was beat out by Bank of America, BB&T, and Charlotte-based NewDominion Bank, among others.
CNBC set up shop in Charlotte on Tuesday to declare the city the nation's second-best for stocks.
Since last November, Charlotte's publicly traded companies have returned an average of 21 percent, Brian Sullivan and the "Street Signs" crew calculated. The financial news network specifically pointed out Bank of America, Lowe's, SPX, Carlisle Cos., Family Dollar and Sonic Automotive as top performers.
Broadcasting from the NASCAR Hall of Fame, Sullivan invoked gold-finding Conrad Reed and called Charlotte the "once sleepy" town that has become "Wall Street South" with "one of the most spectacular skylines in the South." CNBC also made sure to point out the kindness of a woman in a Piggly Wiggly T-shirt who offered them coffee.
Carlisle CEO David Roberts talked about shutting down factories in China and opening them in the U.S. Small business owners also got a plug, Charlotte financial adviser Larry Carroll talked fiscal cliff, and Speedway Motorsports president Marcus Smith discussed Nascar's impact on the economy.
Philadelphia came in No. 3, by the way. The top city should be unveiled tomorrow.
Here's a sampling of Sullivan's tweets from his visit:
Local resident Dottie offering to bring us some coffee as she walked by our taping. ____ folk are so nice. twitter.com/SullyCNBC/stat…
— Brian Sullivan (@SullyCNBC) November 27, 2012
In this town you can apparently take buses a REALLY long way twitter.com/SullyCNBC/stat…
— Brian Sullivan (@SullyCNBC) November 27, 2012
Love this twitter.com/SullyCNBC/stat…
— Brian Sullivan (@SullyCNBC) November 27, 2012
Monday, November 26, 2012
Bank of America's stock price could be set for a steeper skid than any other big bank should Congress fail to reach an agreement on the so-called "fiscal cliff" by the end of the year, analysts with Guggenheim Securities say today.
- Bank of America has fallen farther than its peers the last few times the industry slid.
- While bank stocks have fallen slightly in the last few months, Bank of America's stock has actually increased.
Charlotte-based LendingTree and its parent company Tree.com announced that a settlement has been reached in the company's patent infringement lawsuit against QuinStreet, Inc..
QuinStreet, which operates GuideToLenders.com and HSH.com, will now license LendingTree's technology and no longer question its patent, according to a news release.
LendingTree owns a patent it claims gives it the right to a system that allows people to fill out a single loan application online and have different mortgage companies bid on their business.
The company sued a number of other firms that later started similar loan-matching websites in 2010, and settled with Leadpoint last year. Suits are still pending against Zillow, Adchemy, and Nextag, which all operate similar systems. A trial is scheduled for 2014.
LendingTree has found itself on the other end of patent suits in recent years. In 2010, it paid Source Search Technologies LLC about $9.5 million to settle claims that LendingTree infringed on SST's online transaction patents.
Friday, November 23, 2012
Last Thanksgiving, Bank of America's stock price was near the lowest it had been all year. It had just ceded its title as largest U.S. bank by assets, and was still licking its wounds after a public debacle over a proposed debit-card fee.
The Charlotte bank finds its position a bit brighter this year, and certainly has plenty to be thankful for. But it also has a lot still to do, financially and in terms of winning back the public's favor.
Here are five things the bank is thankful for, and five things Bank of America or the public aren't grateful for.
1) Stock performance. Bank of America's stock has gone from worst to first in the Dow Jones Industrial Average, having gained more than 77 percent so far this year. Sure, it's still under $10, but it now has "buy" ratings from several investment firms. It's up more than 8 percent just in the last week.
2) Capital standing. In deciding how much extra capital the world's largest banks would be required to keep on their books, international regulators cut Bank of America a bit of a break earlier this month. Apparently recognizing the slimming the bank has done, the regulators put Bank of America in a lower tier than its peers JPMorgan Chase and Citigroup.
The Charlotte bank -- subject to change -- would be required to hold only a 1.5 percent extra cushion instead of 2.5 percent. According to the bank's calculations, Bank of America would already comply with all the new requirements not going into effect until the end of the decade. That makes it much more likely the bank will be able to increase its penny-per-share dividend in the coming year.
3) No Bank Transfer Day momentum. After that ill-fated debit card fee, a group of anti-bank activists started an online movement exhorting people to leave banks and join credit unions that gained a lot of national attention. After initially claiming success, it seems the movement has had little to no negative impact on the bank. Bank of America had 1 percent more deposits at the end of the third quarter than it did a year ago, at more than $1 trillion.
4) Technology adoption. Bank of America's customers seem to be gravitating toward its mobile banking platform, which remains one of the biggest in the country. The bank now boasts 11.5 million mobile customers, and is still signing up 50,000 a week. It's also now trying to get a product into small business owners' hands.
5) Moynihan's support. At a time when Citigroup's CEO was forced out and JPMorgan Chase's is still somewhat on the hot seat, the financial community seems to at least tepidly buy in to Bank of America CEO Brian Moynihan's strategy. He may not be President Obama's favorite banker anymore, but investment firm analysts have cited Moynihan's moves as a reason to buy the stock. Hey, he even got an endorsement from Bono.
1) Job losses. You can hardly sing the bank's financial praises without recognizing the hundreds of families the bank has wounded in Charlotte and elsewhere to get there. Bank of America has about 16,000 fewer employees (or 6 percent) today than it did a year ago, and still has more people to lay off.
2) Litigation. There's seemingly no end in sight to the lawsuits being filed against the bank, primarily over allegedly fraudulent information given to firms that bought its mortgage-backed securities. Another was just filed on Wednesday. Its multi-billion settlement of claims the bank lied to shareholders before buying Merrill Lynch wiped out its earnings in the past quarter. Libor-rigging lawsuits could cost the bank more than $4 billion, and Countrywide is still deemed one of the worst business deals of all time.
3) Bad loans. Bank of America still manages more than 900,000 severely (60+ days) delinquent loans, per the bank's last quarterly report. And the bank will be under a good deal more scrutiny in the coming months about how the bank services them as part of the national mortgage servicing settlement.
4) Protests. The bank remains one of the biggest targets for protesters because of its size and the fact that it's responsible for one of the most maligned subprime lenders after buying Countrywide. A group temporarily shut down four Charlotte branches last week while protesting the bank's coal financing. Bank of America also became the victim of a cyberattack that spread to a number of other banks a few weeks ago.
5) Regulations. The banking industry had put a lot of money into helping Mitt Romney and Republicans win election -- which obviously proved unsuccessful. A Republican administration presumably would have weakened the increasingly active Consumer Financial Protection Bureau and been more receptive to scaling back parts of the Dodd-Frank financial reform law that the industry deemed particularly onerous. With Democratic star and outspoken anti-bank figure Elizabeth Warren joining the U.S. Senate, the regulatory environment could get less friendly for the Charlotte bank.
Tuesday, November 20, 2012
The national mortgage settlement progress report yesterday came with an eye-popping number: $26 billion in total homeowner relief.
In reality, they're probably closer to half that.
As we noted, the banks don't get full credit for every form of homeowner help they provide. Take Bank of America. Here's what was reported from them yesterday:
- First-lien principal reduction: $889 million
- Forbearance forgiveness: $231 million
- Second-lien modifications and extinguishments: $2.355 billion
- Short sales completed: $7.435 billion
- Deficiency waivers: $549.9 million
- Borrower transition funds: $66.9 million
- Refinance relief: $53 million
In a quarterly report earlier this year, Wells Fargo disclosed how some of these programs will be credited. Here's what Bank of America's figures look like weighted. Assumptions I've made appear below.
- First-lien principal reduction: $889 million x 100% credit = $889 million (1)
- Forbearance forgiveness: $231 million x 40% credit = $92.4 million
- Second-lien modifications and extinguishments: $2.355 billion x 50% = $1.178 billion (2)
- Short sales completed: $7.435 billion = ($7.435b * .60 * 20%) + ($7.435b * .40 * 100%) = $3.866 billion (3)
- Deficiency waivers: $549.9 million x 10% = $55 million
- Borrower transition funds: $66.9 million = ($66.9m * .60 * 45%) + ($66.9m * .40 * 100%) = $44.9 million (4)
- Refinance relief: $53 million * (unknown) = $53 million
Total: $6.2 billion (approximately)
(1) First-lien principal reduction only gets full credit if the loan-to-value ratio on the home is less than 175 percent. Otherwise, the amount over that gets only 50 percent credit.
(2) Second-lien modifications get different credit depending on how delinquent the loan is and how troubled the borrower's situation is overall. I chose the middle-ground number because of what the bank had already disclosed.
(3) Short sales can be credited between 20 percent and 100 percent depending on who owns the loan and takes the loss. Bank of America has said that 60 percent of its relief is going to investor-owned portfolios, and the rest bank held.
(4) The transition funds are credited similarly to the short sales.
Granted, this is an extremely rough estimation. It's impossible to know exactly where the banks stand until monitor Joseph Smith and his professional firms do the work of crediting everything. The banks also get extra credit for offering relief in the first year of the settlement, as opposed to years two and three.
But the banks' true standing is clearly well behind the large numbers reported yesterday. Still, Bank of America has three years to give about $9 billion in total homeowner relief, so it's making progress.
If you apply the same formula to the whole pie, you get a much more realistic $12.6 billion. About half of what was reported yesterday.
About those short sales
More than half of the relief has come in the form of short-sales, which force the borrower from their home. That seems counter-intuitive to the settlement's stated goal of keeping people in their homes.
The settlement's architects defended the volume of short sales Monday.
"Short sales are very important for the market," Colorado attorney general John Suthers said. "Get (the homes) back on the market, get them purchased by those who can afford to live in them."
By the end of the period, a maximum 40 percent of the total relief can be from short sales.
Principal reduction (either first- or second-lien) must be 60 percent. First-lien must be 30 percent.
FNB United, the Asheboro-based parent of CommunityOne Bank, reported losing $4.7 million in the third quarter, an improvement over a $13.9 million loss it posted in the same time period last year
The bank said it worked off $15 million in problem assets in the quarter, reducing its total by 9 percent. FNB is also cutting costs by closing some branches and reviewing its vendors.
FNB United has been rebuilding after its marriage with Bank of Graniate and recapitalization last year as both banks were deeply troubled.
Monday, November 19, 2012
The analysts at investment firm Stifel Nicolaus upgraded Bank of America shares to a "buy" Monday -- and the bank's shares were up 4 percent by mid-day.
The report says the Charlotte bank will be able to increase its earnings by a greater percentage than its peers once the effects of Bank of America's massive cost-cutting program are finally felt. The bank plans to ultimately cut $8 billion off its annual expenses through streamlining and about 30,000 job cuts.
Stifel also said it liked the bank's capital position and expects a dividend increase.
"BAC is actually better positioned for the current environment than many banks that have already bled the loan loss reserves dry, have little exposure to mortgage origination and debt underwriting in the low interest rate environment, and have no material expense reductions on the horizon," the analysts wrote.
The analysts set a target price of $11 per share. It's currently around $9.50.
Bank of America announced Monday that Linda Lee Stanley will become the bank's commercial banking market executive for North Carolina and South Carolina.
The unit provides services like treasury management and credit to middle-market businesses earning between $50 million and $2 billion in annual revenue.
Previously, Stanley had been a senior client manager for Bank of America Merrill Lynch in the Southeast, primarily serving middle-market energy companies.
Friday, November 16, 2012
Greenville, S.C.-based CertusBank will assume the deposits and assets of a failed Georgia bank, the FDIC announced Friday.
CertusBank, which has about $2 billion in assets and 31 offices, is run by former Bank of America and Wachovia executives. It has a corporate office in SouthPark.
Branches of Hometown Community Bank of Braselton, Ga., will open as CertusBank branches Monday. CertusBank had previously bought three other failed banks in South Carolina and Georgia.
Wells Fargo will hold a number of interviews for mortgage underwriter positions later this month in Charlotte, the bank said Friday.
The event will be held at the Charlotte Marriott Executive Park near I-77 and Tyvola Road. People interested must schedule an interview by applying for positions online with the requisition numbers 3682567 or 3682470.
Thursday, November 15, 2012
George K. Baum & Co., a Kansas City-based investment bank, announced Thursday that it has opened an office in Charlotte specializing in public finance.
It will be led by David Adams, a newly appointed senior voice president for the Southeast, who has extensive experience in education finance. He's led financing for schools including Davidson College, N.C. State University, UNC-Wilmington and High Point University.
The firm has office space in 112 Tryon Plaza, according to its website.
In September, fellow investment bank Banks Street Partners said it was opening a Charlotte office.
Albemarle-based Uwharrie Capital Corp. plans to issue new preferred stock this quarter that will be used to pay back its federal bailout money it received from the Troubled Asset Relief Program, the bank said Thursday in a quarterly report to shareholders.
"If we are going to be paying dividends on preferred stock we would prefer to pay them to you and your neighbors," CEO Roger Dick wrote in a letter. His bank had received $10.5 million.
"An important benefit of refinancing the Treasury’s preferred stock is that instead of the dividend going out of our communities to Washington, it will directly benefit local market residents, creating our own economic 'stimulus' if you will."
The U.S. Treasury said Wednesday that it would auction off the TARP investment remaining in Charlotte-based Bank of Commerce and Lincolnton-based Carolina Trust Bank.
The Securities and Exchange Commission has received 67 whistleblower complaints from North Carolina in the past year, the regulator said in its annual report released Thursday.
That tied the state for 10th-most in complaint volume, with Arizona. South Carolina was the source of 21 complaints. The SEC received a total of 3,001 complaints.
The regulator's Office of the Whistleblower is a requirement under the Dodd-Frank financial reform law. The law also allows the government to pay the whistleblower a percentage of any penalty extracted from the company. The first whistleblower payment was $50,000.
The largest category of complaints were about corporate disclosures and financials, with 18 percent of the total. Fraud came in second with 15.5 percent.
The largest number of complaints, 435, came from California. New York was second, with 236.
U2 frontman Bono and Bank of America frontman Brian Moynihan shared a stage as "two rock stars" earlier this week at Georgetown University.
And the CEO got a bit of praise from the Irish rock legend, calling him a "very special man" and "a gentleman in a world where that quality isn't always on tap."
"I certainly can't partner with Bono in a studio, but I can partner with him to make the lives of millions better around the world," Moynihan said.
You can watch the event here. Here's a copy of Moynihan's prepared remarks.
Wednesday, November 14, 2012
Bank of America said Wednesday that it has now offered $15.8 billion in relief to more than 160,000 households as part of the national mortgage servicing settlement announced early this year.
Of that, about $4.75 billion was in first-lien mortgage principal forgiveness, senior vice president Eric Telljohann said on a conference call with reporters. The most relief, at $7.4 billion, remains through short sales, though he said that mix should change over the next few months.
The bank also said it is in "effective compliance" with the hundreds of new servicing rules it agreed to as part of the settlement, which includes a "single point of contact" system for homeowners behind on their mortgages. Each contact is responsible for 70 to 75 mortgages, Telljohann said in a Q&A session.
In the last few months, the Charlotte bank has sent letters to hundreds of thousands of homeowners offering relief.
"That momentum is not slowing down, and in fact, it's accelerating," Telljohann said.
It is unclear, however, where the bank stands in its $11.8 billion commitment as part of the settlement because not all forms of relief are given full dollar-for-dollar credit.
Bank of America, Wells Fargo, Citigroup, JPMorgan Chase and Ally Financial were required to file their latest progress reports Wednesday on foreclosure prevention efforts to the monitor of the mortgage settlement, Joseph Smith.
Smith, the former N.C. banking commissioner, is expected to review the filings and release a report by early next week.
Fifth Third Bank announced Wednesday that it is jumping into the prepaid debit card market, joining an increasingly crowded field of banks and retailers targeting lower-income customers who don't want a traditional checking account.
The Access 360° card has a fee schedule in line with the rest of the industry. There is a $7 monthly service fee, which is cut to $4 if the customer puts at least $500 on the card per month. Customers do not need to pay to reload the card. A $25 deposit is required to get a card.
Tuesday, November 13, 2012
Bank of America, Wells Fargo and the three other banks part of the $25 billion national mortgage settlement are scheduled to file a progress report Wednesday on what aid they've given homeowners so far.
Mortgage settlement monitor Joseph Smith, formerly the N.C. banking commissioner, will then analyze the reports and is likely to release the results next week.
The last report was released in August, and showed that progress on helping North Carolina homeowners had been slow. It also showed that Bank of America had yet to offer principal reduction to any of its homeowners by the end of June.
The Charlotte bank has since announced several programs offering principal reduction.
Bank of America is expected to release some of its data to the public Wednesday afternoon.
Called "Mobile Pay on Demand," the system allows businesses to accept payments through their smartphone or iPad through a secure card reader that plugs in and free app.
The company will not charge monthly fees. Businesses will pay 2.7 percent per swipe. The service will be available starting Dec. 3.
“In today’s economic environment, small businesses are looking for secure, easy and portable ways to confidently accept payments beyond cash, and promote their business to a broader customer base,” said Tom Bell, CEO of Bank of America Merchant Services. “We are making it even easier for small business owners to accept secure payments anywhere."
Bank of America Merchant Services is a privately held company jointly owned by the Charlotte bank and First Data Corp.
Square, which processes about $8 billion in annual payments, has about 5,000 customers in the Charlotte area. PayPal, Intuit, Groupon and Google also have products in the space.
Thursday, November 8, 2012
Park Sterling Bank announced Thursday that it has named Bank of America's Judy Wishnek as its new Charlotte market president.
Wishnek will be responsible for commercial banking in the Charlotte region for Charlotte-based Park Sterling. She had been a business banking market manager for Bank of America. Before that, she was an executive at Wachovia and PNC Bank.
“We are delighted to have Judy join our management team," CEO Jim Cherry said in a statement. "In addition to proven leadership, banking experience, and market knowledge, she brings a demonstrated commitment to community service and involvement."
Wednesday, November 7, 2012
Bank of America shares, along with most other Wall Street stocks, opened considerably lower Wednesday as investors reacted to the election results.
Unsuccessful Republican candidate Mitt Romney had pledged to roll back a number of the provisions of the Dodd-Frank financial reform law, which the banking industry has spent considerable effort fighting. A Republican victory was also expected to considerably weaken the fledgling Consumer Financial Protection Bureau.
On top of that, Democrat Elizabeth Warren, one of Wall Street's chief critics, won her Senate race against incumbent Scott Brown.
Bank of America shares were down more than 5 percent. Wells Fargo fell 3 percent. All 30 companies in the Dow Jones Industrial Average were down as of 11 a.m.
Tuesday, November 6, 2012
Bank of America has extended its automatic fee-waivers in states hit by superstorm Sandy through Wednesday.
The Charlotte bank said it will refund overdraft, debit card replacement, early CD withdrawal, cash advance and late payment fees for customers in the following areas:
- New Hampshire
- New Jersey
- New York
- Rhode Island
- Washington D.C.
- West Virginia
Monday, November 5, 2012
In its first full quarter since selling its mortgage origination business, Charlotte-based Tree.com posted a profit of $4.4 million, two-thirds less than the same time period a year ago.
The company is best known for its LendingTree mortgage website, but also operates sites listing colleges and home improvement services.
Tree.com sold its mortgage origination business last quarter to Discover Financial for nearly $26 million as the company seeks to return to a strictly lead-generation business.
The company said that without taking its discontinued mortgage business into account, its financial performance has been improving.
"Tree delivered another great quarter. This was our first full quarter as a pure-play performance marketing company and we grew both top- and bottom-line," CEO Doug Lebda said in a statement. "We continue to leverage our brands to drive consumers to our sites and provide quality leads to our clients."
Charlotte-based First Trust Bank reported net income of $929,000 in the third quarter, 35 percent less than the $1.42 million profit it posted in the same time period last year.
But the bank's percentage of bad loans continued to fall, hitting 5.6 percent of total assets from 8.7 percent at the end of last year.
High Point-based BNC Bancorp announced in June that it would acquire First Trust Bank in a cash and stock deal. It is scheduled to close in the fourth quarter.
Friday, November 2, 2012
Bank of America chief financial officer Bruce Thompson told investors Friday that he expects the volume of litigation filed against the bank to soon "quiet down."
He said that the majority of lawsuits faced by the Charlotte bank come in the mortgage realm and deal with loans made between 2005 and 2008. Federal suits on mortgage issues must be filed within three years, Thompson said, and state suits have a six-year window.
"You clearly expect, for us, for litigation to continue to quiet down," Thompson told investors at the BancAnalysts Association of Boston Conference. "We continue to work very hard to put these legacy issues behind us."
Thompson also tried to impress upon investors that the bank was in a position to increase its revenue going forward. After acknowledging that he frequently hears that investors worry that the shrinking Bank of America has less ability to make money, Thompson said that taking out one-time accounting charges, Bank of America brought in slightly more money in the third quarter than it had the year before.
"We're at a point where you should judge us on how we're doing going forward," Thompson said.
Charlotte-based Park Sterling Corp. announced Friday that it earned $620,000 in the third quarter, or 2 cents per share, and said it would use its better financial performance to buy back a significant percentage of its stock.
The bank's third quarter performance compares with a loss of $1.4 million in the same quarter a year ago. CEO Jim Cherry said in a statement that the difference came from setting aside less for bad loans and mortgage banking income.
Park Sterling also completed its merger with Citizens South Banking Corp. in the quarter.
The bank now has authorization from its board to buy back 2.2 million common shares, or 5 percent of its outstanding shares, over the next two years.
"This new share repurchase authorization reflects the confidence our board of directors has in Park Sterling's financial position and growth outlook, as well as their commitment to enhancing shareholder value," Cherry said in a statement.
Thursday, November 1, 2012
Bank of America could be forced to hold an extra 1.5 percent of top-quality capital as a systemically important financial institution, global regulators announced Thursday. That's significantly less than the 2.5 percent surcharge the bank could have faced.
Essentially, this additional capital buffer is an attempt to provide more of a cushion against losses in the event of another global financial crisis. Regulators have been devising the plan for about a year. The numbers will be revised again next year, and won't begin to phase in until 2016.
JPMorgan Chase and Citigroup are among four global banks facing the top capital charge of 2.5 percent. Some analysts had expected Bank of America to fall in that category.
The bank had not released an estimate for where it thought it would fall, and did not comment on the decision Thursday.
As it stands, Bank of America would already comply with all its new capital requirements. The bank has been shedding assets and business lines over the past several years, and reported a Tier 1 common capital ratio of 8.97 percent at the end of the third quarter.
Bank of America's stock rose more than 4.5 percent Thursday, to $9.74. It had edged up slightly higher in after-hours trading, as of 5 p.m.
Every chance they get, investors quiz Wells Fargo executives on just how much longer the bank can make so much money in the mortgage business.
BB&T announced Thursday that it will double its banking presence in Texas, adding 30 branches in four cities next year.
The expansion will be in Dallas/Ft. Worth, Houston, San Antonio and Austin, the bank said. The new branches still must be approved by regulators.
"The BB&T brand is gaining great traction in Texas, and our success with the community bank has been truly phenomenal," BB&T Texas region president Kay St. John said in a statement. "These four cities are densely rich commercial and small business markets representing many of the highest potential growth areas within BB&T's entire footprint."
The Winston-Salem bank will look to occupy vacant office space rather than build new branches. The $40 million investment is expected to add 150 jobs.
BB&T's deposits in Texas have grown nearly 70 percent in the last three years, the bank said. It now has $1.65 billion in loans in the state as well, and about 200 community banking employees at 27 branches.
The bank entered Texas through its 2009 acquisition of Colonial Bank.
BB&T has about 1,200 employees in Texas overall, including auto loan call centers and offices and insurance operations.