A Bank of America sign is shown on a building in downtown Los Angeles, California
Bank of America Corp said on Monday that regulators had suspended its plan to buy back more shares and raise its dividend after the bank realized it had miscalculated a measure of the capital on its books. The second-largest U.S. bank said fixing the mistake reduced a capital level by $4 billion, or about three-quarters of the extra money that the Federal Reserve had approved its returning to shareholders over the next year. News of the gaffe sent the bank’s shares down 6.3 percent on Monday to close at $14.95, in the biggest one-day decline in the stock since November 2012. (BREAKINGVIEWS-BofA reclaims banking dunce cap with $4 billion flub. The announcement illustrates how difficult it is to determine appropriate capital levels for the biggest banks, particularly under hypothetical stress situations that regulators consider. Bank of America now has to submit its request to return more capital to shareholders for a third time, and the Fed itself previously erred in projecting the bank’s minimum capital ratios under a stressed scenario. More