Bank of America to buy back US$40 billion of shares in new programme
The announcement follows buyback plans from some of the biggest US banks after they passed this year’s US Federal Reserve stress tests
[NEW YORK] Bank of America announced a new US$40 billion stock-buyback programme, sending shares up.
The company’s board authorised the repurchases to begin when the current programme is completed on Aug 1, according to a statement on Wednesday (Jul 23). The new programme replaces the current US$25 billion authorisation announced a year ago, of which the firm had US$9.1 billion of capacity remaining as at the end of June.
The programme will continue providing “additional capital return flexibility, reflecting the company’s commitment to return to shareholders excess capital that is not needed to support economic growth, deliver for customers and communities, invest in the future and sustain strength and stability through the economic cycle”, Bank of America said in the statement.
Shares in Bank of America, up about 10 per cent so far this year, climbed about 1 per cent in late New York trading.
The announcement follows buyback plans from some of the biggest US banks after they passed this year’s US Federal Reserve stress tests.
JPMorgan Chase’s board authorised a US$50 billion share buyback, and Morgan Stanley reauthorised a multiyear share repurchase programme of as much as US$20 billion, they said earlier this month. BLOOMBERG
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