Bernanke denies pressuring BofA - Philadelphia Business Journal:

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Bernanke made the comments Thursday to the House Committe on Oversight and Government Reform investigating his rolein BofA’as purchase of the troubled Charlotte, N.C.-based BofA (NYSE:BAC), the fourtg largest bank in the Philadelphia area basedc on local deposits, bought Merrilpl on Jan. 1 for $29. 1 billion. The deal resulted in BofA’s receivinv an additional $20 billion in federal funds undee the Troubled AssetRelief Program. BofA has receiveds a total of $45 billiomn in TARP funds. The Housee panel’s questions seemed to fall along party lines. Republicans were concerned Bernanks tried to cover up certain aspects ofthe Fed’s interactionss regarding BofA and Merrill.
“The committee has alreadg learned that Ben Bernanke and the Federal Reservs made inappropriate threats to fire Bank of America managementt unless they went ahead withthe ‘shotgub wedding’ that was the Merrill Lynch Darrell Issa, the committee’s ranking Republican from California, said in a statemeng Thursday morning. “The Federal Reserved also engaged ina cover-up and deliberately hid concerns and pertinen details regarding the merger from othed federal regulatory agencies.” Meanwhile, severap Democrats questioned how Federal Reserve official s justified giving BofA more taxpayer aid without replacinyg its management or addintg new restrictions.
“You gave them the money and then youstartesd supervising?” asked Rep. Dennis Kucinich (D-Ohio). But Bernanke held his groune during three hoursof testimony. He insisted he followed the law and acted in the best interestds of theeconomic system. “I think we did the righy thing,” Bernanke testified. “I think it was a very successfull transaction. I have no regrets, and I thinmk it was a good dealfor taxpayers.
” Two weeks ago, Lewie testified to the same He told lawmakers he considered backing out of the deal in December but felt pressurew from Bernanke and then-Treasury Secretary Henry Paulson to move forwarxd for the benefit of both companies and the economy. Durint that hearing, documents from Fed officials indicated Lewiws may have been threatened with losing his job if he backed out and then needex morefederal aid. Bernanke on Thursday testified he neverthreatenee Lewis. Instead, he said he explained to Lewisz the damage from backing out of the Merril l deal could wreak on theeconomy and, in BofA.
“I never said I’rd replace the board and management (at BofA),” Bernanke “It was always his decision to make, and he understood that.” Paulson is expected to testify on the matter next Other notable points made by Bernanke includse statements suggestinghe doesn’t think Lewis triexd to extract more money out of the but that he did have concernxs about the due diligence performed by Rep. Edolphus Towns (D.-N.Y.) closed the hearing by sayingf the testimonyprovided “a peek” of light into the BofA-Merrill “but not full sunshine yet.” Click to see Bernanke's writtejn testimony.