Bank of America
gave their official blessing Wednesday to one of the biggest bank deals ever.
Shareholder approval for the mega-merger comes just days after the two banks agreed to pay $675 million in fines, restitution and fee reductions over their respective roles in the mutual fund trading scandal.
North Carolina-based Bank of America, which is acquiring Boston-based Fleet, is paying the lion's share of the fines in the mutual fund inquiry. Even though the vote on the merger was never in doubt, bank executives had wanted to reach a deal with securities regulators before they held their shareholder meetings.
The deal, originally valued at $47 billion, included a hefty 40% premium that was roundly criticized at the time. In the immediate aftermath of the October announcement, BofA shares fell more than 11%. But by the time of the vote, the bank's stock had recovered all those losses.
Ken Lewis, BofA's chairman and chief executive, told shareholders the merger will result in $1.1 billion in savings from the elimination of redundant services and systems.
Lewis, however, didn't identity where those savings would come from. He also didn't comment on analyst estimates and media reports that the combined bank could eliminate up to 13,000 jobs.
In late-morning trading, shares of BofA were up 21 cents to $80.32 a share, while Fleet's stock was up 18 cents to $44.52 a share.
In the deal, which is expected to close the first week of April, Fleet stockholders will receive 0.55 of a BofA share for each of their shares.
The merger will create a bank with $1 trillion in assets, with branches spread across the country. The new bank will control 9.9% of U.S. customer deposits, bumping up against the 10% threshold allowed by bank regulators.
The combined bank will be the third largest behind
J.P. Morgan Chase
, which is buying
in another pending mega-deal.