Financial Winners and Losers: BofA

Updated from 2:17 p.m. EDT

Bank stocks were mixed Friday, with Bank of America (BAC Quote) one of the session's best performers after a brokerage firm raised its stock price target on expectations the company would repay bailout funds by early 2010.

Stifel Nicolaus said it expects BofA to pay back $25 billion of the $45 billion it received from the Troubled Asset Relief Program by late 2009, with the remainder expected to be paid back in early 2010. The firm upped its price target for BofA shares to $22 from $18 to reflect that view and maintained its buy rating.

However, Stifel Nicolaus did lower its second-quarter earnings target to a penny a share from 11 cents in order to reflect the TARP repayment. The firm also lowered its full-year outlook to 77 cents from 83 cents a share. Still, BofA shares climbed 5.8% to $13.72.

Meanwhile, JPMorgan Chase (JPM Quote), Morgan Stanley (MS Quote) and American Express (AXP Quote) were mixed on word the three companies would be the first to repay TARP money on Wednesday, according to The Wall Street Journal, which cited people familiar with the matter.

The Treasury Department earlier this week granted 10 of America's largest lenders approval to pay back $68 billion in TARP funding. Repaying the TARP funds will free the banks from limits on executive pay, regulatory reviews, management shake-ups and political pressure to lend to businesses and consumers at low interest rates.

JPMorgan climbed 0.5% and Morgan Stanley shares rose 0.7%, while AmEx sank 1.8%. The three firms received $25 billion, $10 billion and $3.4 billion, respectively.