Bank of America CEO: Buyout Boom May Bring Correction
Bank of America chief executive Kenneth Lewis told CNBC he thinks "we're going to see some corrections taking place over the next few months" and that it will be driven more by an event like a deal going sour than a lack of liquidity.
In an interview with Maria Bartiromo broadcast on CNBC's "Closing Bell," Lewis said that he's never seen markets so liquid, or so many deals--and that "usually means the we're getting to the top of the market".
As for banks, Lewis said: "We're getting kind of an air of invincibility which means the industry is doing some things it shouldn't do." He added that Bank of America is "turning down (financing) more deals than we have in the past".
He also said that the recent boom in leverage buyouts has relied less upon banks for financing, so they will bear less of the brunt should deals fall apart.
When asked if Bank of America plans to buy mortgage lender Countrywide Financial, Lewis said the bank wouldn't rule anything out. Countrywide is the largest independent mortgage lender and seen by analysts as a potential takeover candidate amid troubles in the mortgage industry.
"We actually have consistently said we like the product, but we don't like the business," Lewis said. "So we don't particularly care about the wholesale business, or correspondent business. We like the direct to consumer side of (mortgage lending)... we just don't like the total business."
