Bank of America pays $425M to end U.S. guarantee

By doris | Published: September 22, 2009

Full Story at money.cnn.com

NEW YORK (CNNMoney.com) — Bank of America said Monday it will pay the U.S. government $425 million to end a federal backstop of assets related to its purchase of troubled brokerage Merrill Lynch earlier this year.

The government agreed to guarantee $118 billion in assets in January as part of a plan to help BofA absorb Merrill Lynch, which was on the verge of failure. In exchange, BofA agreed to pay the U.S. a fee of 3.7%.

On Monday, BofA said it will pay $425 million to the Treasury Department, Federal Reserve and Federal Deposit Insurance Corporation to terminate the agreement.

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