Word: bankes
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Dates: during 2000-2009
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When McColl retired in 2001, Lewis took over. But rather than retrenching as most people expected, Lewis proved he liked the art of the deal as much as McColl. In 2003, Bank of America bought Boston-based bank Fleet for $47 billion. Two years later he spent $35 billion to buy credit card giant MBNA. And as the credit crisis began to unfold, Lewis picked up Countrywide, which at its height was the nation's largest independent mortgage lender, for just over $4 billion...
Since the acquisition, Bank of America's stock has fallen 50% and at one point went as low as $2.53. The problems at Merrill Lynch have turned out to be much bigger than Lewis originally thought. And at times, the Merrill-related losses have raised anxiety about the health of the entire bank. In January the Treasury Department announced it was injecting an additional $20 billion into Bank of America. In all, the government has spent $45 billion trying to stabilize the finances of the bank...
Many analysts believe that the Merrill deal, while risking the solvency of Bank of America, will end up being a boon for the bank. Merrill still has a strong investment-banking franchise, and even in the depth of the financial crisis, its wealth-management business continued to be profitable. Nonetheless, Lewis won't be around to see the fruits of the deal...
Anger among Bank of America investors about the Merrill Lynch deal has been brewing for months. In April, shareholders voted to strip Lewis of the title of chairman. Even then, some people predicted Lewis was not long for the bank, but he managed to hold on to his CEO title for six more months...
Lewis' problems came to a head this summer. Bank of America had struck a deal with the SEC to pay $33 million to end an investigation into whether some unnamed Bank of America executives had mislead shareholders when it purchased Merrill. The SEC alleges that in early December, on the eve of a vote to approve the Merrill deal, Bank of America executives told shareholders that no bonuses would be paid to Merrill executives prior to the acquisition. In fact, Bank of America had agreed more than a month earlier to approve the payment of more than $5 billion...