UPDATE 2-Bank of America loan losses "horrific" -Bove
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June 15 (Reuters) - Bank of America Corp (BAC.N: Cotización) is experiencing "horrific" loan losses and may set aside $46 billion in loan loss provisions this year, analyst Richard Bove said, even as he raised his target on the stock by $5 to $19.
Shares of the largest U.S. bank slid 3 percent to $13.31 in early morning trading on the New York Stock Exchange.
"In the second quarter, (Bank of America's) position as the largest lender in multiple sectors of the American financial system will haunt the company as its losses expand," the Rochdale Securities analyst said.
However, Bove said he expects the price-earnings multiple on the stock to rise as confidence in the company and its management improved.
He continues to rate the stock "buy."
Bove said it was becoming increasingly clear that Bank of America's acquisition of Countrywide and Merrill Lynch has been good for the company.
These two businesses may have provided the bulk of the company's positive results in the current quarter as the core business continues to suffer due to its poor underwriting practices, he said.
Bank of America, which has taken $45 billion from the U.S. government's Troubled Asset Relief Program, has indicated it would like to begin repaying its infusion this year. Continuación...