Page 28 - Bank of America E Case Study

economy continues to move along, even at the
2 percent growth level, we'll start to materialize

more and more earnings, and that's what we
need to do."(24)

For Moynihan, in the 2017 shareholder letter, there were

four lessons learned from the 2008 crisis impacting his

commitment to eschew acquisitions in favour of organic

growth:

“First, we must grow organically. Acquisitions

are not part of our strategy so we don't have to

issue shares.

Second, our businesses generate more than

sufficient capital to fund their growth. We have

shed non-core businesses and we have

everything we need to serve our clients, so we

can focus on building stronger relationships

with them and optimizing returns.

Third, we need to continue to reduce the
number of shares outstanding. This is essential

if we want our stock price to exceed the record
highs we have achieved in our market

capitalization and in our tangible book value per

share. And, because our stock is trading at a

price that is close to our book value,

repurchasing shares now creates long-term

value for remaining shareholders when we buy

from the selling shareholders at this level.