Tomahawk, WI 11/15/2013 (BasicsMedia) – What does the future look like for Bank of America Corp (NYSE:BAC), the second largest bank in the U.S. in asset base, in post litigations? There are only two possible cases to talk about the fate of BAC in post lawsuits. The bank could either emerge strong from the cases or scathed.

The bank emerging stronger would be possible if it’s vindicated from wrong doing over the numerous lawsuits it’s currently soaked in. Such vindication will save the bank a lot of money which can be challenged to more productive or promising projects. However, considering how the cases have progressed so far, the bank has already witnessed a lot of money leaving its coffers to settle investment disputes.

The second scenario that the bank is found guilty of wrong doing, it would a serious damage to the U.S. bank who senior executive White House has asked to serve in the Commerce Department. BAC stands to loss billions of dollars in settlements with clients and investors baying for its blood. Then there is also the issue of the bank’s reputation. Things are even made worse considering that the bank is pitted against the government in the battle over bad mortgage loans.

The bank is accused of misleading two government-backed mortgage investors Fannie Mae and Freddie Mac into signing bad loans which the two forms packaged into securities and sold to investors, resulting in billion of investment losses. Whether the bank tricked the government mortgage institutions deliberately or not is the subject of many litigation cases already before courts. What is clear though is that the bank has claimed innocence, saying that the said shoddy mortgage deals where transacted by Countrywide long before it acquired the business in 2008. But it seems its accusers including the government that has asked a court to fine the bank $864 million would hear none of its plea.

For now, it seems that Bank of America Corp (NYSE:BAC) has become a case study for the industry on how bad it can be to transact suspicious deals. The government also looks keen to make an example out of the bank and its peers like JPMorgan which is also facing a mountain for mortgage related cases.

Image wise, BAC will lose big if found guilty. The bank serious needs its good name in the competitive financial services industry. In fact, this image is its investment in such businesses as wealth management. How do you get people to trust you to manage their wealth if you have been proven to be lacking in trust? The image issue is complex for the bank considering that it’s just in the process of increasing its foothold in wealth management. The recently report that the segment was poised for growth and that it was becoming a potential source of significant revenue.

Even as the bank is facing tough times, it has been able to maintain its score on the browsers. The bank is currently trading on NYSE at a price that is just a few cents off its 52 week highest. Yet its jump from a year’s low is also impressive. The $158.17 billion capped company would be praying hard the lawsuits its confronted with now would be able to go away sooner than later to allow it time to exploit its opportunities.

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