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SUSTAINABILITY- HOW IS BANK OF AMERICA FARING?

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  Sustainability has become a buzz word among the organizations now with most of the organizations trying to set up their sustainable development goals as a part of the organizational goals (Rafi, Why sustainability is crucial for corporate strategy ) . Sustainability has become increasingly crucial for the organization to remain relevant and competitive in the market. It may require organizations to make changes in they way they operate like digital transformation. Sustainability for organization has 3 pillars which are a) Environmental b) Social c) Governance .   Why is it important for Organizations? Implementing sustainability for the organization have proven to attract top talent, reduce costs and improve the profits for the firm. Firms also face pressure from stakeholders such as investors, regulators, and consumers to implement sustainability in their corporate strategy (Rafi, Why sustainability is crucial for corporate strategy ) . Sustainability strategy motivate organiz

A STUDY OF NON-PERFORMING LOANS OF BANK OF AMERICA

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  ( Non-performing loan (NPL) 2022) A Non-performing loan is a loan in which the borrower has defaulted the monthly principal and interest payments for a specific period. This happens when the borrower does not have enough money to make repayments or gets into a situation which makes it difficult for them to continue with the repayment towards the loan. Generally, loans are classified as non-performing loans when more than 90 days have been passed with borrower not paying the agreed interest or instalments. However, when the borrower starts repaying the loan that has been classified as non-performing loan, non-performing loans become a re-performing loans. Why are Non-performing loans (NPL) a problem for the bank? They impact the banks in the following ways (Bank, What are non-performing loans (npls)? 2021) : ·          NPL curtail the profitability of banks because they generate losses which reduces the bank’s earnings from their credit business. ·          To prepare for thes

ANALYZING THE FINANCIAL PERFORMANCE OF BANK OF AMERICA WITH THE HELP OF FEW RATIOS

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  It is important for an investor to analyze the financial performance of an organization as it provides a snapshot of firm’s health and provides insight into future. Financial performance can be assessed with the help of key performance indicators such as Gross profit margin, net profit margin, etc. Results of such analysis can help the investor to take decision whether or not to invest in the firm. Banks have unique characteristics from other firms. Hence, it is more practical to assess the financial performance of banks based on below mentioned indicators  (Blokhin, 2023) .  Efficiency ratio Price to earnings ratio Loan to deposit ratio     Let us analyze the financial performance of BOA from 2019 to 2022 based on the above indicators.       Efficiency Ratio Expense and Income figures  ( Annual reports & proxy statements )   2019 (In million) 2020 (In million) 2021 (In million) 2022 (In million) Non-Interest ex

RISK MANAGEMENT STRATEGIES ADOPTED BY BANK OF AMERICA

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  ABOUT Bank of America which is serving more than 10% of all American bank deposits is headquartered in Charlotte, North Carolina  ( Bank of America 2023) . It was formed by Nation’s bank acquisition of Bank of America in 1998. Bank of America holds a market share of 17.8% in United States as of June 2022 and is serving approximately 67 million consumer and small business clients. MAJOR DIVISIONS OF THE BANK HOW DOES BANK OF AMERICA MANAGE THEIR RISKS Risk is inevitable for any organization. Like any organization, banks are also susceptible to various risks and firm can never grow without taking risks. Some of the risks which Bank of America face are  ( Annual reports & proxy statements ) : : RISK MANAGEMENT Liquidity Risk   The Asset and Liability Committee of the bank is in charge of framing the bank’s liquidity strategy ( Annual reports & proxy statements ). The corporate treasury team is responsible for devising and administering banks funding strategies and