Bank of America, the second-biggest U.S. bank by assets, said its board approved the repurchase of as much as $800 million in shares.
The repurchases are in addition to the $4 billion announced a year ago, the Charlotte-based bank said Friday in a regulatory filing.
The latest buyback is to offset share dilution that would otherwise result from recent incentive-compensation awards, according to the filing.
“The Federal Reserve did not object to the corporation’s proposed repurchases,” the bank said in the filing.
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Share repurchases reduce the number of outstanding shares on the market. They can make the price of a stock go up by boosting earnings per share.
Since the financial crisis, the largest banks must receive approval each year from the Fed to return capital to shareholders – through buying back stock or raising dividends. The Observer contributed.