More than 90% of Bank of America's originations in the first quarter came from refinancing. The bank said during its analyst call that it expects no slowdown in the pipeline and that it continues to expand hiring to keep pace with volumes.
Morgan Stanley analyst Betsy Graseck earlier this week upgraded the bank to overweight, arguing that it is in for a major earnings rebound. "We see an earnings inflection point based on the convergence of visible cost cutting, rising [home prices] driving mortgage originations, reduction in legacy assets and shrinking tail risks," Graseck said in a note on Bank of America to clients on Tuesday. The analyst expects Bank of America to increase its share to between 10% and 12% over time. "BAC's market share is already up 130 bp from trough levels in 1Q12 to 5.6% in 1Q13; we expect it to rise to ~7% by 4Q13, 8% in 2014, and 10-12% long term, in line with BAC's deposit market share but below BAC's peak market share of 18-20% in 2009-10 post exiting wholesale and correspondent channels," she wrote. -- Written by Shanthi Bharatwaj in New York. >Contact by Email. Follow @shavenk