NEW YORK (Reuters) - It’s not a message you hear often from risk-averse big banks but Bank of America Corp (BAC.N) Co-Chief Operating Officer Thomas Montag on Tuesday told a roomful of hedge fund investors and managers that he had some good news.
“Risk seems to be back on,” he said at the company’s global hedge fund conference, noting a rush of investors in recent weeks into equities and bonds.
The bank’s Merrill Lynch wealth management unit, he added, oversees about $30 billion of assets in alternative investments, and “we are looking to grow that exponentially,” he told the hedge fund clients.
Montag, a 22-year veteran of Goldman Sachs Group Inc (GS.N) before joining Merrill in 2008 to run its global sales and trading unit, quickly added that risk-taking is not occurring among the bank’s own traders.
He rattled off a litany of statistics about Bank of America’s recovering health to reassure the prime brokerage and trading counterparty clients in the audience that they are safe “in taking on our risk.”
The bank’s long-term debt over the past two years has been more than halved to $150 billion from $325 billion, its liquidity — or access to readily available assets — has burgeoned in that period by over $160 billion to almost $400 billion, and its risk-weighted assets have declined about $214 billion to $1.29 trillion, he said.
Montag did not mention the company’s 2011 net income of 1 cent a share, or its share price that tumbled 43 percent in the past year but which is up 44.7 percent since January.
Reporting By Jed Horowitz; Editing by Gerald E. McCormick