CHARLOTTE, N.C. ( TheStreet) -- Bank of America (BAC - Get Report) said in a regulatory filing late Monday that the Treasury Department will auction 272 million warrants associated with the government's $45 billion bailout of the bank in 2008.
Bank of America agreed to issue the warrants to the Treasury in return for a $25 billion preferred equity investment through the Troubled Asset Relief Program in late 2008 and another $20 billion preferred equity investment made in early 2009, made to keep the company from backing out of a deal to acquire tottering Merrill Lynch. While Bank of America has repaid those investments to Treasury, it did not reach an agreement on the price of the warrants and agreed to the auction.
Two sets of warrants, one for 150.4 million securities that will carry a minimum bid of $7 each and another 121.8 million securities with a minimum bid of $1.50 each, will be issued in an auction run by Deutsche Bank Securities on Wednesday. The auction begins at 8 a.m. and closes at 6:30 p.m.
|Donald Kohn, vice chairman of the Federal Reserve.|