Not only the banks in Europe are facing difficulties by falling 8.4% on Friday. Bank of America is facing difficulties as well. It goes hands in hands the European financial market especially in German DAX index fell from 5.28% to 5.246%. Royal bank of Scotland fell 12% and Deutsche Bank fell around 6%.
In order to help with the situation, Bank of America is trying to reduce 3,500 jobs and to layoff 10,000 employees in the near future.
If this condition get worse the FED offers many options one of them is to issue separate class of shares tied with Merrill Lynch securities unit which managements at the bank already took that offer. Since they bought Merrill Lynch in 2009 and are now their most profit category. Also Bank of America sold half of their stocks at $3.3 billions to a bank in China. They are trying to do as many things they can in order to survive.
Even though Warren Buffet bought Bank of America stock at $5 billion this didn’t help with Bank of America financial situations since the stocks haven’t been paid off yet.
Bank of America have losses three out of six quarters since 2010 with $8.8 billions lose during Quarter 2 of this year. If Bank of America fail this will cause many consequences around the world.
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