Tomahawk, WI 11/08/2013 (BasicsMedia) – Bank of America Corp (NYSE:BAC) has been under immense pressure since the start of the year as it continues to grapple with increased lawsuits emanating from its dealings in the Mortgage industry. The company has seen many lawsuits ending up in payment settlement for damages caused as a result of their actions in the mortgage industry. Increased lawsuits are known to hurt businesses reputation as they always result in huge amount of cash flows in terms of settlement plans. JP Morgan and Bank of America have been accused in various quarters as having misled applicants and other business entities in the acquisition of fraudulent mortgages and securities.

 Questions are mounting with each sunrise as to whether one of the largest banks in America needs a change in its management to foresee its success in the coming years as it is currently hitting low bottom in hot water. There is no other CEO in the bank industry that is under immense pressure other than Bank of America’s. The whole lot of problems begun with Bank of America acquisition of Countrywide which it had earlier seen as a “cash cow” able to boost its revenue collection in the hard hit Mortgage industry as a result of financial crisis of 2009. Countrywide was at the moment the forefront runner for the bad mortgage loans that were making waves between 2006 and 2009.

Lawsuits have been streaming in since Bank of America purchased Countrywide as claims of fraudulent dealings continue to mount. The bank has resorted to settle the claims a move that might harm the company cash reserves in the coming quarters if the lawsuits continue to increase. The biggest question in investors at the moment is whether the company has the much needed capacity to swim through the murky waters of the lawsuits. The lawsuits begun in 2012 with countrywide being accused of funneling loans whose quality was suspicious to Fannie Mae and Freddie Mac the biggest fear at the moment is that the lawsuits may continue for some time which may considerably harm the company in terms of investors’ confidence.

 The bank has already incurred huge legal costs mounting to $20.1 billion for the past 5 years with still a chain of lawsuits yet to be completed. This leaves a lot of questions of what holds for the company in the coming days. The company has already been forced to pay up to $35.7 billion in the purchase of a number of mortgages from investors who had complained about the quality of these investments. The company in 2009 was forced to pay Merrill Lynch a total of $2.43 billion and this year it has also been forced to pay $1.7 billion to MBIA. It is also estimated that an $8.5 billion settlement case still hangs in the air before the close of the year. The continuing crisis has resulted in the company fortunes dropping by 50% with analysts warning more is yet to come in the coming days

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