Bank of America's rescue acquisition of Merrill Lynch

Merrill Lynch, one of Wall Street's oldest and largest brokerages, had piled up losses on mortgage-related securities through 2007 and 2008 similar to those that felled Bear Stearns and Lehman Brothers, and by September 2008 it faced a similar risk of collapse as counterparties and lenders lost confidence. On September 15, 2008 — the same day Lehman Brothers filed for bankruptcy — Bank of America announced an all-stock deal to acquire Merrill Lynch for about $50 billion, roughly $29 a share, a 70% premium to Merrill's closing price days earlier, reflecting how urgently a buyer was needed rather than what the business alone was worth. The combination gave Bank of America the world's largest retail brokerage network, with more than 20,000 financial advisers overseeing about $2.5 trillion in client assets. Shareholders of both companies approved the deal in December 2008, and it closed on January 1, 2009, though Merrill's larger-than-disclosed losses in the interim later triggered lawsuits and a congressional inquiry into what Bank of America knew before the vote.