Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Why Bank of America Corp (BAC) Tanked This Week

Page 1 of 2

Unless things change drastically in the next hour or so, it’s fair to say that shares in Bank of America Corp (NYSE:BAC) totally tanked this week, down 6.32% with about one hour left to go in the trading week. And B of A wasn’t the only big American bank to lose that lovin’ investor feeling.

Bank of America Corp (NYSE:BAC)The tale of the tickers
Here’s where some of the country’s biggest banks are ending up for the week:

  • Citigroup Inc. (NYSE:C) is down a hefty 4.83%.
  • JPMorgan Chase & Co. (NYSE:JPM) is down a much less hefty but still significant 2.43%.
  • Wells Fargo & Company (NYSE:WFC), if not exactly burning up the markets, is at least up 0.91% on the week.

The market overall didn’t fare much better:

  • The S&P 500 is down 1.86% on the week.
  • The Dow Jones Industrial Average is down 1.10%.
  • And the Nasdaq took the biggest hit of all the major indices: down 2.55%.

Except for Wells Fargo, no one did very well this week, but B of A clearly takes the cake in that department. What caused the superbank to super-tank?

A 71% pay hike and a wobbly Fed
The big news for B of A this week was a reported 71% pay hike for CEO Brian Moynihan. For 2011, his total pay package came to $7 million. For 2012, it will top $12 million: a base salary of $950,000 and restricted shares worth $11.1 million. The bank’s share price dropped 3.22% on that day alone — Wednesday, the day the pay package was announced.

So it’s fair to say that investors weren’t happy with the news. True, B of A did reward its shareholders handsomely in 2012. Anyone who owned shares on January 3, 2012 saw them double in value by the end of the year. But does that justify an extra $5 million dollars to one person, when the bank is so obviously still recovering from the misdeeds and missteps of the financial crisis?

Of course, the markets just seemed to be off in general this week, and maybe B of A more or less came along for the ride.

We did hear that the Federal Reserve is going wobbly on its commitment to QE3, the central bank’s latest round of quantitative easing. Markets did not react well to the notion that the Fed might shut the program down early out of fears of stoking inflation and a too-big balance sheet: Investors have gotten quite used to the notion of Ben Bernanke’s bottomless cash-cushion being there for moral support.

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!