Malfunctioning Web Site Compounds Company's Problems
It's not a very good time to be a Bank of America shareholder right now (or employee, for that matter).
The stock is currently trading at $5.83, which is right near its 52 week low of $5.81. The stock is in real danger of falling to levels not seen since the financial crisis of 2008/early 2009.
Bank of America is currently trying to work its way through a raft of issues, both specific to itself and as part of the banking industry as a whole.
The company has had to deal in recent days with legions of angry customers who are extremely unhappy about the company's plans to implement a $5/month debit card usage fee in 2012. Bank of America is looking for new ways to generate fees, and this particular idea is being very negatively received by the general public. Many credit unions are noticing an uptick in new account openings as angry BAC customers move their accounts elsewhere.
As if that weren't bad enough, Bank of America's website (bankofamerica.com) has been plagued with issues over the past couple of days. The company claimed that they had fixed the problem on Sunday, but issues persisted earlier this morning. Website outage? Not exactly the best way to follow up an announcement that infuriated a large percentage of your customer base.
Bank of America is also getting taken down thanks to concerns over exposure to Europe, the expected costs of mortgage-related litigation and a raft of other issues. The entire banking sector, including Morgan Stanley and Bank of America, have been taking it on the chin as investors worry about their exposure to Europe. It also doesn't help, of course, that the United States is either about to tip into a recession, or is already there.
Over the past few years, Bank of America has gone from pariah to darling back to pariah. It wasn't that long ago when practically every major hedge fund in the world was long to the hilt on Bank of America - those days are long gone, and the stock is free-falling despite a recent $5 billion investment from Warren Buffett.
Europe. The struggling US economy. Legions of angry customers. Website issues. The potential for another credit crisis. Mortgage-related litigation. Greater regulation. Plummeting share prices.
It's not a good time to be a BAC shareholder right now. Having said that, at least be glad that you aren't a Bank of America teller or customer service representative at this point - I imagine that these people are living their own personal hells right now as they deal with mobs of pissed off Bank of America customers.
Filed under: General Knowledge