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Wednesday, April 29, 2009
News / Biz BofA doesn't pass stress test
Posted By Rhiannon Fionn-Bowman on Wed, Apr 29, 2009 at 12:53 PM
What a shitty week for The Ken. But, don't worry. He's gotten the bug from all of the protesters; he's going to do a little protesting himself. That's right. BofA doesn't agree with the results of the government stress test, but did you expect that they would?
Regulators have told Bank of America Corp. and Citigroup Inc. they may need to raise more capital as a result of the government-mandated stress tests of big banks, according to media reports Tuesday that cited anonymous sources.Some analysts have speculated that Wells Fargo & Co. could also be told to raise more capital.
If banks are told to increase capital, they'll be able to choose between trying to raise money from private investors, converting the government's preferred shares into common, or taking out more government loans. Those loans would come with strict conditions, including a 9 percent interest rate and a requirement that the bank cut shareholder payouts to one penny.
Read the rest of this Charlotte Observer article here.
What in the hell is up with these stress tests? Check this out:
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