Bank of America said late Wednesday it planned to return the entire $45 billion in bailout money it received from the government over the past year.
The move would allow Bank of America, the nation's largest lender, to wriggle free from a variety of government restrictions it has had to abide by, including pay caps for its top executives.
It could also smooth what has been a difficult search for a new chief executive.[…]
The move, of course, will save Bank of America from having to make any further dividend payments on aid it received from the government. So far this year, the company has paid out $2.54 billion to the Treasury Department.
But exiting TARP won’t come without a cost. The company said it would reduce its fourth-quarter results by $4.1 billion as a result. The company is expected to report a loss of $524 million in the current quarter.
Bank of America noted however, it did not plan to exercise its right to repurchase warrants, or rights to purchase company shares, owned by the government.