Nomura Calls Buffett BofA's (BAC) "White Knight"

Nomura Securities' bank analyst Glenn Schorr said Warren Buffett is Bank of America's (NYSE: BAC) "White Knight" after his Berkshire Hathaway invested $5 billion in embattled bank.

Schorr said the injection will "dampen the heightened volatility in recent trading of BAC stock and its CDS, and we think it is a clear vote of confidence for the stability of Bank of America's franchise."

Schorr said he assumes regulators have approved this investment and importantly are comfortable with the investment in preferred stock as opposed to injection of common. "We think this underscores Bank of America’s ability to meet the prescribed Basel minimum capital requirements via organic capital generation and continued reduction of non-core assets."

He continues to JPMorgan (NYSE: JPM) and Citigroup (NYSE: C), but said the news is a clear positive for the entire group.

Schorr rates BofA at Neutral with an $11 price target.

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 $6.99 yesterday.

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