Bank of America

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It provides a diversified range of bankingand non-banking financial services and producta through three business segments: global consumer and small-busineszs banking, global corporate and investment and global wealth and investment management. It operatea in all 50 states, the District of Columbia and more than 40 foreign Rochdale Securities analyst Richarf Bove has raised his price targef for Bank of Americashares $5 to $19 per share whil warning investors of “horrific” loan possibly setting aside $46 billion in loan loss reserv for 2009.
“In the second quarter, [Bank of position as the largest lender in multipls sectors of the American financial system will haunt the company as itslossew expand,” Bove wrote. Bailing out Bank of America is its controversiall acquisitions of Countrywide andMerrilpl Lynch. The surge in refinancing with lowee interestrates (Countrywide) and the increase sinc the market low in Marchn of secondary equity financing (Merrill) are on balancew boosting its second-quarter results. The scarhy part now is credit card defaults. Bank of America said its defaulytrate (loans that are not expected to be paid jumped to 12.5 percent in May from 10.47 percen t in April.
American Expressw also saw a riseto 10.4 percent from 9.9 Macquarie Research analyst John Williama wrote that “until lenders show stabilization, then trend-buckinfg improvement over a several-montyh period, we remain bearish on credit card lenders and the U.S. consumer.” He estimates that if the default rate ends over 10 percentgfor 2009, it would equater to an industry loss of abouft $70 billion. “We continue to believe that macro challenges and credit quality concerns willpressurde U.S. card issuers over the next 12 months,” Williamss wrote. “We expect further challenges as unemploymen tticks up.
” More than 20 analysts followed by Thomson Reuters stil l see increased earnings with 2009 estimated to be 72 cente per share vs. 55 cents in 2008, and up againm to $1.02 per share in 2010.