Bank of America Corp. has freed itself from the strict executive-compensation rules and related government oversight by repaying the US Department of the Treasury $45 billion in federal funds from the Troubled Relief Asset Programme (TARP).
The repayment followed the completion of a $19.3 billion securities offering by the bank early this month (See: Bank of America raises $19 billion through equity sale).
Proceeds from the offering, along with cash reserves, funded the repurchase of all the preferred stock BoA had issued to the federal government.
The bank also paid the government $190 million in accrued dividends on the repurchased preferred securities.
The company originally received the government aid in two payments, an initial $25 billion in 2008 at the height of the financial crisis and another $20 billion in January 2009 as part of the deal to purchase Merrill Lynch & Co.
''We owe taxpayers our thanks for making these funds available to the nation's financial system and to our company during a very difficult time,'' says chief executive Kenneth Lewis.