Wednesday, July 9, 2014

Report: BofA again seeking 5-cent dividend

Bank of America is seeking Federal Reserve approval to raise its quarterly common dividend to 5 cents a share after suspending plans to increase it to that level following the discovery it miscalculated its capital ratios, The Wall Street Journal reported late Wednesday, citing people familiar with the matter.

The Charlotte-based bank had planned to increase the dividend from 1 cent and buy back $4 billion in common stock, a plan the Fed approved earlier this year.

But the bank had to suspend those plans after it learned it had incorrectly accounted for a type of debt inherited in its 2009 Merrill Lynch acquisition.

The bank's dividend has been at 1 cent a quarter since the financial crisis. Following the crisis, the nation's largest banks must receive Federal Reserve approval before raising dividends or buying back stocks.

Bank of America spokesmen could not be immediately reached for comment.

The Fed has until August to decide on Bank of America's resubmitted capital plan.