Bank of America shares finished down more than 10 percent as an afternoon conference call by CEO Brian Moynihan did little to reassure jittery investors.
“We believe our capital targets are the right targets to run our company,” Monynihan said.
The much-anticipated conference call was hosted by Fairholme Funds portfolio manager Bruce Berowitz. Bank of America is one of Fairholme’s top holdings.
Bank of America shares sank in early trading, dropping almost 9 percent in the first half hour. They rebounded in afternoon trading, popping briefly into positive territory for the day, before finishing sharply lower along with the rest of the financial sector.
“Can you really go forward and say you will do the same thing you’ve been doing? What you’ve been doing is not working. The market is not believing you,” Bartiromo said.
Moynihan replied that Bank of America would be able to restore its credibility by “continuing to do what we’re doing.”
Bank of America shares have led the financial sector lower in August.
After today's loss, they were down by 35 percent this month alone. The share price has been cut by more than half since the start of the year.
Berkowitz himself has been under fire for his positions in financial stocks. In addition to Bank of America, Fairholme has sizable positions in AIG , Goldman Sachs , and Citigroup.
Both Berkowitz and Moynihan seem to have hoped that the call would clear the air by giving Moynihan a chance to answer the critics of his leadership and the bank’s business and financial health. The press release announcing the call promised the Berkowitz would ask the toughest questions submitted to him by email in advance.
That strategy appears to neither be working or backfiring—it didn't move the needle.
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