U.S. lawmakers voiced their anger with CEO Kenneth Lewis and government regulators yesterday, over emails that suggest the bank should have known earlier about growing losses at Merrill Lynch, reports the Wall Street Journal.
“Why did a private business deal, announced in September, and approved by shareholders in December, with no mention of government assistance, end up costing taxpayers $20 billion in January?” Rep. Edolphus Towns (D-NY) asked at a hearing featuring an appearance by Lewis on Capitol Hill.
Officials wanted Lewis to explain why Bank of America did not inform its shareholders of its growing concerns with the losses at Merrill Lynch.
Lewis acknowledged that there were suggestions that Bank of America management would be replaced if they went through with the plan to stay away from the Merrill Lynch acquisition. However, he said that officials did not pressure the company to withhold such information from shareholders.
The comments came at a hearing before the House Committee on Oversight and Government Reform. Lewis maintained that the bank and government regulators believed that going through with the deal was the “better course” to abandoning the transaction.
He said that he did not feel that the federal officials acted improperly in pressuring the firm to complete its acquisition. “I do not. I would say they strongly advised and they spoke in strong terms, but I think it was with the best intentions,” Lewis said.