Bear, JPMorgan Gets OK From NYSE

Bear Stearns now has the OK to issue 95 million shares of its common stock to JPMorgan. On Monday, both banks received formal approval from the Federal Reserve board which helped to engineer the deal late last month.

Bear Stearns had to petition the NYSE to allow the stock transfer to happen because most acquisitions require shareholder approval. The investment bank was able to bypass that because without approval its financial position would be put in jeopardy.

The closing of the sale of the shares is expected to occur by around Tuesday. In addition to the 11.5 million Bear Stearns shares that JPMorgan already owns, the latest agreement would boost its stake in the company to 44.9 percent.

JPMorgan plans to continue buying Bear Stearns shares in the open market or in private transactions, increasing its stake to as much as 49.5 percent.

On March 16, in a surprise deal that sent shock waves throughout the global markets, JPMorgan announced plans to buy Bear Stearns for a low price of $236.2 million or $2 a share. In an attempt to appease angry Bear Stearns shareholders, the nation's third-largest bank revamped the offer one week later to $10 a share, with the Federal Reserve Bank of New York promising to help finance the deal.

Earlier this week, Fed Chairman Ben Bernanke said the central bank was forced to broker a deal because the collapse of Bear Stearns could have been disastrous for the U.S. financial system.

Shares of Bear Stearns closed down 25 cents, or 2.3 percent, to $10.47 on Friday; JPMorgan fell 71 cents tot $45.57.