Bank of America Deserves Blame for Its Financial Crisis Meltdown

Who's to blame for Bank of America's (NYSE: BAC  ) epic meltdown following the financial crisis? Analysts and commentators like to blame it on Countrywide Financial, a once-leading mortgage originator that Bank of America acquired in 2008. But is this letting Bank of America off the hook?

While it's certainly true that Countrywide has cost the nation's second largest bank by assets tens of billions of dollars, what's also true is that Bank of America's own operations prior to the financial crisis are just as responsible for its current condition. More specifically, the single-biggest culprit behind the bank's ongoing travails was its own credit card division.

As Motley Fool contributor John Maxfield discusses in the video below, losses from credit cards alone cost Bank of America more than $60 billion in the years between 2008 and 2010. By even the most liberal estimates, this is at least on par with a final tally of the bank's Countrywide-induced mortgage losses.

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Read/Post Comments (6) | Recommend This Article (4)

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  • Report this Comment On July 06, 2014, at 3:20 PM, Rifleman3006 wrote:

    John, your articles are so old, same bashing and bashing, must be sad to have such bitter feelings towards the big bad bank. Guess they stepped on you at one point, get over it.

  • Report this Comment On July 06, 2014, at 3:55 PM, multi007 wrote:

    {yawn} oh please... another boring article bashing BAC... How about giving them an award for helping save the economy? The fed said "we need you to buy country wide, or else." The fed said "You need to take money from us, or else". From Clinton to Bush, the fed said "you need to lend money to poor people who cant afford to buy a home".

    They helped the economy by buying Country Wide.

    They helped the economy by lending to people who stopped paying their bills.

    They helped the economy by taking money from the fed to show that the banks were "strong".

    These types of articles are boring, plain and simple.

  • Report this Comment On July 07, 2014, at 12:02 AM, sluggo47 wrote:

    Dear John,

    This space is too small to refute all of you points but I will say that you will not only soon be proven to be a Motley Fool but soon be proven to be a Real Fool.

  • Report this Comment On July 07, 2014, at 12:03 AM, sluggo47 wrote:

    Pure Fluff piece.

  • Report this Comment On July 07, 2014, at 5:52 AM, funfundvierzig wrote:

    Biggest over-powering factor in the meltdown of Bank of America:

    The malmanagement and mismanagement by corrupt, grossly over-paid executives and derelict Directors embracing a culture of lawlessness and brazen fraud.

    In the 21st century, Bilk of America achieved the distinction of becoming the leading American financial institution in fraud mongering. The price to suffering BAC shareholders? $60 billion in litigation, settlements, and fines with much more to be added to the tab soon!

    ...funfun..

  • Report this Comment On July 07, 2014, at 6:01 AM, funfundvierzig wrote:

    John Maxfield, a very insightful and well articulated analysis.

    Your review is a refreshing contrast to the Pollyannaish promotion by fanatical fans of Bank of America at various news and investor sites over the net, many of whom have disclosed connections with the Bank.

    ...funfun..

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