According to these cautious firms, though Bank of America settled its liabilities with GSEs during the quarter, claims related to private securitizations and monoline still linger. Though the shedding of non-core assets and riskier loans are helping improve capital ratios, continued legal and regulatory changes could hinder earnings growth. Additionally, as Bank of America is one the largest owners and servicers of U.S. mortgages due to its purchase of Countrywide, it is significantly involved in the mortgage foreclosure mess, which could continue to result in losses. These firms believe that the company will continue to face increased levels of regulatory (Basel III and Durbin Amendment), legal (mortgage and foreclosures) and economic (higher unemployment and lower interest rates) headwinds for the next several quarters. These firms expect pressure on Bank of America’s traditional banking, which is accountable for more than half of its revenue, due to sluggish loan growth, high credit costs, low NIM, and depressed fee revenue. However, improving securities-related businesses will partially offset the negative pressure. The company is also expected to significantly benefit from the rising interest rate environment as it holds one of the industry's best deposit franchises.