BofA to Pay $2.43 billion Over Merrill Acqusition

On September 28, 2012, Charlotte-based Bank of America agreed to settle a case from its shareholders for $2.43 billion. The plaintiffs, including several pension funds such as Teacher Retirement Systemof Texas, accused BofA of misleading the then-shareholders on the health of Merrill Lynch prior to September 2008 acquisition. The $20 billion transaction came under scathing criticism when BofA said afterward that Merrill would lose $27.6 billion that year. Also, the Charlotte-based bank failed to disclose, prior to shareholders' vote, $5.8 billion bonus to be paid to Merrill employees. The Securities and Exchange Commission won a $150 million settlement in 2009 regarding BofA acquisition of Merrill. Now, the $2.43 billion settlement goes to US District Judge Kevin Castel of the Southern District of New York. Bank of America faced host of lawsuits regarding its July 2008 acquisition Countrywide Financial and September 2008 acquisition of Merrill Lynch. BofA on the Countrywide acquisition entered into an $8.4 billion settlement with 12 states and another $600 million with Countrywide shareholders.

Source: The Dallas Morning News