Bank of America miscalculated it's capital for years

So why did it take the CEO so long to find it? After all, the reason CEO's make so much money is that they do such a good job and do all the hard work. [sarcasm]

http://www.bloomberg.com/news/2014-04-28/bofa-halts-buyback-dividend-increase-after-finding-plan-error.html

By Hugh Son 2014-04-28

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Bank of America Corp. fell the most since November 2012 after suspending plans for a dividend increase and $4 billion of share repurchases because of an error in its stress-test submission to the Federal Reserve.

The lender will resubmit its proposal after finding botched accounting on structured notes issued by Merrill Lynch, the Charlotte, North Carolina-based company said today in a statement. The stock tumbled 6.3 percent to $14.95 in New York, erasing a gain for 2014.

Chief Executive Officer Brian T. Moynihan had been set to quintuple the quarterly payout to 5 cents a share, five years after the second-biggest U.S. bank cut the dividend to a token amount during the financial crisis. Bank of America said its revised proposal probably will mean lower payouts than requested in its existing plan, which was already modified once to win Fed approval.

“Bank of America is by far not the first big bank to make a mistake in its CCAR submission,” David Hilder, an analyst at Drexel Hamilton LLC in New York, said in a phone interview, referring to the Fed’s Comprehensive Capital Analysis and Review. He said that while Bank of America noticed the error and probably has sufficient capital to cover the payout, the setback is “embarrassing” for the company.

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Bank of America discovered the mistake last week as it prepared its 10-Q quarterly regulatory filing and immediately notified the Fed, said a person with direct knowledge of the process. The error had gone undetected since the firm’s acquisition of Merrill Lynch in 2009, said the person, who requested anonymity because the information hasn’t been made public.

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Bank of America, led by Moynihan since 2010, has been working for years to resolve headaches inherited with the purchases under his predecessor of Merrill Lynch and mortgage-lender Countrywide Financial Corp. during the financial crisis. The company reported a $276 million deficit for the three months ended March 31, its fourth quarterly loss under Moynihan.

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http://www.bloomberg.com/news/2014-02-19/bofa-said-to-boost-ceo-s-compensation-17-to-14-million.html

By Hugh Son 2014-02-20

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Bank of America Corp. awarded Chief Executive Officer Brian T. Moynihan $14 million for last year, boosting his pay 17 percent after profit more than doubled.

Moynihan received $12.5 million in stock grants for 2013, the firm said yesterday in a filing to the U.S. Securities and Exchange Commission. He got no cash bonus for last year, and his $1.5 million salary will remain unchanged in 2014, said a person with direct knowledge of the matter who asked not to be named because the company hasn’t yet disclosed the CEO’s full package.

Moynihan, 54, has spent his four years atop the nation’s second-largest bank resolving disputes tied to shoddy home loans and foreclosures, most of them rooted in his predecessor’s 2008 takeover of Countrywide Financial Corp.

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Last year, the bank raised Moynihan’s salary to $1.5 million, effective that February, compared with $950,000 the three previous years.

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The board’s compensation committee is led by Monica C. Lozano, the CEO of Impremedia LLC, the Spanish-language news and information firm based in Brooklyn, New York.

[CEO's choosing each other's level of pay.]

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