Bank of America, meanwhile, has paid more than $50 billion in mortgage-related legal fees to settle disputes made against its subsidiary Countrywide, which it acquired just before the financial crisis. These settlements caused the bank’s fourth quarter earnings to shrink to 3 cents per share. However, analyst expectations were for only 2 cents per share. Revenues fell by more than 25% from the year-ago period. Despite the earnings beat, Bank of America’s shares are still at a fraction of what they were before the financial crisis. Bank of America has barely been profitable over the last year and its dividend is still a token payout.
Wells Fargo Stands Above the Rest
Even more positively for Wells Fargo, the bank raised its dividend in late January. The company increased its payout 16% and the raise reflects the company’s confidence in its performance as well as its commitment to returning cash to shareholders. At its current level of $1.00 per share, the dividend yields almost 3% at recent prices. Wells Fargo provides more stability and reliable financial results than its peers, and appears to be in a much better position to provide shareholders compelling returns going forward.
The article My Favorite Bank Stock for 2013 originally appeared on Fool.com and is written by Robert Ciura.
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