Bank of America, Bank of New York Mellon, Citigroup, Goldman Sachs, JP Morgan Chase, Morgan Stanley, State Street, and Wells Fargo, in a statement via the Financial Services Forum, agreed to temporarily suspend share buybacks for the remainder of 1Q and through 2Q 2020.
“The decision on buybacks is consistent with our collective objective to use our significant capital and liquidity to provide maximum support to individuals, small businesses, and the broader economy through lending and other important services,” the group wrote, citing the COVID-19 pandemic as an “unprecedented challenge”
– Banks were buying back their shares ? How did they do that ? By increasing their debts ? Have they gone out of their minds ?
– A friend of mine said a few years ago that the US had become a “banana republic”. For a long time I thought he was nuts. But when I read all the things US corporations had done in the past years (incl. share buy backs) then I started to realize more and more that this friend was right.