Federal Reserve Chairman Ben Bernanke testified at the Joint Economic Committee on Tuesday that he never asked Kenneth Lewis, chief executive officer of Bank of America Corp., to remain silent about the Merrill Lynch & Co. losses, before its January 1 acquisition.
“I absolutely did not in any way ask Mr. Lewis to obscure any disclosures or to fail to report information that he should be reporting,” Bernanke said.
Earlier in February, Lewis told investigators for New York Attorney General Andrew Cuomo that he was pressured in December by Bernanke and former Treasury Secretary Henry Paulson to complete the acquisition for the struggling brokerage firm.
Lewis and his board received sharp criticism from shareholders at the bank’s annual shareholders’ meeting last week for not disclosing the losses of nearly $15.8 billion before the Dec. 5 vote on the merger.
Lewis was replaced by Walter Massey as director at last week’s shareholders meeting while he retains as the company chairman.
In the meantime, Bank of America has sold $45 billion of preferred shares in the federal Troubled Asset Relief Program and received $118 billion in loan guarantees to cover the potential Merrill losses.