The company's prospects for its Merrill Lynch subsidiary look bright, with management indicating in a recent meeting with O'Connor that the expansion of profit margin for its wealth management business was continuing in the second quarter.
Bank of America is also, like most banks, focusing on cutting expenses. The bank expects its "Project New BAC" to lead to annual cost savings of $1.5 billion by the end of 2014, although O'Connor wrote that many investors "assume a more meaningful decline in core costs over the next few quarters."
"From here, BAC shares should perform in line/slightly better than banks overall so long as the macro/monetary policy theme continues and/or cap markets revenue are better than expected," O'Connor wrote.
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