Bank of America

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First up is Bank of America ( BAC), the controversial $75 billion banking giant that's been at the center of so many headlines in the past few years. Pension funds bought up 19.2 million shares of BAC in the most recent quarter, hiking their quarter-billion-dollar stake in the bank by close to 10%.

Bank of America is cheap right now -- it's one of the big bank banks that trades for less than its tangible book value for share. But that bargain price is for good reason. The firm's labyrinthine balance sheet includes significant legal liabilities from its Countrywide acquisition in 2008 and massive exposure to bad debt. The fact that Bank of America is hard to value right now is one of the biggest reasons for its discount, but as sophisticated investors start to gain assurance over BofA's balance sheet, retail investors should take notice.

>>5 Large-Cap Bank Stock Buys From Guggenheim

And on the flip side, the bank has scale advantages that only a handful of names can boast, including a mountain of cheap deposits that it's lending out with higher underwriting standards than in years past. With reasonable equity reserves in place right now and an income statement that's becoming less susceptible to landmine one-time expenses and charges, BofA may become less cheap quite soon.

While risks are still high enough to argue against too concentrated of a position in BAC, risk-hungry investors could do well to dip a toe in this bank.

Bank of America, also one of Appaloosa Management's holdings, shows up on a recent list of 5 Bank Stock Pullback Bargains.

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