Bank of America says it has agreed to pay $2.43 billion to settle a class-action lawsuit related to its acquisition of Merrill Lynch. The lawsuit was filed on behalf of investors that bought or held Bank of America stock when the company announced its plans to buy Merrill as the banking industry and federal government struggled to contain fallout from the financial crisis in the fall of 2008. Among the plaintiffs' allegations was that Bank of America and some of its officers made false or misleading statements about both companies' financial health.
In announcing the proposed settlement today, Bank of America denied the allegations; it says it agreed to the settlement to get rid of the uncertainties, burden, and costs related to the lawsuit. As part of the settlement, the bank has also agreed to adopt several corporate governance policies until Jan. 1, 2015, including those related to majority voting in board member elections, annual disclosure of noncompliance with stock ownership guidelines, and other policies. The settlement still needs court approval.