American International Group Inc (AIG), Bank of America Corp (BAC) Among Billionaire Louis Bacon’s Bank Bets

Citigroup Inc. (NYSE:C) is Bacon’s second largest holding. Although Citi’s 2012 revenue was down 10% year over year, its 4Q results showed positive signs. Loans were up 1.3% year over year for the quarter, and revenue up 3.3%. The bank also generated some $1.33 billion in income from continuing operations during 4Q 2012, which was up 34% year over year.

What’s more is that all its major geographical regions saw growth in operating income: North America up 121% year over year, Asia up 16%, Latin America up 16% and Europe, the Middle East and Asia up 6%.

Bank of America Corp (NYSE:BAC) was one of Bacon’s biggest increases last quarter, upping his stake 100% and now is his third largest holding. Bank of America and Citi took some of the biggest hits during the financial crisis, with both still down 68% (Bank of America) and 80% (Citi) over the last five years, compared to Wells Fargo & Co (NYSE:WFC), up 14%, and JPMorgan Chase & Co. (NYSE:JPM) up 3%, over the same time period.

By price to book standards, Bank of America Corp (NYSE:BAC) trades at only 0.6 times, versus the industry average of 1.1 times. The bank also has a rapidly improving balance sheet. At the end of last quarter, the company’s Tier 1 common capital ratio (Basel 1) was 11.06%, compared to 9.86% for the same quarter last year.

The bank also continues to show resilience as investors stick with the company; its up nearly 5% year to date despite fourth quarter results that showed revenue falling 20% and net income down 60% year over year.