Paulson To Testify On BAC/Merrill Merger

On Jul 16, Former Treasury Secretary Henry Paulson is expected to testify before the House Oversight and Government Reform Committee as to whether he and/or other government officials pressured Bank of America (BAC) to acquire Merrill Lynch, which resulted in a $20 billion cost taxpayers.

This will follow BAC CEO Kenneth Lewis’ statements before the committee that both Paulson and Federal Reserve Chairman Ben Bernanke threatened to oust BAC’s CEO and the bank’s board members if they abandoned the takeover after discovering losses at Merrill.

In September 2008, BAC agreed to acquire Merrill Lynch, which resulted in the government supplying an additional $20 billion to BAC in order to cope with rising losses following the acquisition. This was on top of the $25 billion from the government’s bailout program.

We would be surprised if the story behind the headlines is ever revealed.

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