Bank Of America Is Doing Fine
The US economy is "healthy but slowing," Brian Moynihan said Tuesday, while unveiling a set of Q3 results which looked ok at face value.
Bank of America's earnings releases tend to be somewhat bland, consistent with Moynihan's deliberately uninteresting "responsible growth" corporate strategy.
Ahead of the Q3 numbers, there was some focus on the bank's unrealized bond losses and, more to the point, on the stock's underperformance, which some attribute in part to investors' annoyance with a mou
I was all set to point out that Wells Fargo’s savings account rates are even worse. They’ve been under a FED mandated asset cap since 2018 on account of their myriad (and seemingly never ending) scandals. As such, they’re actively disincentivized from acquiring new deposits.
Lest I fake the funk on the nasty dunk though, I quickly googled BofA to compare and… I’ll be damned. BofA is lower. Bank of America offers lower interest rates on savings accounts (0.04% on the highest tier for those who are curious) than a bank that is forbidden by regulatory agencies from growing assets (0.25% for starting balances, growing to 1.0% when you reach 6 figures, and 2.5% for seven figures). I am honestly impressed.
Anecdotally, a few of our clients have finally noticed just how paltry the yields are at BOA, including one who called the bank was told they were a “preferred client” so were earning .025%. They are pulling money and moving it into MMFs.
The migration out of bank deposits is happening slowly, but it has not stopped or reversed by any means.