After initially passing the Federal Reserve's recent round of stress tests and being granted the ability to raise its dividend and initiate a share repurchasing program, Bank of America (NYSE: BAC ) has now notified the Fed that it mistakenly reported $4 billion in additional capital. The bank will now be forced to suspend its planned increases to shareholder distributions.
In this segment from Tuesday's Investor Beat, host Alison Southwick and Motley Fool analysts Mike Olsen and Brendan Mathews look at how an error of this size could have happened, and just how badly this could damage the credibility of both the bank and the Fed's stress tests. Mike also mentions that this demonstrates just how many unknowns there truly are for investors in banks of this size.
Big banking's little $20.8 trillion secret
There's a brand-new company that's revolutionizing banking, and is poised to kill the hated traditional brick-and-mortar banks. That's bad for them, but great for investors. And amazingly, despite its rapid growth, this company is still flying under Wall Street's radar. To learn about about this company, click here to access our new special free report.