(07-06-2023, 03:57 PM)82 Card Wrote:(07-05-2023, 02:48 PM)Mick Wrote:(07-05-2023, 02:20 PM)washingtonismoney Wrote: BOA claims assets of $3.1 trillion; even if true a $100B loss is not terribly significant: https://www.macrotrends.net/stocks/chart...tal-assets
It's true, Bank of America does have $3.05 trillion of assets, but they also have 2.8 trillion in liabilities. Their net worth is $272 billion. So a $100 billion hit would be 36.8% of their net worth...quite substantial.
Not sure how those numbers relate to CET1 (total common equity ratio). As of August 2022, the FED required B of A to have a ratio of 10.4% (See: Large Bank Capital Requirements, August 2022 ).
Even if B of A is saved for now by accounting rules, seems like they are likely to face a need to raise additional capital if the trends continue, particularly if there is a sudden reversal of deposit flows to large banks.
You're prescient, 82 Card. BofA was just moved down a notch on the "too big to fail" list, dropping to category three on the Financial Stability Board (FSB -- not FASB) list.
Bank Of America Down A Notch On 'Too Big To Fail' List | Barron's
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