Bank of America Overview: Bank of America is a leading diversified banking firm. By acquiring Merrill Lynch in September, 2008, it also has become a major player in the securities industry. Excluding Merrill Lynch, Bank of America's main lines of business include:
- Retail Banking
- Commercial Banking
- Investment Management
- Investment Banking
Size: Bank of America is among the largest players in the banking industry, across multiple dimensions, including (as of June, 2008 and excluding Merrill Lynch):
- Employees (Full Time Equivalents) = 206,000
- Retail Banking Offices in the U.S. = 6,100
- Number of Client Relationships = 59 million
- Assets = $1.7 trillion
- Presence in 31 Countries
Positives: The firm is a major nationwide banking presence in the U.S., whose subsidiaries include U.S. Trust, its main channel for serving ultra-wealthy individuals. Full-time equivalent employees fell a modest 4,000 (2%) from year-end 2007 to June 2008.
Bank of America will receive a $25 billion equity infusion from the Treasury Department under the $700 billion financial rescue package. This will solidify both its financial position and that of its new Merrill Lynch subsidiary.
Negatives: Bank of America closed its purchase of Countrywide Financial in June 2008. Countrywide has a large portfolio of troubled mortgages that may portend future financial problems. Charge-offs and write-downs related to troubled loan portfolios remain a significant problem in the first half of 2008, though net earnings are positive.
