Bank of America gains most in year after revising dividend plan

NEW YORK – Bank of America Corp. rose the most in more than a year after the firm resubmitted its request for a bigger payout to the Federal Reserve.

The stock climbed 3.9 percent to $15.30 at 11:10 a.m. in New York, the best showing in the 24-company KBW Bank Index. Shares of the Charlotte, N.C.-based lender had slumped 5.5 percent this year through last week. The company said in a regulatory filing on Tuesday that it had sent its new capital plan to the central bank.

Bank of America last month suspended plans for a dividend increase and $4 billion of share repurchases because of an error in its stress test submission to the Fed. The company had said the revised version would include a smaller payout request than the original, which called for increasing the quarterly amount to 5 cents a share from 1 cent.

“The feeling is Bank of America will be able, at some point this year, to pay a better dividend,” said Nancy Bush, a bank analyst who founded NAB Research LLC in New Jersey. Some investors had been unsure the company would resubmit this year, let alone this quickly, Bush said.

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The Fed has 75 days to review the new data, according to Bank of America, which said it can’t give assurances about the timing or outcome of the decision.

The bank’s revisions “resulted in additional adjustments that had a de minimis effect (less than one basis point reduction) on the corporation’s reported regulatory capital ratios for the period ended Sept. 30, 2013, and no effect on such ratios for the period ended March 31, 2014,” the company said.

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