Bloomberg News

BofA’s Moynihan Predicts Economy Will Grow Slowly Again in 2012

December 20, 2011

Dec. 19 (Bloomberg) -- Bank of America Corp. Chief Executive Officer Brian T. Moynihan said 2012 will be another year of slow economic growth.

Consumers continue to increase spending, which is “modestly encouraging,” Moynihan, 52, said today at an economic outlook conference held in Charlotte, North Carolina, where the company is based. Employment will remain a challenge for next year, he said.

“It’s all about jobs,” Moynihan said.

Bank of America, the second-biggest U.S. lender by deposits, is cutting costs amid stagnant revenue. The bank has been hurt by weak economic growth and concern that Europe’s debt crisis will spread through the world’s financial system. Shares of the firm have dropped more than 60 percent this year.

The U.S. economy will slow to 1 percent annualized growth by the end of next year as Europe enters recession, according to a report last week from Bank of America economists.

Moynihan spoke as part of a panel that included Jeffrey Lacker, president of the Federal Reserve Bank of Richmond, who said impediments to economic growth will be “deeper and more persistent than we thought a year ago.”

Obstacles Lacker cited include the oversupply of housing, a mismatch of skills between unemployed people and new jobs, changes in tax policy and regulations and the “murky federal budget outlook.”

--Editors: Rick Green, Dan Kraut

To contact the reporters on this story: Hugh Son in New York at hson1@bloomberg.net

To contact the editor responsible for this story: Rick Green at rgreen18@bloomberg.net


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