yasmin scott |
team after the merger.[59] However, after Thain was removed from his position, most of his allies left. The departure of Nelson Chai, who had been named Asia-Pacific president, left just one of Thain's hires in place: Tom Montag, head of sales and trading.[60] The bank, in its January 16, 2009, earnings release, revealed massive losses at Merrill Lynch in the fourth quarter, which necessitated an infusion of money that had previously been negotiated[61] with the government as part of the government-persuaded deal for the bank to acquire Merrill. Merrill recorded an operating loss of $21.5 billion in the quarter, mainly in its sales and trading operations, led by Tom Montag. The bank also disclosed it tried to abandon the deal in December after the extent of Merrill's trading losses surfaced, but was compelled to complete the merger by the U.S. government. The bank's stock price sank to $7.18, its lowest level in 17 years, after announcing earnings and the Merrill mishap. The market capitalization of Bank of America, including Merrill Lynch, was then $45 billion, less than the $50 billion it offered for Merrill just four months earlier, and down $108 billion from the merger announcement. Bank of America CEO Kenneth Lewis testified before Congress[4] that he had some misgivings about the acquisition of Merrill Lynch, and that federal officials pressured him to proceed with the deal or face losing his job and endangering the bank's relationship with federal regulators.[62] Lewis' statement is backed up by internal emails subpoenaed by Republican lawmakers on the House Oversight Committee.[63] In one of the emails, Richmond Federal Reserve President Jeffrey Lacker threatened that if the acquisition did not go through, and later Bank of America were forced to request federal assistance, the management of Bank of America would be "gone". Other emails, read by Congressman Dennis Kucinich during the course of Lewis' testimony, state that Mr. Lewis had foreseen the outrage from his shareholders that the purchase of Merrill would cause, and asked government regulators to issue a letter stating that the government had ordered him to complete the deal to acquire Merrill. Lewis, for his part, states he didn't recall requesting such a letter. The acquisition made Bank of America the number one underwriter of global high-yield debt, the third largest underwriter of global equity and the ninth largest adviser on global mergers and acquisitions.[64] As the credit crisis eased, losses at Merrill Lynch subsided, and the subsidiary generated $3.7 billion of Bank of America's $4.2 billion in profit by the end of quarter one in 2009, and over 25% in quarter 3 2009.[65][66] On September 28, 2012, Bank of America settled the class action lawsuit over the Merrill Lynch acquisition and will pay $2.43 billion.[67] This was one of the first major securities class action lawsuits stemming from the financial crisis of 2007–2008 to settle. Many major financial institutions had a stake in this lawsuit, including Chicago Clearing Corporation, hedge funds, and bank trusts, due to the belief that Bank of America stock was a sure investment. Federal Troubled Asset Relief Program Bank of America received $20 billion in the federal bailout from the U.S. government through the Troubled Asset Relief Program (TARP) on January 16, 2009, and a guarantee of $118 billion in potential losses at the company.[68] This was in addition to the $25 billion given to them in the fall of 2008 through TARP. The additional payment was part of a deal with the U.S. government to preserve Bank of America's merger with the troubled investment firm Merrill Lynch.[69] Since then, members of the U.S. Congress have expressed considerable concern about how this money has been spent, especially since some of the recipients have been accused of misusing the bailout money.[70] Then CEO Ken Lewis was quoted as claiming "We are still lending, and we are lending far more because of the TARP program." Members of the U.S. House of Representatives, however, were skeptical and quoted many anecdotes about loan applicants (particularly small business owners) being denied loans and credit card holders facing stiffer terms on the debt in their card accounts
|
www.shanagrant.com
Shauna Grant The Last Porn Queen |
|
|
|
|
|