Silvester17 

I bought some today...

Mike

Big Mike 

What would a failure of a TBTF bank look like? A bank with a trillion in deposits... and tens of trillions of derivatives... I'm just trying to understand how the collapse would take shape, or more accurately the fall out. Do you really think there would be another bail out? In recent interviews/press statements, politicians are quick to reframe the 2008 bailouts as necessary to prevent an utter collapse of our economy. So would this excuse be used again to rush in and save BofA? Would they split it up, and try to get Citi, Wells, Chase etc to take huge risk-free government backed stakes? Those banks are already TBTF, now they are too bigger to fail, even more than already, if such a thing were to happen. No one can really acquire the assets or debt of BofA. That is my point. The only remaining possibility is for the entire bank to collapse into oblivion, or for the government to bail them out. And who is next? Mike

It's a pretty massive event to say the least. I don't think a bailout like we had before would be accepted politically. What I "think" would happen is a pre-packed bankruptcy situation but like you said, who can buy those assets? Maybe China or some other foreign buyer with deep pockets... I could see some sweetheart deal coming together for the right buyer as well. The true problem is still there though with the derivatives situation. I just think the Fed, Treasury and FDIC are going to have to decide whether or not to just let it happen and support the banks that have stayed out of this for the most part (smaller regional banks). But once BAC goes, more TBTF's will certainly follow.

Goldman has some of the biggest EU exposure, BNP Paribas is very suspect among the EU banks, Morgan Stanley is right there, Citi no better and the biggest whale of them all JPM has the largest derivatives exposure out there. This could blow up far greater than imaginable. Nothing was solved in 2008-2009 and it's come back even bigger this time which many knew it would. I wouldn't be surprised to find the Fed is already planning for this event. There's a $200 - $300 trillion time bomb counting down and they're trying to figure to either try and disable it or take cover. The Fed can't just print to cover it. It's just too much money. The USD would become completely worthless and there would be chaos in the streets.

papa15 

Well, BAC holds my mortgage....if they go under, maybe I could skip a payment or two until some other group picks up the pieces....

Unless your mortgage is portfolio'd within the bank, they're most likely just the servicer and your mortgage was securitized and sold to a 3rd party investor. To have your mortgage portfolio'd, you'd probably need to have a mortgage of $1 million or more. If they were to fail though, who knows what happens to their servicing unit. Pretty interesting to think about.

Private Banker 

Unless your mortgage is portfolio'd within the bank, they're most likely just the servicer and your mortgage was securitized and sold to a 3rd party investor. To have your mortgage portfolio'd, you'd probably need to have a mortgage of $1 million or more. If they were to fail though, who knows what happens to their servicing unit. Pretty interesting to think about.

MERS is pretty efficient and my guess is you would still be in default and I am sure it was made in gest.

To me this is more psychological than anything else. I think most interesting is that this is happening again in an election year! I wonder if there is some statistical info that says election years are Armageddon years!

I believe it best for us to push part of the problem down the line and take little poison pills as they come. Of course that is for the masses, and would devalue our currency (against who at this point as we are all bad!!) and our standing (again, we are all suffering except the BRIC's etc.?).

Letting BAC fail would be a huge problem and in my opinion not a step in a good direction. I think ripping it apart would cause even more drama but needs to be done. GS can burn in hell for all I care... haha...

I think now is a good time to buy some LEAP's (calls) maybe. I wonder what those are going for...

bluemele 

MERS is pretty efficient and my guess is you would still be in default and I am sure it was made in gest. To me this is more psychological than anything else. I think most interesting is that this is happening again in an election year! I wonder if there is some statistical info that says election years are Armageddon years! I believe it best for us to push part of the problem down the line and take little poison pills as they come. Of course that is for the masses, and would devalue our currency (against who at this point as we are all bad!!) and our standing (again, we are all suffering except the BRIC's etc.?). Letting BAC fail would be a huge problem and in my opinion not a step in a good direction. I think ripping it apart would cause even more drama but needs to be done. GS can burn in hell for all I care... haha... I think now is a good time to buy some LEAP's (calls) maybe. I wonder what those are going for...

Yeah, I hear Linda Green over at MERS has been literally all over the default situation. Lol!!! Just kidding. The borrower would definitely be in default there.

You're interested in buying some calls on BAC? Who knows maybe it would work out if BAC is bailed out again but the likelihood of that happening seems pretty slim. I really think a pre-packaged BK of some kind is what's in store. Either way shareholder equity would be wiped out. At this point, even depositors could be wiped out, lol.

Private Banker 

Yeah, I hear Linda Green over at MERS has been literally all over the default situation. Lol!!! Just kidding. The borrower would definitely be in default there. You're interested in buying some calls on BAC? Who knows maybe it would work out if BAC is bailed out again but the likelihood of that happening seems pretty slim. I really think a pre-packaged BK of some kind is what's in store. Either way shareholder equity would be wiped out. At this point, even depositors could be wiped out, lol.

Yes, they are good at making sure they notify the credit agencies when you default and everyone else on your block as well. haha

I think MERS is a great concept though, and glad to see it survived. I couldn't imagine doing it the old way because here in Hawaii it would be even more jacked up at the Bureau of Conveyances!

That is why I would buy calls, as at least I know my loss in advance! There are a lot of shareholders in BAC. I guess I just can't get my head around the filing (BK).

ZeroHedge reporting BofA is restructuring:

Bank Of America Is Restructuring Its Retail Bank Division - Full Memo | ZeroHedge

Quoting 

Any internal memo that is distributed on the last day of the week, and intercepted by American Banker at 5pm on a Friday, must surely be a portent of many good news for the bank which recently added a few trillion in derivative "assets" to match its OpCo deposit pool "liability". We can only hope that as a result of the restructuring, the company's retail banking website will no longer mysteriously crash following announcements of gratuitous debit card fees. Then again, any BofA announcement that has the following sentence in it, "remember, we have the best franchise, capabilities, and customer base in the industry" confirms that the level of mass delusion is unfixable, and that the website will most certainly be the first to go once the bank's $1 trillion in deposits realize they are the first line of defense to just a few extra trillion in derivative contracts. Message from David Darnell, Co-Chief Operating Officer Today I am announcing additional changes to Consumer and Small Business Banking and Home Loans, and how we serve our customers. These changes are consistent with our goals to streamline our company, make us more efficient and effective, and align to our customer-centered strategy. The changes also better position us in continuing to accelerate our strategy while implementing ideas from phase one of New BAC. It is critical to deliver a seamless experience to the Retail, Preferred and Small Business customers across all products and services. Central to that effort is integrating the Home Loans and Consumer and Small Business Banking organizations. As you have heard many times, no customer thinks of us as individual business units. They rightly think of us as Bank of America. Our strategy has not changed: Customer teams will define what our customers want and need. Products teams will build the right product solutions to meet those needs. Distribution and service teams will deliver to our customers, providing the ability for them to choose how and when they want to bank with us. As we focus on the critical day-to-day activities of running our organization, we also need to make sure the New BAC ideas are executed across the entire organization while managing risk, maintaining business continuity and optimizing our business model. Remember, we have the best franchise, capabilities, and customer base in the industry. To drive out the strategy of the combined organization I have asked the following leaders to take on these roles reporting to me effective immediately: Katy Knox will lead the newly combined Retail Banking and Distribution organization which serves 42 million retail households and provides end-to-end delivery through banking centers, online & mobile and ATM/VTM. Dean Athanasia leads the Preferred and Small Business Banking organization which serves 8 million preferred households and 4 million small business clients and will now include home loans sales. The Client Development Group and Small Business will combine to provide end-to-end accountability for our Small Business customers. Susan Faulkner continues to lead Consumer and Small Business Products with the addition of home loans products, secured credit underwriting, fulfillment and quality control. Tim Huval will assume responsibility for consumer Service & Operations consolidating all of the call centers, fraud, claims, and customer experience functions from Consumer and Small Business Banking & Home Loans. Laurie Readhead will assume responsibility for Consumer Market and Distribution Optimization focusing on driving out the New BAC ideas across the consumer organization while managing announced divestitures. Walter Elcock will assume accountability for consumer Business Controls and Readiness Management including oversight across consumer for vendor management, operational controls and issue management, business continuity, associate & community impacts related to New BAC and California / Northwest conversion. Barbara Desoer will continue supporting the Home Loans transition and the integration with Consumer and Small Business Banking. Collectively, these leaders are responsible for making it easier for our customers and clients to do business with Bank of America, to empower our employees to deliver for our customers and for our businesses to achieve strong financial results. Other organizational moves that continue to align our capabilities across the enterprise: Josh Adler and the Secondary Marketing team from Home Loans will now report into Walter Muller (Chief Investment Officer) within the Chief Financial Officer Group. Tom Halloran and the Preferred and Small Business Banking Solutions team will now align to Andy Sieg (Global Wealth & Retirement Solutions) within Global Wealth & Investment Management. The leadership team would like to announce the following leaders in their organizations: Reporting to Katy Knox in Retail Banking and Distribution: Curtis Anderson - Banking Center Channel Central Region, Anderson was most recently the GCB Central Region Credit Products executive Ann Balthis - Sales & Service Planning and Execution Anjali Besley - Banking Center Channel Southeast Region Kevin Dolan - Banking Center Channel Northeast Region David Owen - Online & Mobile, ATM / VTM Dena Roten - Retail Operations, Capacity & Controls Andy Rowe - Retail Banking Strategy & Solutions Barry Simmons - Banking Center Channel West Region Reporting to Dean Athanasia in Preferred and Small Business Banking: Jill Calabrese Bain - Strategy, Planning & Enterprise Solutions Robb Hilson - Small Business & Client Development Group Aron Levine - Preferred Business Sales, Levine was most recently a New BAC Catalyst for Global Wealth & Investment Management Alok Prasad - Merrill Edge Matt Vernon - Home Loans Sales Reporting to Susan Faulkner in Consumer and Small Business Products: Mark Brucker - Secured Credit, Underwriting & Fulfillment, Quality Control Joe Claricurzio - Unsecured Collections & Recovery and Financial Protection Services Titi Cole - Retail Products Rob Habgood - Unsecured Credit & Underwriting Mary Kanaga - Home Loans Business Enablement and Supplier Management Bob Kelly - Business Controls & Integration, Kelly was most recently CSBB Operational Risk and Governance Executive for CSBB Risk Lynn Kuttruff - Small Business Products Chip Rossi - Preferred Products TBD - Product Operations & Card Network Management Reporting to Tim Huval in Service & Operations: Mike Adornetto - US Customer Service Contact Centers, Adornetto was most recently a New BAC Catalyst from Global Technology & Operations Jennifer Ehresman - Global Service Management, offshore delivery Allen Jones - Consumer Customer Experience Randall King - Contact Center and Service Operations Terry Schappert - Claims Bob Shiflet - Fraud Mark Ulmer - Home Loans Post Closing and Centralized Services Sandy Wood - Home Loans Closing Services Reporting to Laurie Readhead in Consumer Market and Distribution Optimization: Rob Aulebach - Market Optimization Joe Helweg - Cost Optimization Tom Williams - Correspondent Lending TBD - Non-Core Portfolio Assets Walter Elcock will announce his organization at a later time. This leadership team will work together to continue building out the rest of the organization over the coming months.

Mike

Big Mike 

ZeroHedge reporting BofA is restructuring: Bank Of America Is Restructuring Its Retail Bank Division - Full Memo | ZeroHedge Mike

Wow, good find! One thing I know all too well from that business world lingo is these restructuring announcements lead to mass layoffs in the referenced divisions. Additionally, it confirms just how bad things are there at BofA. I remember in 2008 when things were getting bad, I read all sorts of restructuring announcements from BofA as well. I also think these announcements are simply diversions to something far worse occurring.

BAC is no longer the biggest bank in the US.

Source: Bank of America Loses Title as Biggest in U.S. - NYTimes.com

Quoting 

Bank of America, with $2.22 trillion in assets reported Tuesday in its third-quarter earnings, is now second to JPMorgan Chase, which has $2.29 trillion assets. It also ranks second to JPMorgan Chase in terms of branches and total deposits.

Mike