Bank of America's Continuing Pain Will Be Patient Investors' Gain

NEW YORK (TheStreet) --Bank of America (BAC) is still reeling from a long litany of legal issues associated with improper business practices. That doesn't mean this potent financial behemoth isn't still a promising investment.

The stock trades around $15.60, flat on the year to date but up about 6% over the last 52 weeks.

Love it or hate it, the second-biggest U.S. financial firm has been receiving plenty of unwanted media coverage starting in April with the federal judge ordering the bank to pay nearly $1.3 billion in penalties for its role in defrauding Fannie Mae and Freddie Mac into buying thousands of doomed mortgages.

Since I don't subscribe to the notion that any kind of publicity is good publicity, it's also disturbing that Bank of America's Merrill Lynch division keeps showing up in stories about "dark pools." These are secretive operations that allow investors to trade shares anonymously so their activities are hidden from their competitors.

Coming up, Bank of America will soon hear from the Federal Reserve, which has until August 10 to decide if it will allow the bank's plan for a 5-cent dividend increase and a limited share buyback. The bank fared poorly during the Fed's most recent round of financial stress tests.

So why invest in Bank of America? Because when Wall Street learns about Bank of America's continuing campaign to win more depositors plus investors for its Merrill Lynch side by lowering fees, commissions and offering free banking accounts, its share will soar.

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