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Bank of America, Hilariously, Thinks It Has Good Customer Service (Update 1)

Bank of America story updated with changes and additional details throughout.

NEW YORK ( TheStreet) --Bank of America CEO Brian Moynihan said he didn't cut expenses as fast as some analysts hoped because the bank wanted to maintain what he called good customer service.

Don't tell that to the Pittsburgh woman who claimed she had her parrot held hostage when Bank of America (BAC - Get Report)seized the wrong house, or the Galveston, Texas couple that says it had no relationship whatsoever with the bank but still lost 75 pounds of fish when Bank of America shut off the power on its vacation home.
Bank of America CEO Brian Moynihan

Don't tell it to the 5,000 Oregonians who Bank of America mistakenly told they were late on their property taxes.

But that was the message from bank CEO Brian Moynihan on Thursday, after he was asked on the company's fourth quarter conference call by CLSA analyst Mike Mayo, "are you cutting enough?"

Mayo may have a point, as he notes that revenues fell $17 billion in 2011 to $93 billion versus $110 billion last year while [noninterest] expenses fell by just $3 billion--to $80 billion from $83 billion.

Moynihan's response?

"You can always say, can I go a little faster, go a little slower, but we need to balance especially on the broad consumer business and need to have good customer service," and "strong customer relationships," he said.

Bank of America eked out a profit of a penny per share in 2011, versus a 37 cent loss in 2010. The 15 cents per share the bank earned in the fourth quarter met analyst expectations. Shares were up 2.28% to $6.95 about 40 minutes before Thursday's close.

Bank of America has been shrinking in order to build up its capital cushion to meet new regulatory standards and bring its balance sheet in line with those of stronger peers such as JPMorgan Chase (JPM), Citigroup (C) and Wells Fargo (WFC).

In addition to selling several businesses such as its Canadian credit card portfolio and stakes in institutions such as China Construction Bank and BlackRock Financial (BLK), the bank has eliminated 400 retail branches. It has also been reducing headcount, eliminating a net 7000 jobs during the fourth quarter.

Still, its attempts at "getting its message out" to investors remain as ham-fisted as ever. Whether it's a question of constantly moving the goal posts on its exposure to mortgage problems, pretending it's lending to small business when it isn't, or backtracking on debit card fees a month after announcing them, the bank just can't seem to do anything right.

Maybe that explains why investors seem to be happy with the bank's plan to shrink itself back to health. It's not exactly inspiring, but it appears to be enough for the moment.

-- Written by Dan Freed in New York. Follow this writer on Twitter.
Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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