Money and Finance
- Links
Warren Buffett Takes 8% Stake in Sears Spinoff Seritage (LINK) Billionaire investor Warren Buffett has taken an 8.02% stake in Seritage Growth Properties Inc., the real-estate company split off from Sears Holdings Corp. earlier this year. Mr. Buffett...
- Buffett Says Banks Cleared Of Excess Risk Pose No Threat To U.s.
Thanks to Will for passing this along. Warren Buffett, the billionaire investor who oversees stakes in some of the largest U.S. banks, said the nation’s lenders have rebuilt capital to the point where they no longer pose a threat to the economy. “The...
- Goldman Sachs’s Trott Tells Jury Of Buffett Deal Secrecy
Byron Trott on the September 2008 Berkshire/Goldman deal. I guess it is also a good example of Warren Buffett sticking to his commitments and doing what he says he’ll do. Even if there are billions of dollars on the line, he promised the grandkids ice...
- Curse The Geniuses Who Gave Us Bank Of America - By Jonathan Weil
Ask anyone what the most immediate threats to the global financial system are, and the obvious answers would be the European sovereign-debt crisis and the off chance that the U.S. won’t raise its debt ceiling in time to avoid a default. Here’s one...
- Option Expiration And A New Option Position
It's time to get caught up on some option moves that have gone through in the past week or so. I had a call option get executed on January 18th and purchased 100 shares of Bank of America. Also last week I sold a call option on Halliburton. I'll...
Money and Finance
BofA Reaches Deal With Buffett on Preferred Stake
Link to article: BofA Reaches Deal With Buffett on Preferred Stake
Bank of America Corp. (BAC), the lender that turned to Warren Buffett in 2011 for a capital injection, reached a deal with the billionaire’s company to change terms so the investment is treated more favorably by regulators.
The amendment would allow the bank to count preferred shares with a $2.9 billion carrying value as Tier 1 capital, the Charlotte, North Carolina-based lender said in a filing with the U.S. Securities and Exchange Commission yesterday. The deal with Buffett’s Berkshire Hathaway Inc. (BRK/A) must be approved by the bank’s shareholders in a May vote, according to the filing.
The agreement will “benefit our Tier 1 capital and leverage ratios,” Bank of America said in the filing. “We do not expect any impact to our financial condition or results of operations as a result of this amendment.”
Bank of America Chief Executive Officer Brian T. Moynihan has been selling assets to simplify the company and prepare for tighter regulation. U.S. and international watchdogs are pushing lenders to hold more capital to prevent a repeat of the bailouts in the financial crisis. Tier 1 capital is a measurement of a bank’s ability to absorb losses.
The amendment would force Bank of America to wait at least five years from its approval to redeem the preferred stock. Under the 2011 deal, the bank was able to redeem the preferred stake at any time as long as it paid a 5 percent premium.
- Links
Warren Buffett Takes 8% Stake in Sears Spinoff Seritage (LINK) Billionaire investor Warren Buffett has taken an 8.02% stake in Seritage Growth Properties Inc., the real-estate company split off from Sears Holdings Corp. earlier this year. Mr. Buffett...
- Buffett Says Banks Cleared Of Excess Risk Pose No Threat To U.s.
Thanks to Will for passing this along. Warren Buffett, the billionaire investor who oversees stakes in some of the largest U.S. banks, said the nation’s lenders have rebuilt capital to the point where they no longer pose a threat to the economy. “The...
- Goldman Sachs’s Trott Tells Jury Of Buffett Deal Secrecy
Byron Trott on the September 2008 Berkshire/Goldman deal. I guess it is also a good example of Warren Buffett sticking to his commitments and doing what he says he’ll do. Even if there are billions of dollars on the line, he promised the grandkids ice...
- Curse The Geniuses Who Gave Us Bank Of America - By Jonathan Weil
Ask anyone what the most immediate threats to the global financial system are, and the obvious answers would be the European sovereign-debt crisis and the off chance that the U.S. won’t raise its debt ceiling in time to avoid a default. Here’s one...
- Option Expiration And A New Option Position
It's time to get caught up on some option moves that have gone through in the past week or so. I had a call option get executed on January 18th and purchased 100 shares of Bank of America. Also last week I sold a call option on Halliburton. I'll...