Page 15 - Bank of America E Case Study

The Financial Melt-down

As part of the Troubled Assets

Relief Program (TARP) BofA had

initially received $25 billion in

October 2008. It was then

pressured to take over the

vulnerable investment house of

Merrill Lynch, to forestall its

collapse after it had announced an $8 billion write-down

in 2007. For taking it over BofA received an additional $20

billion in January 2009 ostensibly to help it absorb Merrill.

Shareholders of both companies had approved the

acquisition on December 5, 2008, and the deal was

completed on January 1, 2009 even though Merrill had
reported a loss of more than $15 billion in the fourth

quarter of 2008.

In January 2009, The

Wall Street Journal

reported that the

Bank of America was

operating under a

secret

End of 2008 - Ref: (19)

Diagram 3