Bank of America Stock Update: Bank of America Stock: Bank of U.S.A. Stocks plunged twenty% on Monday following the news that the USA International Group (AIG) insurance is suing it for billions of dollars over alleged mortgage fraud. A Fortune five hundred company, Bank of U.S.A. is America greatest bank. It dropped more than twenty% while shares of AIG fell 10% on Mon. This year, Bank of U.S.A. has already lost nearly forty-nine% of its value, while AIG has depreciated more than fifty-nine%.
Atlantic Equities’ Richard Staite said that the slump in Bank of U.S.A.s stock is being triggered by more than just the AIG news. It’s part of a broader market selloff that took other banking stocks down with it. He added that investors are losing confidence in Bank of U.S.A. causing its stocks to decline significantly. Furthermore, the credit default swaps (CDS) tied to its debt was at their peak level since May 2009.
Credit default swaps reflect the interest rates that Bank of United States has to pay to borrow Currency. If they keep rising, Staite said it would exacerbate investor concerns about whether the company has sufficiency liquidity to run its business.Bank of America Stock.
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