Wealth and Investing Center

BofA shares plunge to June 2009 low on mortgage woes

By Maria Aspan

NEW YORK | Wed Oct 20, 2010 11:48am EDT

NEW YORK (Reuters) - Bank of America Corp (BAC.N) shares hit their lowest point since June 2009 on Wednesday, after accusations that the company inappropriately handled more than $47 billion in mortgage bonds prompted some Wall Street analysts to downgrade its stock.

The bank's shares fell to $11.21 on Wednesday morning, their lowest point in over a year, before recovering slightly. They were trading down 3.5 percent at $11.39 by late morning.

Analysts at Oppenheimer & Co and Stifel downgraded Bank of America to "perform" and "hold" respectively, after a group of investors on Tuesday accused it of inappropriately bundling mortgages into bonds. Analysts at Robert W. Baird and Citigroup trimmed their price targets for the bank.

On Tuesday, Bloomberg News reported that the New York Federal Reserve and bond fund Pimco were among the investor group.

Bank of America, which reported better-than-expected quarterly earnings on Tuesday, said it would fight being held responsible for investors' losses.

(Reporting by Maria Aspan; Editing by Derek Caney)
Hot Stocks
Asian Markets

Related Quotes and News

Company
Price
Related News
We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
Comments (5)
ronaldl79 wrote:
It’s time to write an obituary for Bank of America and other large U.S. banks. If the American people are awake, they will not allow another round of taxpayer support to keep these fraudulent institutions in operation.

Oct 20, 2010 11:40am EDT  --  Report as abuse
sequoiahugger wrote:
Couldn’t agree more with ronaldl79.

It’s also time to starting writing an obituary for the Federal Reserve, which, through loose monetary policy and artificial manipulation of interest rates, played a significant role in causing the housing bubble and subsequent recession.

End the Fed.

Oct 20, 2010 12:39pm EDT  --  Report as abuse
joey686 wrote:
End the Fed? Are you joking? I say imprison every member for treason.

Oct 20, 2010 1:13pm EDT  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.
See All Comments »