Bank of America has resolved one of the largest and most embarrassing pieces of litigation related to its merger with Merrill Lynch in 2008. But the settlement comes with a pretty hefty price tag, since the bank has agreed to pay $2.43 billion to end the lawsuit. That monetary award ranks it as one of the largest settlements in a securities class-action case, behind the settlement over the disastrous AOL-Time Warner merger.
The acquisition of Merrill caused Bank of America plenty of headaches by adding toxic mortgage assets to its balance sheet on top of what the bank took on when it bought Countrywide Financial. The bank has also been fighting with Fannie Mae and Freddie Mac over whether it will have to take back bad mortgages packaged into mortgage-backed securities.