B of A wants repayment to up status
Share Now on:
TEXT OF STORY
Steve Chiotakis: Bank of America wants to pay back some of the billions of dollars in federal bailout money it received during the height of the financial crisis. The reason? To get out from under the government’s thumb. Here’s Marketplace’s Sam Eaton.
Sam Eaton: Bank of America is offering to repay at least a portion of the $45 billion in aid it received last fall. That’s what it took to help complete its takeover of the ailing Merrill Lynch.
According to the Wall Street Journal, B of A has suggested repaying $20 billion of that money in exchange for losing its status as an “exceptional” aid recipient. That label that puts the company under increased scrutiny from Congress and federal regulators.
JP Morgan, Goldman Sachs and Morgan Stanley have already repaid their bailout money. But Bank of America’s situation is far more complex. One source of contention is a tentative pact with the government to share its losses on toxic assets.
The government wants a $500 million breakup fee in order to end that agreement. Officials argue even though a final contract was never signed, B of A’s share prices rallied because of the implied protection.
In Los Angeles, I’m Sam Eaton for Marketplace.
We’re here to help you navigate this changed world and economy.
Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.
In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.
Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.