On January 16 the bank released its fourth-quarter earnings statement. Its press release finally disclosed Merrill’s 2008 fourth-quarter loss of $15.3 billion. On the news, bank shares plunged. The bank also revealed the Bernanke “support package”—the government would invest another $20 billion in bailout funds and would provide further protection against losses on some $118 billion in toxic assets.
Ten months later, the merger looks like it will be a sound financial deal for the bank in the long term. Lewis is pushing to repay at least part of its bailout funds right away. In its second-quarter earnings (the latest available at press time) the bank reported net income of $3.2 billion, and its stock price is inching back up. But the legal and internal fallout hasn’t been as kind.
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