FBR Capital Downgrades Bank of America (BAC) to Market Perform

FREE Breaking News Alerts from StreetInsider.com!

BAC Hot Sheet

Rating Summary:
3 Buy, 14 Hold, 4 Sell

Rating Trend: Down

Down

Today's Overall Ratings:
Up: 16 | Down: 7 | New: 23

FBR Capital downgraded Bank of America (NYSE: BAC) from Outperform to Market Perform and lowers its price target form $18 to $15 following the Federal Reserve's objection to the company's comprehensive capital plan.

"We believe the $20B-$25B of additional capital needed to be compliant with the Basel III requirements, along with outstanding repurchase claims and lawsuits against the company, may have the Fed concerned about whether the company has the earnings power to be in compliance with the new capital requirements," the firm said. "We estimate the company may recognize an additional $6B-$8B of charges on top of current reserves for repurchase-related losses, but there are still many unknowns surrounding these claim."

In addition, possible lawsuit National Credit Union Association (NCUA) related to legacy MBS credit losses and the potential foreclosure settlement with state attorneys general present too many unknowns to be recommending the stock.

For more ratings news on Bank of America click here and for the rating history of Bank of America click here.

Shares of Bank of America closed at $13.65 yesterday, with a 52 week range of $10.91-$19.86.

Discover Wall Street's best ratings calls with the pros - Upgrade to Ratings Insider Elite. Free Trial!