NEW YORK (Thomson Financial) - Bank of America Corp. Chief Executive Kenneth Lewis said he sees no reason for the bank to either raise capital, or to cut dividends, as feared by the financial markets.

Speaking at a public meeting in Los Angeles Wednesday, he said he believes the U.S. economy could begin to recover in mid-2009 but until then there would be a ‘feeling of recession’ in the United States. Lewis also estimated that U.S. GDP would grow by 1 percent in the second quarter.

While bank shares plummeted Wednesday, against a backdrop of fears of further losses related to the subprime crisis, Lewis reassured on the state of his bank, which has just completed the acquisition of Countrywide Financial (nyse: CFC - news - people ), the first mortgage lender in the country, for $2.5 billion.

Lewis again defended the acquisition of Countrywide, at one time threatened with bankruptcy, saying the business is ‘very good’.

Lewis also said that the bank plans to resolve at least $40 billion worth of troubled mortgages over the next two years, helping more than 250,000 families stay in their homes.