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Bank of America Searches for Assets to Sell

Bank of America plans to identify tens of billions of dollars in assets and businesses that it wants to sell or wind down, in the latest effort to ease investors’ concerns about its holdings of risky securities and loans.

The move could set the stage for more aggressive steps to shrink the bank’s $2,300 billion-plus balance sheet at a time when regulators and shareholders are putting pressure on lenders to slim down.

Photo: Oliver Quillia for CNBC.com

Executives at BofA , the largest US bank, have told analysts and fund managers in recent meetings that they were weighing detailed disclosures on the loans, businesses and stakes that do not fit in their long-term plans, according to people who attended the gatherings.

Although the plans have not been made public, analysts said that the non-core assets could exceed $100 billion, and include both complex structured-credit products and impaired loans that came with its 2008 acquisition of Countrywide Financial, the mortgage lender.

BofA declined to comment.

“BofA intends to provide more details on its non-core assets at some point in the future,” said Betsy Graseck, a Morgan Stanley analyst who recently met the bank’s management.

“BofA would do itself and investors a great service if it gave greater clarity and details on the size and composition of its non-core assets.”

Other analysts confirmed that executives at BofA, which also bought the investment bank Merrill Lynch during the financial crisis, had spoken about more disclosure on non-core assets.

Other analysts confirmed that executives at BofA, which also bought the investment bank Merrill Lynch during the financial crisis, had spoken about more disclosure on non-core assets.

BofA’s plans go beyond previous announcements that designated assets such as the Balboa credit insurance arm and its stake in the asset manager BlackRock as non-core.

However, BofA is unlikely to go as far as Citigroup, which has assigned executives to manage and sell non-core assets and provides investors with a quarterly income statement for the portfolio, analysts said.

As part of its agreement to repay bail-out funds from the US government during the crisis, BofA pledged to add $ 3billion in equity through asset sales.

BofA has already sold some businesses, including shares in Brazil’s Itau Unibanco, MasterCard and Grupo Financiero Santander.

By the end of the second quarter, the bank had reaped $10 billion in gross proceeds from the sales and $1.9 billion in after-tax gains that it can apply towards the $3 billion mandate.

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