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BULLETIN: Bank of America Corp. Exiting Auto Leasing and Subprime Real Estate Businesses Aug 01
Standard & Poors, Aug 2001
Abstract
Bank of America Corp. (A+/Stable/A-1) announced today that it is exiting its auto leasing and subprime residential real estate lending businesses. Although the company will incur a $1.7 billion pretax charge in third-quarter 2001, it will benefit, over the longer term, from an improvement in loan quality, a lower volatility of earnings, and a stronger balance sheet (reflecting more conservative asset valuations). Standard & Poor's ratings on Bank of America incorporate the possibility of asset quality deterioration and restructuring or exiting of business lines in which the risks outweigh the rewards. The company will immediately cease originating auto leases and subprime mortgages. The existing $9.7 billion auto lease portfolio will gradually run off over the next 3-4 years. The subprime...
Companies mentioned in this report are: Bank of America Corp.
Action: S&P Event
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research type: News
This product is a is a brief one-page announcement of no more than 500 words with a quote from the analyst. It is media and investor focused with no accompanying commentary article.
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