Banking

Bank of America to post $600 million pretax writedown in fourth quarter

By Hugh Son

Bloomberg News
Bank of America will post a $600 million pretax writedown in the fourth quarter as it redeems $2 billion of trust preferred securities tied to its 2009 acquisition of Merrill Lynch.
Bank of America will post a $600 million pretax writedown in the fourth quarter as it redeems $2 billion of trust preferred securities tied to its 2009 acquisition of Merrill Lynch. Mark Lennihan AP

Bank of America will post a $600 million pretax writedown in the fourth quarter as it redeems $2 billion of trust preferred securities tied to its 2009 acquisition of Merrill Lynch.

“The company expects to realize cash savings from lower funding costs as a result of the redemption,” the Charlotte, North Carolina-based lender said Tuesday in a statement.

The securities, which pay holders 7 percent to 7.28 percent, will no longer count toward the bank’s regulatory capital starting next year, the bank said.

Bank of America is scheduled to report its fourth-quarter results on Jan. 19.

This story was originally published December 29, 2015 at 5:00 PM with the headline "Bank of America to post $600 million pretax writedown in fourth quarter."

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