Bank of America Estimates Leverage Ratio Was 4.9% to 5% - Bloomberg

Bank of America Estimates Leverage Ratio Was 4.9% to 5% - Bloomberg


Bank of America Corp., the second-largest U.S. bank, estimated that its ratio of capital to total assets was between 4.9 percent and 5 percent in the second quarter, near the proposed minimum.
The bank disclosed the so-called supplementary leverage ratio with its second-quarter earnings today. The Charlotte, North Carolina-based bank didn’t estimate the ratio for its federally insured deposit-taking subsidiary.
Under the U.S. plan introduced last week, the parent companies of eight of the largest banks, including Bank of America, would need capital equal to 5 percent of assets and their bank subsidiaries would require 6 percent.
The U.S. proposal surpasses the 3 percent global minimum that the Basel Committee on Banking Supervision approved to help prevent another financial crisis. The changes would force lenders to fund more assets with capital that can absorb losses instead of with borrowed money.
The higher threshold could complicate efforts by Chief Executive Officer Brian T. Moynihan to increase dividends. Lenders that don’t reach the minimum in time could face curbs on bonuses, stock buybacks and payouts to shareholders. While banks would have until the end of 2017 to comply, some may have to retain earnings to meet the goals.
 
Licks finger, sticks it in the air. Hmmn. Yeah 4.9% sounds about right. CFO trundles back to office to log out and hop in his town car to head for the Hamptons.