Free Republic

Bank of America CEO Ken Lewis was the classic American success story. But he had a weakness for big deals—and his resignation was inevitable from the second he agreed to take on Merrill Lynch. On Wall Street, one man’s exit strategy is another man’s demise. In a world where enough is never enough, nabbing that last career-capping acquisition can kill you. Bank of America’s soon to be former CEO, Ken Lewis, knows that all too well. He was ruined by his personal nemesis—the drive to bigness. And bad timing. As the old gambling song says, “You got to know when...

Last September, as Wall Street turned to rubble and panic threatened to come unleashed, Ken Lewis, the CEO of Bank of America, agreed to swallow one of the country’s most toxic investment houses. The deal was not altogether voluntary; as details have slowly emerged, the coercive role of the Fed and Treasury has loomed larger. What exactly happened in the weeks leading up to the merger? Did the deal save us all from economic apocalypse? And what does the government’s unprecedented role in it portend for the future of our economy? It’s been almost a year since Bank of America...

WASHINGTON -- Former Treasury Secretary Henry Paulson misled Congress and along with Federal Reserve Chairman Ben Bernanke looked the other way as major mistakes were made at Bank of America Corp. even as the government was preparing a $20 billion aid package for the firm, U.S. lawmakers charged Thursday. Mr. Paulson, making his first appearance on Capitol Hill since leaving office in January at a hearing before House Committee on Oversight and Government Reform, defended the government's response to the financial crisis and his role in ensuring Bank of America closed its transaction for Merrill Lynch & Co. But lawmakers,...

WASHINGTON (Reuters) - U.S. lawmakers on Thursday slammed former Treasury Secretary Henry Paulson over the government's role in Bank of America's merger with Merrill Lynch, saying authorities suppressed information about losses and bullied executives into going through with the deal. "The American people, investors, and the Congress were kept in the dark," Rep. Edolphus Towns told Paulson at a hearing. "There was no oversight to determine whether this arrangement made sense. In my view, this is unacceptable and must be prevented from happening again," said Towns, the New York Democrat who chairs the House of Representatives Oversight and Government Reform...

Former Treasury Secretary Henry Paulson misled Congress and along with Federal Reserve Chairman Ben Bernanke looked the other way as major mistakes were made at Bank of America (BAC) even as the government was preparing a $20 billion aid package for the firm, U.S. lawmakers charged Thursday.

Former Treasury Secretary Henry Paulson on Thursday denied he and other government officials did anything improper or illegal when they put pressure on Bank of America (BAC: 13.2201, -0.2099, -1.56%) to complete a rushed merger with Merrill Lynch late last year. While admitting that pressure was applied, Paulson said every action taken at the time was made to fend off a potentially catastrophic collapse of the global financial system.

Former Treasury Secretary Henry Paulson says he was justified last year in suggesting that Bank of America Corp.'s chief executive could lose his job if the bank backed out on plans to buy troubled Merrill Lynch. His admission, included in written testimony for a House of Representatives hearing on Thursday, comes as Congress debates the government's role in managing financial firms that accept billions of dollars in aid. Bank of America Corp., which went through with the merger, ultimately accepted $45 billion in federal aid, including $20 billion to absorb the financial hit it took from acquiring Merrill Lynch &...

Former Treasury Secretary Henry Paulson says he pressured Bank of America last year to go through with its plans to buy Merrill Lynch but didn't tell the bank's chief to hide losses from shareholders.

Former Treasury Secretary Henry M. Paulson Jr., in defending the federal government's push for a reluctant Bank of America to complete a planned takeover of Merrill Lynch late last year, said it would have been "unthinkable" and potentially illegal for the bank to scuttle the deal. Mr. Paulson, who is set to testify Thursday morning on the merger before the House Oversight and Government Reform Committee, said in a prepared statement submitted to the panel that he "intended to deliver a strong message" to Bank of American Chief Executive Ken Lewis that backing out of the deal would be a...

n prepared remarks for a Congressional hearing obtained today by ABC News, former Treasury Secretary Hank Paulson admits telling Bank of America CEO Ken Lewis that the Federal Reserve could remove the bank's board members if they backed out of their proposed merger with Merrill Lynch last December. In prepared remarks for a Congressional hearing obtained Wednesday by ABC News, former Treasury... (AP Graphics) On Thursday morning, Paulson will defend his actions before the House Oversight Committee in the last of three hearings that the panel has conducted on the controversial merger. When Bank of America considered scuttling the merger...

Capitol Hill Republicans investigating the fire sale purchase of Merrill Lynch by Bank of America last year are digging for evidence of improper behavior by two Bush appointees – former Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke.

Right now, it’s unclear what rules apply. There is a new regime. What seemed prudent earlier has disappeared. I’m surprised Americans aren’t more panicked. Americans seem to accept a level of insecurity in their lives that Europeans wouldn’t tolerate. Paralysis is one response to this level of insecurity.” This might explain why my wife and I have taken no action to fix our finances. Although it’s also the case that we haven’t heard from our Merrill broker in nine months. The last time he called was well before the day in September when the government encouraged the shotgun sale of...

MBIA sues Merrill over CDO losses Thu Apr 30, 5:16 pm ET NEW YORK (Reuters) – MBIA Inc (MBI.N), the world's largest bond insurer, sued Merrill Lynch & Co on Thursday seeking damages for losses from complex debt securities it insured for the bank. The lawsuit, filed in New York State Supreme Court in Manhattan, seeks to void certain credit default swaps and related insurance contracts that MBIA, through a special purpose vehicle, wrote on the securities held by Merrill. The insurer wrote $5.7 billion in guarantees on these securities, which were packages of mortgages known as collateralized debt obligations...

Reporting from Charlotte, N.C. -- Amid the chorus of criticism that has descended on Kenneth Lewis, Bank of America Corp.'s embattled chief executive was re-elected to the company's board of directors today, but his fate as chairman remained unclear. Preliminary voting results from the company's annual meeting today showed that shareholders reelected Kenneth Lewis and 17 other directors who presided over the dramatic plunge in Bank of America's stock price during the financial crisis, according to a person familiar with the matter. However, it wasn't known yet whether Lewis will retain his position as board chairman, according to a person...

Bank of America (BAC) CEO Ken Lewis is fighting to keep his job because earnings at his company have plummeted. BofA's acquisition of Merrill Lynch has been a large part of the problem. Now, understanding that he is being made out to be the fall guy, he has fessed up that BofA was coerced into the deal. Federal Reserve Chairman Ben Bernanke and then-Treasury Department chief Henry Paulson pressured Bank of America Corp. to not discuss its increasingly troubled plan to buy Merrill Lynch & Co. -- a deal that later triggered a government bailout of BofA -- according to...

No one at the Federal Reserve advised Bank of America chief Kenneth Lewis on any disclosure issues, Fed spokeswoman Michelle Smith said on Thursday. "No one at the Federal Reserve advised Ken Lewis or Bank of America on any questions of disclosure," Smith said in an e-mail responding to a question. "It has long been the Federal Reserve's view that questions of this nature are best addressed by individual institutions and their legal counsel, as they are in a position to understand clearly their obligations and responsibilities." New York Attorney General Andrew Cuomo said on Thursday that Lewis was pressured...

The integrity of the government's bailout actions are called into question by a new report. There's a lot at stake. A new report by the New York Attorney General says that government officials bullied Bank of America Chief Ken Lewis into accepting a merger with Merrill Lynch--then ordered him to keep mum about losses at Merrill. What's at stake? The integrity of the government's bailout actions, for one. Federal Reserve Chairman Ben Bernanke's reputation, for another. And of course Lewis' job. Thursday, New York Attorney General Andrew Cuomo released documents charging that in December former Treasury Secretary Henry Paulson pressured...

At a time when people are having trouble holding on to their houses, Barack and Michelle Obama have sensibly decided not to use taxpayers’ money to renovate theirs. New presidents are allotted $100,000 to overhaul the White House residence and the Oval Office, and the Obamas hired Hollywood decorator Michael S. Smith (known, per his site, for mixing “Old World classicism with very contemporary settings”). But the First Couple isn’t spending that money. They “are not using public funds or accepting donations of goods for redecorating their private quarters,” says Camille Johnston, director of communications for the First Lady. Nor...

Merrill Lynch currency trader investigated over $400m loss By Adrian Cox and Peter Garnham in London and Greg,Farrell in New York Published: March 7 2009 02:00 | Last updated: March 7 2009 02:00 A Merrill Lynch currency trader has been suspended after racking up more than $400m in undisclosed losses in recent months, raising further questions about the financial health of the investment bank bought by Bank of America last September. Merrill is poring over the books of Alexis Stenfors, a London currency trader, who was suspended after Norwegian and Swedish currency trades went wrong, according to people familiar with...

Merrill Lynch admitted today that it had uncovered a possible rogue currency trader in its London offices, in another blow to the reputation of the bank that was rescued from near-oblivion last year. Authorities in the UK and Ireland are investigating the foreign exchange trader Alexis Stenfors (right), who worked in the Merrill offices near St Paul's cathedral. He is still on the Merrill payroll but listed as inactive on the Financial Services Authority register, meaning he cannot work as a trader. The Irish Financial Regulator said it had been made aware of "matters relating to the mispricing of trades"...