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February 7th, 2009

Lewis Expresses Some Faith in BofA

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In a recent interview with CNBC’s Maria Bartiromo, Bank of America Chairman and CEO Ken Lewis told the news anchor that BofA would not need any more TARP funds. And, Lewis said, his company is working to pay the government back as soon as possible.

In a strong expression of faith, within the past two weeks Lewis has purchased approximately $2 million worth of BofA shares:

He also told employees in a memo that the bank’s board last week, “unanimously endorsed our business model, strategic direction and the team,” at its regular meeting on Jan. 28.

The moves are Lewis’ latest effort to convince employees, investors and the board that he and his management team can lead it out of its current crisis.

How does the CEO feel about the president’s executive-salary restrictions?

Lewis doesn’t seemed to be concerned for himself, but rather he seems concerned about the implications a salary cap could have on his supporting cast.

“I’ll take $500,000… However — beyond the top management team, when you’re talking about 20 to 30 others — who can go to foreign banks, who can go to other asset management companies, etcetera — that’s a problem.”

Lewis seems confident BofA is getting back on the right track. “But all I can tell you is that, in January, the capital markets were better. And that we didn’t see the deterioration in the asset values that we saw in the fourth quarter of last year.”

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HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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