BofA Doesn't Need New Capital: CEO in Davos
Web Producer, CNBC.com
Bank of America does not need to raise fresh capital to comply with the new regulations shaping the financial world and the quality of its credit portfolios is getting better, CEO Brian Moynihan told CNBC Friday in an interview from Davos, Switzerland.
A week ago, Bank of America reported a quarterly loss, hit by writedowns in its mortgage business.
The bank posted a fourth quarter shareholder loss of 16 cents a share in the fourth quarter, compared with analysts' expectations of a profit of 14 cents a share.
"We’re very optimistic about the franchise going forward," Moynihan said.
>> Click here to watch the full interview.
In anticipation of the new regulations, such as the Dodd-Frank financial reform legislation in the US and the Basel III international rules, the bank has raised $50 billion, he added.
"We have the capital to run our company … we have a clear path to follow these rules and not have to raise capital," he said.
The credit quality of the portfolio has improved and, overall, "the credit quality issue is behind the company and behind the US," Moynihan said.
"What's left to do is to work through the housing problems in the US," he said.
"Overall, (housing) prices kind of bump around and it will take a few more years to get through this," Moynihan added.
On the issue of unemployment in the US, he said the current elevated figures are caused by those who have been out of a job for a long time and not by newcomers, which is a good sign for the quality of credit portfolios.