Bank of America Terminates Agreement
September 21, 2009 by Stephen Kersey
Filed under Business
On Monday, Bank of America announced that it has agreed to a deal with the United States federal government to terminate its term sheet agreement. To terminate the agreement, Bank of America will pay $425 million. The money will go to the FDIC, the Federal Reserve and the Treasury Department.
This agreement was originally constructed after Bank of America acquired Merrill Lynch at the beginning of the year. In the agreement, the federal government guaranteed nearly $120 billion in assets. However, Kenneth Lewis, the CEO and President of Bank of America, believes that his company has the means to thrive on its own.
“We are a stronger company than we were even a few months ago,” said Lewis, “and while we continue to face challenges from rising credit costs, we believe we have all the pieces in place to emerge from this current economic crisis as one of the leading financial services firms in the world.”
Since the financial industry received a number of federally sponsored bailouts, Bank of America has slowly but surely taken steps to move away from government reliance. This latest deal is another example.
Said Lewis: “We are pleased to resolve this matter and move forward.”
Bank of America (Image: Flickr)
