UPDATE: Citi Downgrades Bank of America (BAC) to Neutral

Citi analyst Keith Horowitz downgraded Bank of America (NYSE: BAC) from Buy to Neutral with a price target of $40.00.

The analyst comments "We are downgrading BAC to Neutral from Buy. We are in a tricky period for bank stocks as NII tailwinds seem fully factored in, and we see downside risk to 2023 NII largely from a catch up on deposit repricing and noninterest bearing deposit outflows outweighing the benefits of fixed rate assets repricing. Credit risk remains a wildcard, which we believe will be better than feared, but it feels early to play the credit trade as we have yet to see meaningful deterioration; plus, we believe the regionals will be a better place to play. Also, we are cautious on capital return due to potential for increased capital requirements (see our DC note) and also note that BAC won’t benefit as much from lower OCI since it has largely hedged out its AFS book."

For an analyst ratings summary and ratings history on Bank of America click here. For more ratings news on Bank of America click here.

Shares of Bank of America closed at $38.41 yesterday.

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