© 2020 WFAE
90.7 Charlotte 93.7 Southern Pines 90.3 Hickory 106.1 Laurinburg
Play Live Radio
Next Up:
0:00
0:00
Available On Air Stations
Local News
Here are some of the other stories catching our attention.

Bank Of America Suspends Dividend Increase After Misreporting To Fed

bank_of_america_sign_0.jpg
Julie Rose
/
WFAE

Bank of America has suspended its planned dividend increase, after the Federal Reserve found problems in data the bank reported during its most recent stress test.

The stress tests are part of the 2010 Dodd-Frank financial law passed after the crash and recession. The Federal Reserve analyzes the capital and health of the nation’s largest financial firms, to ensure they are not in danger of failing. Bank of America says it misreported some liabilities from the 2009 acquisition of Merrill Lynch, during its latest test.

Bank of America’s stock dropped about 80 cents after the announcement, to $15.18. But bank analyst Bert Ely says this is not a big deal.

“Last month, the Fed denied the capital plans of five other large financial firms, so this is not an unusual occurrence,” says Ely. “Somewhat embarrassing, but it’s not unusual and not something people ought to be concerned about.”

Ely says the tests are new, and banks and the Fed are still working out the kinks.

A Wells Fargo analysis said the misstatement does not reveal any material weaknesses in the bank, but the hit to its reputation may hurt its stock in the short term.

The planned dividend increase is suspended until the Fed approves a new capital plan for the bank. The bank has 30 days to submit that plan, with correct numbers.

We Need Your Help Now More Than Ever

WFAE mask

Our newsroom is hard at work covering everything from the ongoing coronavirus pandemic to the aftermath of the election, the race for a vaccine and our communities' fight to rebuild. But we can't do it without you. Support our local journalism with a donation of ANY amount, and we’ll send you a free WFAE member mask courtesy of AllDayMask.com of Monroe.