Bank of America expects to face legal losses this year for anywhere from $145 million to $1.5 billion. And that is just what it can reasonably estimate. Most of these losses stem from the underwriting of mortgage-backed securities.
The results of the bank’s investment arm have also been less than stellar. According to David Benoit writing for the Wall Street Journal Online, the bank reported that its investment- banking group had net profits on 90% of their trading days for 2010. While this sounds good, it should be noted that trading made over $25 million for three-quarters of the fourth quarter and lost more than $25 million on 4% of the trading days.
However, things don’t seem all that tough for BofA. For example, amid all the bad news, the bank still wants to increase its dividends to investors. Similarly, no moves have been made to dispose of the corporate jet and its crew. In fact, Bank of America has agreed to allow their CEO Brian Moynihan to lease the plane and its crew for personal use ? using his own money. No word on how that will be billed.
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