Bank of America 'set to add $13bn to book value'

10 August 2010

Bank of America (BofA) could add around $13 billion to its book value thanks to its 11 per cent stake in China Construction Bank.

According to analysts at Wells Fargo and Royal Bank of Canada, the shares were valued at an original cost of $9.2 billion as they cannot be sold until August 2011.

But with that date now less than a year away, accounting rules mean the stake is now priced at market value - which currently stands at a total of $22.9 billion, reports Bloomberg.

BofA is set to include the updated figure in its results for the third quarter of 2010, which will be released in October.

Last month, the financial institution revealed that it recorded net income of $3.1 billion in this year's second quarter.

The figure was slightly down on the $3.2 billion amount made by Bank of America in the same period in 2009.

By Gary Cooper

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