Bank of America, Connecticut’s largest out-of-state bank, will pay federal taxpayers a total of $2.54 billion in dividends this year for bailout funds received under the Troubled Asset Relief Program, according to TheStreet.com.
BofA’s board of directors today authorized the Charlotte, N.C.-based bank to pay fourth-quarter dividends of $713 million to the government in mid-November, TheStreet.com reports on its Web site. To date, the company has paid $1.83 billion in TARP dividends.
The bank has received $45 billion worth of government funds since the financial crisis hit in September 2008 through two separate injections – the most recent of which primarily related to toxic assets from the bank’s controversial acquisition of Merrill Lynch.
According to TheStreet.com, the news comes with the company facing a maelstrom from regulators, lawmakers and shareholders in relation its merger with Merrill last January.
The lawsuits and investigations are probing whether BofA’s CEO Ken Lewis purposefully withheld material information from shareholders regarding increased losses on Merrill’s toxic assets and more than $5 billion in bonuses paid to its executives. Lewis, after more than 40 years at the company, resigned late Wednesday amid the backlash.
The company is paying the government a cash dividend of $312.50 per share, or approximately $188 million, on the Series N fixed rate cumulative perpetual preferred stock. The payment relates to the Treasury’s initial $15 billion investment in BofA under TARP.
It will also pay a cash dividend of $312.50 per share, or approximately $125 million, on the Series Q fixed rate cumulative perpetual preferred stock, related to the government’s $10 billion investment in Merrill, which was initially made under TARP before the two companies merged.
