NEW YORK - Bank of America (BAC) is shelving plans to increase its dividend and buy back more stock.
Bank of America Corp. says the move is tied to an incorrect adjustment of how it valued certain securities it obtained through its acquisition of Merrill Lynch in 2009. As a result, it needs higher levels of regulatory capital.
The bank, based in Charlotte, North Carolina, said early Monday that, at the request of the Federal Reserve, it will suspend its previously announced plan to buy $4 billion in stock and raise its dividend from a penny per share to 5 cents per share.
Bank of America's stock was down 44 cents, or 3 percent, to $15.51 a half-hour before the start of the regular trading day.