Bank of America's $1.6 Billion Charge Amid Transition from BSBY Index
TL;DR Summary
Bank of America took a $1.6 billion charge related to the industry's move away from the Libor benchmark, with the expectation of recouping it as income in the future. This non-cash charge, booked in the final quarter of 2023, will be recognized back into the company's interest income through 2026. The shift away from Libor led to the creation of alternative indices, and as a result, the bank had to make adjustments to its interest-rate swaps. This charge reduced the company's common equity tier 1 ratio by eight basis points, and Bank of America is set to report its fourth-quarter and 2023 results on Friday.
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- Bank of America to Take $1.6 Billion Charge The Wall Street Journal
- Bank of America to take non-cash charge of $1.6 billion in Q4 after cessation of a loan index Yahoo Finance
- Bank of America to take $1.6 billion noncash charge as it transitions away from BSBY index for lending MarketWatch
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