Bank of America NYSE:BAC stock outlook september 2011

Bank of America NYSE:BAC stock outlook september 2011 : Investors have pummeled the banks' stock in recent weeks on fears it may need to raise outside capital to absorb losses, Moynihan announced the 3,500 cuts in a memo to staff on Thursday.



Bank of America Corp plans to cut 3,500 jobs in the next few weeks as CEO Brian Moynihan tries to come to grips with the bank's $1 trillion pile of problem home mortgages.



The job cuts, which the Wall Street Journal said could rise to 10,000 in coming months, follows a series of quarterly losses over the past two years by the biggest U.S. bank, including a record loss of $8.8 billion in the latest quarter.



The job cuts are expected to be supplemented by additional cost-cutting in future quarters as part of a previously announced expense control program known as New BAC -- a reference to the bank's stock ticker.



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With little new loan growth and customers hoarding cash, U.S. banks' demand for deposits has declined from the heights of the housing boom when new deposits were necessary to fuel exploding loan growth.



Bank of America has gradually cut back its branch network from more than 6,000 branches to roughly 5,800.



Bank of America accumulated total noninterest expenses of $43 billion in the first six months of 2011, up 23 percent from the comparable 2010 period. Compensation accounted for 44 percent of the expenses this year.



The bank's second-quarter loss of $8.8 billion, its worst ever, included plans to pay $8.5 billion to settle a lawsuit from mortgage securities investors. However, other investors are contesting the settlement.



Bank stocks worldwide have been under pressure in recent days. Option traders on Thursday zeroed in on European bank stocks as well as on Bank of America and Citigroup. More than 71,000 November $4 puts on BofA changed hands, giving holders the right to sell the stock at a little more than half its current price.



Shares of the bank, which traded above $15 in January, were down 3 cents at $6.98 in midday trading Friday on the New York Stock Exchange.