Bloomberg reports that the bank has fulfilled a goal Moynihan drilled into subordinates since his first day on the job: building a 'fortress balance sheet', he said in an October 17th staff meeting at the company’s Charlotte, North Carolina headquarters.
'We’re going to officially declare victory on one of those operating principles', Moynihan said in the town-hall style meeting. 'The reason why is, we have the top capital in the industry, the top liquidity in the industry'. People have stopped asking if the bank needs more funds to absorb losses and now want to know when investors will get the excess, he said.
His display of confidence is a turnaround from last year, when investor concerns about the bank’s health spurred Buffett’s Berkshire Hathaway Inc. (BRK/A) to offer a $5bn injection, just as it had done for Goldman Sachs Group Inc. (GS) during the financial crisis. Bank of America went from trailing peers to having the industry’s best balance sheet, Moynihan said last week.
Unlike last year, the CEO avoided saying the dividend would increase, telling staff that he won’t 'get ahead' of the Federal Reserve’s 2013 approval process. Moynihan, 53, was criticized in 2011 for implying the dividend would rise, only to have the central bank reject his request. The company passed this year’s Fed stress test by leaving payouts unchanged.
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