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Fitch Ratings Downgrades Bank of America (BAC) Ratings
May 18, 2009 9:22 AM EDT

Fitch Ratings has downgraded various ratings of Bank of America Corporation (NYSE: BAC) and subsidiaries, reflecting concerns surrounding the headwinds that the company is facing over the near- to intermediate-term, both with regard to asset quality and capital needs.

Fitch notes that BofA is required to raise an additional $33.9 billion in common equity by early November 2009 as a result of the government stress tests. The say this is a "daunting task in any environment."

Fitch said, "Considering the meaningful uncertainty which surrounds both near-term credit costs and market conditions, Fitch believes there is a heightened level of execution risk in meeting the capital requirement, which, in turn, indicates a heightened level of performance risk for the various classes of hybrid capital securities. Management has outlined a plan to raise the mandated amount of common equity and has recently sold part of its stake in China Construction Bank as part of its efforts to accomplish this. However, success in reaching the goal requires market access, ability to arrange sales of other units at a sufficient price, and maintenance of earnings above SCAP projections. Fitch believes that near-term earnings may be the most difficult of these three factors."


LINK: http://www.streetinsider.com/Downgrades/Fitch+Ratings+Downgrades+Bank+of+America+%28BAC%29+Ratings/4661735.html