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Boa Economics Essay

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Below is an essay on "Boa Economics" from Anti Essays, your source for research papers, essays, and term paper examples.

Profits / Market Power
From 2007 to 2012, BOA’s Return on Equity average was 1.55%.   This sub-par performance is a result of an unstable domestic and international economy which fueled the economic meltdown in the United States.  
| Year |   |
Financial Metric | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 (Mar) | Avg |
Return on Assets | 0.95% | 0.14% | -0.10% | -0.16% | 0.00% | -0.06% | 0.13% |
Return on Equity | 10.97% | 1.84% | -1.23% | -1.72% | 0.04% | -0.62% | 1.55% |

Growth / Innovation
Although BOA’s growth of sales (revenue of growth) is below industry average at -2.56%, BOA has incorporated various innovative strategies.   Some of these strategies have been through two blockbuster acquisitions of Countrywide and Merrill Lynch in 2008 and expanding their international footprint in South America (specifically Brazil).  
  | Year |   |
Financial Metric | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 (Mar) | Avg |
Revenue of Growth | -10.80% | -11.34% | 28.90% | -9.35% | 4.78% | -17.56% | -2.56% |

Capital / Resources
Financial institutions operate in perfect competition.   Porter’s five forces reveals that the entry is high due to the high capital requirements and government policies.   Also the financial institutions have unique resources as there are a limited amount of competitors due to the current economic crisis, high exit barrier and brand recognition of mature institutions.
Conclusion / Recommendation
Based on the economic value added (EVA) financial mode that I have learned in this course, I would recommend for BOA to increase their stock value by incorporating the following actions:
Profits driven by competition - Improve internal communication.
  * BOA’s main weakness is the lack of effective internal communication.   Because processes and procedures were not quickly communized during recent acquisitions and different management ideals and principles exist, everyone is working in silos instead of working as one collective...

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"Boa Economics". Anti Essays. 11 Dec. 2018

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Boa Economics. Anti Essays. Retrieved December 11, 2018, from the World Wide Web: http://snehaedu.com/free-essays/Boa-Economics-357059.html