AIG sued BAC for $10 billion today (for massive mortgage fraud) which sent the stock down 21%. Details including a copy of the lawsuit are here. Story from CNN below.
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CNN
Investors are losing confidence in Bank of America.
"Management has tried to reassure investors over the course of the last six months that they are getting on top of the mortgage problem but investors are very skeptical," he said, adding that there's really nothing that Bank of America can do to stop its stock price from falling.
There was more bad news for Bank of America. Credit default swaps (CDS) tied to its debt were at their highest level since May 2009.
Credit default swaps reflect the interest rates that Bank of America has to pay to borrow money. If they keep rising, Staite said it would exacerbate investor concerns about whether the company has enough liquidity to run its business.
Bank of America stories from today:
- BAC Stock Closes Down Almost 11% Today
- Conference call - CEO Moynihan calls BofA 'much stronger' than in 2007
- Chris Whalen Says: "Seize And Restructure Bank Of America NOW!"
- CHART - Bank OF America Stock Has Fallen 50% In A Month
- LIVE BLOG: Bank of America CEO Faces Investor Grilling