Bank of America thwarts speculations on its nationalization

In a move to prevent the further spread of fears that Bank of America might be nationalized Kenneth Lewis, CEO of BofA, announced that the largest U.S. bank does not need more federal injections into the company and is in a better state as compared with its rivals. Last week speculations about Bank of America’s possible ownership by the government made the shares of the Charlotte, North Carolina-based lender fall below $3, the lowest level since 1984.

"Our company does not need further assistance today and I don't believe we'll need any more in the future," Lewis said in a memo sent to employees. "Our business prospects and financial condition are far superior to those of most of our competitors."

In afternoon trading, the bank's shares were up 63 cents, or 16.11 percent, at $4.55.

By the moment Bank of America along with Citigroup Inc received $45 billion of federal aid each along with the bailout to cap losses on troubled assets.

Lewis underlined that the bank is now strong enough to endure current economy environment with ever increasing unemployment rate.

"Bank of America's overwhelmingly large deposit base, our consumer and commercial customer base, and earnings power give us a great advantage over banks that have been more badly damaged in the current crisis," Lewis wrote.

"We continue to be profitable, our capital and liquidity are strong and we are actively lending in every sector of the marketplace," he said. "The market appears to be moving in part based on rumor, innuendo and falsehoods propagated by the misinformed."

Besides, Lewis added that the bank's tangible common equity ratio, a measure of capital, is about 2.68%, which he noted is twice the level of other counterparts he did not named.