S. Korea Wealth Fund Rumors On Bank of America (BAC) are Sketchy
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Shares of Bank of America (NYSE: BAC) are recovering off pre-open lows on speculation South Korea's sovereign wealth fund could raise its stake in the embattled U.S. bank.
While the news is a promising sign, its may not be all that it is cracked up to be.
For one, Korea Investment Corp is denying that a decision has been made. In fact the group told Reuters that is had yet to make a decision and would convene a meeting on Sept 28 on the matter. The second issue is that the investment would likely only be a reinvestment of its BofA dividend. We're talking millions not billions. Last month the fund said it e-invested $78 million in buying BofA shares this year, about half the dividends it had received since its initial investment.
While the news is a promising sign, its may not be all that it is cracked up to be.
For one, Korea Investment Corp is denying that a decision has been made. In fact the group told Reuters that is had yet to make a decision and would convene a meeting on Sept 28 on the matter. The second issue is that the investment would likely only be a reinvestment of its BofA dividend. We're talking millions not billions. Last month the fund said it e-invested $78 million in buying BofA shares this year, about half the dividends it had received since its initial investment.
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