Moynihan is committed to Merrill Lynch
BANK of America chief executive Brian Moynihan yesterday vowed to keep its investment bank Merrill Lynch as he defended his performance and strategy to the bank’s biggest shareholder.
Moynihan, who has come under fire for BofA Merrill Lynch’s recent share price falls, took the rare step of holding a conference call with Bruce Berkowitz of mutual fund Fairholme over the bank’s future.
Confidence in BofA has slumped as investors fear it faces billions of dollars of legal charges to settle multiple lawsuits related to its sale of subprime mortgages and mortgage-backed securities before the crisis.
Berkowitz quizzed Moynihan on whether BofA can afford to pay the charges, raise regulatory capital for Basel III and pay dividends.
Moynihan told more than 6,000 listeners he would sell non-core assets before considering Merrill. “When you have non-core assets to sell, why would you sell core assets?” he said.
He also ruled out further share sales, and sought to reassure listeners that the environment had improved since the recession.
“The fundamentals are so much better in our country and in our company and in our industry than they were four years ago,” he said.