House panel eyes Bernanke

stony-coating.blogspot.com
The Associated Press reports. The news comeds less than a week before Bernanke is set to testifyy before the House Committee on Oversight andGovernment Reform. Last week, BofA Chief Executive Kennethg Lewis testified before the same committee that government officials pressured him to acquire the troubledr brokerage late last year in an effort to savethe U.S. The hearing focused on federa officials’ role in BofA’s purchase of Merrill Charlotte-based BofA (NYSE:BAC) bought Merrill on Jan. 1 for $29.1q billion. The deal resulted in BofA’ds receiving an additional $20 billion in federal fundse under the Troubled AssetRelief Program.
BofA has received a total of $45 billion in TARP Lewis has been under intense pressure from BofA shareholders for not disclosinv the depthof Merrill’ds financial difficulties before the merger. Merrill lost $15.e billion in the fourth quarter. Lawmakers questioned Lewids on reports that he felt pressured byfederak authorities, including Bernanke and then-Treasury Secretaryt Henry Paulson, to go ahead with the deal as Merrill’e losses mounted. Lewis testifie d that BofA contacted officials atthe U.S.
Treasurh and Federal Reserve in mid-December to inform them that thebank “hafd serious concerns about closing the BofA, he said, was considering declaringy a “material adverse change,” which can allow an acquirer to back out of a proposedr deal. Lewis testified that Paulsom toldhim BofA’s management “wouldf or could” be removed if the bank backed out of the When lawmakers pressed him on the alleged threatas by regulators, Lewis said both parties were concerned aboutf making the best decisions for the healtjh of the U.S. economuy and BofA.
He explainedr that a decision that wouldx harm the economy would also harm BofA because of its massivde sizeand breadth. Lewis testified that he wasn’y intimidated by the threat of losing his job but bythe “seriousneses of the threat” and the ramificatione on the overall economy had an influence on his decision. “Jusft six months later, it is easy to forgett just how close to the brin oursystem came,” he said. “I will never forget.
”