CEO: BofA Moves Salespeople to Modify Mortgages

Tuesday, 07 Dec 2010 02:03 PM

 

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink
Bank of America Corp., the largest U.S. lender by assets, said the reassignment of salespeople to modify mortgages for struggling borrowers may pressure revenue.

“We have recently moved a couple more thousand people from our sales side, our centralized sales group, over to our servicing areas,” Chief Executive Officer Brian T. Moynihan said at an investor conference today. “In addition, we continue to hire externally. Thereby we have elevated costs in this platform. These costs will stay elevated for the next several quarters and may impact our market-share momentum.”

Bank of America modified about 25,000 home loans in October, a 52 percent increase from the previous month, the Charlotte, North Carolina-based company said Nov. 18. A U.S. unemployment rate near 10 percent is forcing borrowers to miss payments, and regulators pressured lenders to minimize foreclosures.

“If the borrower qualifies for either a private modification or a government modification, then we complete that,” Moynihan said. When that’s not possible, the bank forecloses. “All of this work is requiring more associates, more teammates,” he said.

The bank has posted three unprofitable quarters since the beginning of 2009 as new regulations pressured fee income and borrowers fell behind on loans. The company, which cut its quarterly dividend to a penny a share in 2009, will boost the payout “as fast as we can,” Moynihan said today.

“I don’t see anything that would stop us,” Moynihan said, when asked if he could lift the payout next year.

The lender jumped 15 cents to $11.79 at 9:50 a.m. in New York Stock Exchange composite trading. The company has dropped about 22 percent this year.

© Copyright 2014 Bloomberg News. All rights reserved.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web
Join the Newsmax Community
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Retype Email:
Country
Zip Code:
 
You May Also Like
Around the Web
Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved