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Fed tells Bank of America to rein in dividend plan!

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posted on Mar, 23 2011 @ 10:49 AM
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CHARLOTTE, North Carolina (Reuters) - The Federal Reserve objected to Bank of America Corp's (BAC.N) plans to boost the dividend and told the bank to revise its proposal, sending its shares down 2.7 percent in morning trading.

yahoo.com/w/yfinance/article

It seems like BofA was trying to do things in order to get the stocks up and make money and they had a plan to do that but they fell down 2.7% in this mornings trade! Then the federal reserve told them to revise the plan and basically if they revise the plan good enough they could dominate in the banking industry! What do you think?

edit on Wed Mar 23 2011 by DontTreadOnMe because: attempt to fix link








edit on 3/25/2011 by 12m8keall2c because: fixed source link




posted on Mar, 23 2011 @ 11:11 AM
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Give me your lunch money....
Sorry had to do that. I'm always gonna remember you as the guy who started the bully thread.

Now on topic, I need to read more into the article so I don't have to pretend I understand. As far as I know the Fed does anything and everything in and of their own interest. Also, isn't the "siege" supposed to begin tomorrow?



posted on Mar, 23 2011 @ 11:35 AM
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reply to post by kid_cudi
 


I need to sign in to see the article. So do the shareholders income go down while the bonus payments go up?



posted on Mar, 23 2011 @ 01:35 PM
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Originally posted by Raelsatu
Give me your lunch money....
Sorry had to do that. I'm always gonna remember you as the guy who started the bully thread.

Now on topic, I need to read more into the article so I don't have to pretend I understand. As far as I know the Fed does anything and everything in and of their own interest. Also, isn't the "siege" supposed to begin tomorrow?


Haha funny! Star for that. What siege? I had no idea there was going to be one!



posted on Mar, 25 2011 @ 07:02 AM
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reply to post by kid_cudi
 


why dont you do research on your own threads and maybe you would know something before someone else posts it for you



posted on Mar, 25 2011 @ 07:11 AM
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reply to post by kid_cudi
 


Something wierd is wrong with your link.


Here's another one to the same story: Jonsonboro



posted on Mar, 25 2011 @ 10:32 AM
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reply to post by FortAnthem
 


hmmm, it does talk about reducing the dividend, which is reducing the return to shareholders. The stock price fell a tiny bit, but no word on bonuses. Sounds like some reality has returned to the accounting, in the short term at least. These numbers will come out with time.



posted on Mar, 25 2011 @ 02:52 PM
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So the purpose of handing out dividends to share holders is: returning excess capital to shareholders. But, BOA was showing a net loss of $2.2 billion for 2010, despite showing improvements in problem loans and loan losses.

It seems they are falling on hard times now that they are unable to gouge their customers as badly as they used to. The poor guys.



It posted losses in each of the last two quarters and has projected lower revenue due to new industry regulations.

In the 2010 fourth quarter, BofA recorded a charge of $4.1 billion related to the settlement of mortgage repurchases with government-owned mortgage finance companies Fannie Mae and Freddie Mac.

The charge was paired with a $2 billion writedown in the value of its home loans business. That followed a $10 billion third-quarter writedown in the value of its card business after new regulations curbed certain kinds of fees charged to customers.

Same article


So the bottom line is; they can't make the obscene profits they used to by screwing their customers under the old regulations (or rather lack therof) and, even though they are loosing money, they want to throw some money at their shareholders to keep them happy.

It was irresponsible practices like this that led to the financial collapse in the first place. You cannot go on paying out huge bonuses and dividends (excess profits) to shareholders when you are showing a loss. How can there be excess profits to give to the shareholders when you are operating at a loss?

These jerkwads need to get a taste of reality and come live in the real world like the rest of us. The world where, when you don't have the money for something, you just tighten your belt and spend within your means.



posted on Mar, 25 2011 @ 03:18 PM
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I went into my Chase bank the other day to ask if they were going to limit debit card purchased to $50 and the woman said that would be the limit then a fee would kick in. She said she didn't know when the rule would start but I would get a letter. I told her I probably wouldn't get the letter because it would only go to customers and within a few weeks I wouldn't be one. She smiled that and said a lot of people say that but will never leave them.

Yesterday I wrote a check for nearly the whole balance to a credit union account and as soon as the dust settels I'll write another for the balance



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