Rift Could Be Reason For BofA's BlackRock (BLK) Stake Sale
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Price: $57.74 -0.29%
Overall Analyst Rating:
SELL (= Flat)
Dividend Yield: 2.1%
Revenue Growth %: +13.9%
Overall Analyst Rating:
SELL (= Flat)
Dividend Yield: 2.1%
Revenue Growth %: +13.9%
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According to FOX Business Network’s Charles Gasparino, Bank of America Corp. (NYSE: BAC) is considering selling off its stake in BlackRock Inc. (NYSE: BLK) due the fact that the companies' CEOs "just don't get along."
The report said that there is no real financial reason for the decision for Bank of America to sell off its stake in the company, but Gasparino said that it is more of a personal reason.
"The two guys at the top of these firms, Larry Fink who runs Blackrock and Brian Moynihan who runs Bank of America, sources are telling us, just don't get along,” said Gasparino. "This is the largest money management firm in the US. Maybe in the world. 3 trillion dollars. Why would you want to sell? This is what doesn’t make sense here. The Fed is breathing down every banks necks basically saying 'we don't want you out there rolling the dice, but we do like the notion that you are stable investments.' BlackRock is a pretty stable investment. This is not a hedge fund; this is a very well run place."
One of the big problems pointed out by Gasparino in the relationship between the two is that Fink supports Greg Curl to be CEO of Bank of America, and regarded Moynihan as being a "lightweight."
"You need the guys at the top, in terms of corporate strategy, to essentially talk to each other and from what I understand they are not."
Gasaprino notes that Bank of America would not sell its stake until close to the end of the year, and that announcing this while shares of BlackRock are suffering as interesting.
"You don't sell your stake when shares are getting crushed as they are."
The report said that there is no real financial reason for the decision for Bank of America to sell off its stake in the company, but Gasparino said that it is more of a personal reason.
"The two guys at the top of these firms, Larry Fink who runs Blackrock and Brian Moynihan who runs Bank of America, sources are telling us, just don't get along,” said Gasparino. "This is the largest money management firm in the US. Maybe in the world. 3 trillion dollars. Why would you want to sell? This is what doesn’t make sense here. The Fed is breathing down every banks necks basically saying 'we don't want you out there rolling the dice, but we do like the notion that you are stable investments.' BlackRock is a pretty stable investment. This is not a hedge fund; this is a very well run place."
One of the big problems pointed out by Gasparino in the relationship between the two is that Fink supports Greg Curl to be CEO of Bank of America, and regarded Moynihan as being a "lightweight."
"You need the guys at the top, in terms of corporate strategy, to essentially talk to each other and from what I understand they are not."
Gasaprino notes that Bank of America would not sell its stake until close to the end of the year, and that announcing this while shares of BlackRock are suffering as interesting.
"You don't sell your stake when shares are getting crushed as they are."
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