NEW YORK, April 5 A $2.43 billion settlement between Bank of America Corp and investors who said the bank hid crucial information when it bought Merrill Lynch & Co was approved by a federal judge on Friday.
The accord, among the largest investor settlements stemming from the recent global financial crisis, was approved by U.S. District Judge Kevin Castel in Manhattan.
Bank of America had agreed to buy Merrill in an all-stock deal initially valued at $50 billion on Sept. 15, 2008 - the same day that Lehman Brothers Holdings Inc went bankrupt.
Merrill ended up losing $15.84 billion in that year's fourth quarter, even as it awarded $3.62 billion of bonuses to employees. Bank of America ultimately obtained a federal bailout, since repaid, to absorb Merrill.
Shareholders including the State Teachers Retirement System of Ohio and the Teachers Retirement System of Texas claimed that Merrill's mounting losses and bonus plans should have been disclosed before investors voted on the merger in December 2008.