Boston, MA 04/15/2014 (wallstreetpr) – Bank of America Corp (NYSE:BAC) continues to lose money through settlement of its questionable practices. The latest settlement of $772 million involves the bank’s irregular credit charges and misleading marketing pitches. The settlement comes hot on the heels of a $9.5 billion settlement with the Federal Housing Finance Agency over deceptive mortgage practices.
The fine details
However, investors should get the fine details about the latest settlement that involves penalty and refunds. First and foremost, the bank did not admit or deny the claims levied against it. Therefore, in choosing to make the settlement anyway, the company is simply trying to good to its customers as it seems to value good customer relationship.
Moreover, out of the $772 million settlement amount, $727 million to be spent in refunds to consumers, $20 million will be paid to the Consumer Finance Protection Bureau (CFPB), and $25 million will go to the Office of the Controller of the Currency.
CFPB, the bank regulator, aims to protect the interest of consumers in the banking industry.
Costly issues
Coming to suffer the $772 million settlement was as a result of Bank of America Corp (NYSE:BAC)’s alleged sale of credit protection solution that customers never needed. The financial giant was accused of running both illegal billing and deceptive marketing. Such accusations cut deep into the company’s reputation at a time when it is trying to polish its image and shore up the balance sheet following the costly mortgage settlements.
A turnaround
Bank of America Corp (NYSE:BAC) is aggressively managing its turnaround. The company can be seen focusing more on investment banking operations where its executives believe that the company stands the best chance of success. At the same time, the bank is trying to limit its exposure to commodity and government debts that have increasingly become lackluster in recent times.
All in all, as much as the series of settlements that Bank of America is making have a financial impact on its balance sheet, they are expected to rid the company of troubles so that it can face the future with undivided attention towards growth.
