Monday, September 21, 2009
Bank of America Corporation announced that it has reached an agreement with the U.S. Government to terminate its term sheet with respect to the guarantee of up to $118 billion in assets by the U.S. Government. The term sheet was executed in connection with Bank of America's acquisition of Merrill Lynch in January 2009. Under terms of the agreement, Bank of America will pay $425 million to the Treasury Department, Federal Reserve and Federal Deposit Insurance Corporation. Bank of America also announced that it had received FDIC approval to exit the debt guarantee program under the FDIC's Temporary Liquidity Guarantee Program (TLGP).
According to the announcement, "The decisions to terminate the asset guarantee term sheet and exit the debt guarantee program are the latest in a series of steps taken by Bank of America to reduce its reliance on government support and return to normal market funding."