WASHINGTON – Bank of the United States (the Federal Reserve) gave formal approval to Bank of America to acquire Merrill Lynch, the Wall Street icon battered by the credit crisis.
Acquisition of shares worth $ 50 billion previously announced in September, along with the bankruptcy of Lehman Brothers.
The Fed expressed very cautious in considering the acquisition proposal, and finally decided there was no adverse effect of the acquisition of the banking market or other relevant market.
Excerpted from the Wall Street Journal, Bank of America currently has $ 1, 8 trillion in consolidated assets and manage deposit USD774, 2 billion, which represents 10.8 percent of total deposits in banks in the land of Uncle Sam. While Merrill Lynch has consolidated assets of USD875 billion and manage savings of $ 77, 8 billion.
The Fed said the acquisition will make the company’s assets to $ 2, 7 billion and manage fund saving up to USD852 billion, or 11.9 percent of the total bank deposits in the U.S..
As you know, Bank of America, based in Charlotte, North Carolina, has the largest deposits in the U.S., while Merrill Lynch is a broker company that is known throughout the world.
The Fed’s announcement of its approval of the acquisition comes after Bank of America shares rose 63 cents, or 4.3 percent, to close at USD15 number, 42. While acquiring shares of Merrill Lynch rose 85 cents, or 7.5 percent, to close at USD12 number, 21.
“Blending a wealth management firm in the world with the biggest bank financial services company will present the most important in the world, without any match,” said Bank of America director Kenneth Lewis, quoted by AFP.