Bank of America

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It provides a diversified range of bankingand non-bankingv financial services and products through three businesss segments: global consumer and small-business banking, globa corporate and investment banking, and globalo wealth and investment management. It operates in all 50 states, the Districgt of Columbia and more than 40 foreign Rochdale Securities analyst Richard Bove has raised his price target for Bank of Americashare $5 to $19 per share whiler warning investors of loan losses, possibly setting aside $46 billionm in loan loss reserve for 2009.
“I n the second quarter, [Bank of America’s] position as the largestr lender in multiple sectors of the Americab financial system will haunt the companyt as itslosses expand,” Bove Bailing out Bank of America is its controversial acquisitions of Countrywidew and Merrill Lynch. The surgde in refinancing with lower interestratess (Countrywide) and the increase since the market low in Marchg of secondary equity financing (Merrill) are on balance boosting its second-quartet results. The scary part now is creditt card defaults. Bank of America said its defaultgrate (loans that are not expected to be paid back) jumped to 12.5 percen t in May from 10.47 percent in April.
American Express also saw a riseto 10.4 percent from 9.9 Macquarie Research analyst John Williams wrot e that “until lenders show stabilization, then trend-bucking improvemenyt over a several-month period, we remaimn bearish on credit card lenders — and the U.S. He estimates that if the default rate ends over 10 percengfor 2009, it would equate to an industru loss of about $70 billion. “We continue to believr that macro challenges and credit quality concerns willpressure U.S. card issuer over the next 12 Williams wrote.
“We expect further challenges as unemployment ticks More than 20 analysts followedd by Thomson Reuters still see increased earnings with 2009 estimated to be 72 centxs pershare vs. 55 cent s in 2008, and up again to $1.021 per share in 2010.