Pension funds sue BoA over Merrill Lynch purchase
Losses and Lawsuits
NEW YORK - The California Public Employees' Retirement System (Calpers) and the California State Teachers Retirement System (Calstrs) have filed for lead plaintiff status in a New York class-action lawsuit against Bank of America (BoA). The two funds are the largest US state pension funds; holding assets of $173 billion and $114 billion respectively. The legal challenge alleges BoA executives failed to disclose crucial information on the bank's deal to buy stricken investment bank and brokerage Merrill Lynch. Merrill went on to announce $15 billion of fourth-quarter losses within weeks of its sale and BoA has so far received $45 billion in federal bail-out funds.
Calpers and Calstrs join five pension funds that initially applied for lead plaintiff status after losing a combined $274 million between July 21, 2008 and Jan 20. The first round of plaintiffs include the Texas and Ohio state teaching pensions; Ohio's general state fund for public employees; a Netherlands fund representing the Dutch healthcare and social sector; and a large Swedish national pension fund.
The plaintiffs allege proxy statements published before the conclusion of the troubled acquisition failed to disclose Merrill's true financial condition and that BoA failed to conduct adequate research into the deal.
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
More on Regulation
Banks will not be frowned upon for discount window borrowing – Fed official
Risk Live: more banks have completed paperwork to access Fed lending facility than a year ago
Capital One puts OCC’s tough stance on mergers to the test
Proposed Discover deal should be approved but will go under the microscope, ex-regulators say
As FCMs dwindle, regulators fear systemic risk
Panellists highlight dangers of clearing membership becoming more concentrated
EU banks fear green asset ratios paint an unfair picture
Industry lobbyist clashes with lawmaker over usefulness of new sustainability disclosure
EU watchdogs to launch prop trader capital review in April
Prop traders say bank-style IFR rules are driving them out, but doubt EBA will suggest changes
Investors say new SEC disclosures may sit on shelf
Advisory committee questions value of rule 605 changes, even for retail investors
CFTC hears ‘call to action’ from swaps end-users on Basel III
Commissioner Pham mulls engaging with prudential regulators over capital hit on clearing
Iosco gears up for ‘intensive work’ on AI regulation
Watchdogs risk ‘falling behind the curve’, secretary-general warns; FSB also working on guidance
Most read
- As FCMs dwindle, regulators fear systemic risk
- Top 10 operational risks for 2024
- Top 10 op risks: AI fears drive cyber risk to record high