Thursday, June 11, 2009
Bank of America Chief Executive Officer Kenneth Lewis said his bank decided to buy Merrill Lynch partly because it was pressured to do so by the Federal Reserve.
Lewis said the Federal Reserve threatened to remove top executives at his bank if it reneged on its promise to acquire Merrill Lynch, despite Merrill Lynch’s crumbling financial state.
Lewis told a House committee Thursday that it concerned him that federal officials would make that threat to a bank in “good standing.”
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The panel is investigating claims that top government officials, including then-Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke, pressured Lewis and urged him to keep quiet about Merrill Lynch’s financial problems.
Bernanke and Paulson, meanwhile, will be asked to testify on their role in the acquisition of Merrill Lynch, the Democratic chairman of the House Oversight and Government Reform Committee said.