BofA, Citi Witness Ban From Louisiana Deal Over Gun Policies
In a voting held on Aug 16 by Louisiana’s state bond commission, Bank of America BAC and Citigroup C have been voted to keep out from participating as underwriters of $600 million worth bonds sale to finance interstate projects.
The commission led by Chairman and State Treasurer John M. Schroder, voted seven to six to ban two of the major Wall Street biggies due to the “restrictive gun policies” that both the banks had adopted earlier this year, post mass shootings carried out in at a high school in Parkland, FL.
The two banks had announced that they will end relationships with retailers and manufacturers that sell firearms to people below 21 of age. The commission sees these policies as a breach of second amendment rights that allow civilians the right to own a firearm for self-protection.
Schroder said, “I personally believe the policies of these banks are an infringement on the rights of Louisiana citizens.”
He further added, “As a veteran and former member of law enforcement, I take the Second Amendment very seriously.
We have a very capable group of underwriters including some of the biggest banks in America who want to participate in this deal. No one can convince me that keeping these two banks in this competitive process is worth giving up our rights.”
Another major wall street bank to take action against gun dealers was JPMorgan Chase JPM. The company had cut down business relations with gunmakers at the time.
Citigroup and Bank of America have been facing constant criticism from the Gun Owners of America and the National Rifle Association since they have taken stance against lending money to gun makers.
Shares of Citigroup and Bank of America have lost 9.5% and 3.6%, respectively, over the past six months compared with the industry’s decline of 4%.
SIx Months Price Performance
Both the stocks currently carry a Zacks Rank #3 (Hold).
A better-ranked stock in the same space is Comerica Incorporated CMA. The company has witnessed 5.2% upward estimate revision over the last 60 days. Also, its shares have rallied 44.3% in the past year. The stock currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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