UK pressures Bank of America unit on risk management - Wall Street Journal

Reuters

(Reuters) - British regulators are pressuring Bank of America Corp's European investment-banking arm to improve its risk management practices, saying the current ones are "simplistic" and need to be retooled, the Wall Street Journal reported.

The Prudential Regulation Authority's criticism was included in a letter this year to the bank's European unit, the Journal reported, citing people familiar with the matter.

The letter, written by the PRA's head of supervision for U.S. investment banks, also said Bank of America's Merrill Lynch International unit needed to be "more comprehensive" in evaluating the risks posed by its top business partners, according to the Journal.

The PRA's letter to Merrill Lynch International called for improvements in how the bank measures potential risks arising from its exposures to its top five counterparties. The letter did not identify those institutions.

Bank of America declined to comment.

(Reporting by Avik Das in Bangalore; Editing by Ted Kerr)