Henry Paulson John Thain & Merrill Lynch Ken Lewis & Bank of America The Merger & the Fallout Nationalizing Banks Gov't Documents/Resources

Treasury Secretary Henry Paulson

Mr. Risk Goes to Washington
"Hank Paulson's profound understanding of risk and reward makes him the perfect pick for Treasury," says BusinessWeek. (June 12, 2006)

The Captain of the Street
Newsweek's Daniel Gross on Paulson: "... [he] has succeeded in fundamentally altering the relationship between Wall Street and Washington -- almost to the point where D.C. is now the world's financial capital." (Sept. 20, 2008)

Struggling to Keep Up as the Crisis Raced On
Paulson tells The New York Times he had no legal recourse to rescue Lehman Brothers and defends using TARP money to recapitalize the banks. There's an audio excerpt of the hour-long interview with him. (Oct. 22, 2008)

Paulson on TARP Paybacks: "Beginning of the Unwinding"
Read Paulson's press release on the news that 10 of the largest banks had approval to begin paying back the TARP money he'd forced them to take. "Today's announcement confirms that the TARP programs, in conjunction with the FDIC guarantee and the Fed's liquidity programs, worked to stabilize our financial system." (June 9, 2009)

Looking Back in Anger at the Crisis
New York Times business columnist Joe Nocera covers former Treasury Secretary Pauslon's appearance before the House Government Reform and Oversight Committee, a panel Nocera calls "almost bizarrely obsessed" with the Bank of America-Merrill Lynch merger. "In retrospect, Congress felt bullied by Mr. Paulson last year," he writes. "Now that the crisis has subsided, it is payback time." You can also read Paulson's prepared testimony, or watch video of him delivering it. (July 18, 2009)

John Thain & Merrill Lynch

The Brain in Thain
New York magazine's profile of Thain while he was at the helm of the New York Stock Exchange. "Since taking over for his scandal-racked predecessor, Dick Grasso, in 2003, Thain has transformed what was once an insular, semi-private club into a modern, public corporation." (Jan. 1, 2007)

No Thain, No Gain
A Forbes profile of Thain, five months into his tenure at Merrill Lynch. It's also a concise explanation of Merrill's business and how the firm got itself into trouble. (March 13, 2008)

How the Thundering Herd Faltered and Fell
Gretchen Morgenson looks at how "Merrill ended up getting burned ... by inadequately assessing the risks it took with newfangled financial products," under Thain's predecessor, E. Stanley O'Neal. (The New York Times, Nov. 8, 2008)

John Thain Fires Back at Bank of America
"Getting fired is one thing. But nobody has the right to say things that they know aren't true." Watch video of Thain's interview with The Wall Street Journal's Suzanne Craig here. (April 28, 2009)

Ken Lewis & Bank of America

Banker of America
A Fortune profile published after Lewis acquired credit card giant MBNA: "Can BofA prosper without serial deals?" Even then, there were concerns about the CEO's acquisitiveness: "Wall Street would really like Lewis to just settle down and digest everything he's swallowed. Don't bet on it." (Sept. 5, 2005)

Money for the Masses
Forbes magazine likens BofA's focus on retail banking to Starbucks and Kmart and explains the company's cross-selling strategy: "BofA's brokerage arm will give you 360 free trades per year if you have $25,000 in your bank accounts. Think of it as a teller's way of saying, 'Do you want fries with that?'" (Oct. 1, 2007)

Bank of America Chief Ousted as Chairman
"While Mr. Lewis remains chief executive -- the board expressed its unanimous support for him -- many inside and outside the bank wonder if he can hang on," reports Louise Story for The New York Times. (April 29, 2009)

Times Topics: Kenneth D. Lewis
Will Lewis hold on as CEO of Bank of America? Follow the latest news here.

The Merger & the Fallout

Bank of America to Buy Merrill
The Wall Street Journal's reports on Merrill's "rushed bid to ride out the storm sweeping American finance," a deal that "could instantly reshape the U.S. banking landscape, making the nation's prime behemoth even bigger." (Sept. 15, 2009)

CNBC Video: BofA-Merrill Press Conference
The two CEOs tout the "strategic fit" of the firms and deny there was government pressure to do the deal. Later that day, Lewis sat down with CNBC's Maria Bartiromo to defend the price he paid for Merrill. (Sept. 15, 2009)

Excerpt From the Merger Agreement
A page from the Sept. 15 BofA-Merrill agreement showing that BofA agreed to Merrill bonuses for 2008 so long as they didn't exceed "$5.8 billion in aggregate value." But this letter from BofA to Merrill, retranscribed from an original obtained by FRONTLINE, lowers the total amount of 2008 bonuses to $3.57 billion. It's dated Dec. 11, 2008 -- a few days after BofA shareholders approved the merger.

Brokers Disdain Toaster Salesmen in Bank America Deal
Bloomberg reports on the discord between Bank of America and the "crown jewel" of the Merrill deal: the firm's 16,000 brokers. Will Ken Lewis emerge from the financial crisis "poised to rule Wall Street just like he's dominated Main Street," or will his massive bank be "stifled by culture clashes and bureaucracy"? (Jan. 9, 2009)

In Merrill Deal, U.S. Played Hardball
The Wall Street Journal reconstructs how Ken Lewis tried to get out of the Merrill deal but was opposed by Treasury Secretary Paulson and Federal Reserve Chairman Ben Bernanke. An accompanying interactive feature tracks BofA's and Merrill's share prices against various milestones in the deal. (Feb. 5, 2009)

CNBC Video: The Thain Redecorating Flap
Watch Charlie Gasparino break the news of John Thain's $1.2 million office redecoration and Ken Lewis' "emergency meeting" with Thain about his future with the company. Thain told his side of the story to CNBC's Maria Bartiromo a week later. (Jan. 22, 2009, Jan. 30, 2009)

For Bank of America and Merrill, Love Was Blind
"Interviews with almost 30 current and former Bank of America and Merrill executives and employees convey just how messy the merger has been" in The New York Times' definitive take on the deal. Among the juicy details: Applause broke out on Bank of America's trading floor when John Thain was forced out. (Feb. 7, 2009)

Wall Street's $18.4 Billion Bonus
Vanity Fair puts the Merrill Lynch bonuses in context: While the CEOs of top firms receiving TARP money have foregone bonuses, many of their employees got them anyway. New York Attorney General Andrew Cuomo is aiming to "claw back" some of the money. (March 2009)

Lewis Testifies U.S. Urged Silence on Deal
The Wall Street Journal broke this story based on leaked testimony Ken Lewis gave to New York Attorney General Andrew Cuomo, who was investigating the Merrill bonuses. The article has links to other documents released by Cuomo, including excerpts of Lewis' testimony. (April 23, 2009)

Lawmakers Examine Purchase of Merrill Lynch
Watch Ken Lewis get grilled before the House Government Oversight and Reform Committee over whether the government pressured him to go through with the deal for Merrill Lynch in this PBS NewsHour report. (June 11, 2009)

House Government Oversight and Reform Committee -- Bank of America and Merrill Lynch: How Did a Private Deal Turn Into a Federal Bailout?
Read Ken Lewis' prepared remarks and e-mails from Federal Reserve employees subpoenaed by the committee. Lewis says the government "expressed significant concerns about the systemic consequences and risk to Bank of America" if the bank pulled the plug on its acquisition of Merrill Lynch. Fed employees, meanwhile, didn't consider Lewis' threat to scuttle the deal credible and refused to give Lewis legal cover from shareholder lawsuits. (June 11, 2009)

Nationalizing Banks

Times Topics: Nationalization of Banks
Reporting and opinion from The New York Times, including expert commentary and op-eds by Nobel laureates Paul Krugman and Joseph Stiglitz.

Crisis Q&A: What "Bank Nationalization" Means For You
The Wall Street Journal's Deal Journal blog gives the basics on what it means to nationalize a bank. (Jan. 21, 2009)

Nationalization is a Done Deal, Let's Move On
Bloomberg columnist David Reilly calls the debate over nationalization a "smoke screen" and urges the government to get on with cleaning up the mess. (Feb. 25, 2009)

A Ghoulish Prospect
The Economist weighs in on the nationalization question: Better an insolvent bank become "a temporary ward of the state than a permanent zombie." (Feb. 26, 2009)

Will the Banks Survive?
Fortune explains why the big banks continue to struggle despite government aid. The worry is that, as the economy gets worse, borrowers will default on credit card, home equity and other loans, forcing the banks into the arms of the government. (Feb. 27, 2009)

This American Life: Bad Bank
Adam Davidson and Alex Blumberg of NPR's Planet Money explain the basics of banking, how the banks got into trouble, and the government's plan for fixing it. (Feb. 27, 2009)

Some Myths About Banks
In a Wall Street Journal op-ed, Bank of America CEO Ken Lewis argues the debate over nationalizing the banks "has been riddled with misinformation." He maintains banks are lending and solvent, that the TARP program worked, and that nationalizing the banks would "undermine confidence in the financial system." (March 9, 2009)

Banks, Obama in Uneasy Truce
The president hosted the heads of the nation's banks at the White House after weeks of tension over the administration's stress tests and limits on executive compensation. (The Wall Street Journal, March 28, 2009)

Bank Profits Appear Out of Thin Air
Columnist Andrew Ross Sorkin doesn't buy the "sleight of hand" used by Bank of America and other banks to produce first quarter profits. But he's not sold on the government's stress tests, either. "If no bank fails, then what's the value of the stress test?" (The New York Times, April 20, 2009)

The Quiet Coup
Simon Johnson compares the U.S. crisis to others he dealt with as chief economist of the International Monetary Fund. The common factor, he argues, is the influence of the financial elite over government. Johnson also co-writes the blog The Baseline Scenario; read his post about the stress tests and nationalization. (The Atlantic, May 2009)

Q&A: How The Banks Fared On Their Stress Tests
NPR runs down the winners and losers of the Federal Reserve's stress tests of the nation's 19 largest banks. Among the losers: Bank of America, which will need to raise another $33.9 billion to meet government requirements. [Note: In his June 11 testimony before Congress, Ken Lewis announced the company had succeeded in raising the capital required under the stress test.] (May 7, 2009)

10 Large Banks Allowed to Exit U.S. Aid Program
The New York Times calls the decision to let Goldman Sachs, JPMorgan Chase and others begin repaying TARP money "a major milestone." But Bank of America and Citigroup are not allowed to repay the money, prompting questions about their financial health. (June 9, 2009)

Calls Resume for Single Banking Regulator
Congressional Democrats and Republicans alike are pushing the Obama administration to propose one central regulator for banks when it announces its framework for reform June 17. "This is a once-in-a-lifetime opportunity: Be as bold as you can," advised Sen. Charles Schumer (D-N.Y.) in a letter to Treasury Secretary Timothy Geithner. (The Washington Post, June 12, 2009)

Gov't Documents/Resources

Judicial Watch: Bank Bailout Documents
Read Treasury Secretary Henry Paulson's talking points from his meeting with the heads of the nation's largest banks, plus the "participation commitments" each CEO signed agreeing to take billions of dollars from the Troubled Asset Relief Program (TARP).

House Financial Services Committee -- Use of Federal Assistance by the First TARP Recipients
Read the prepared statements of the bank CEOs and politicians at the hearing featured in Breaking the Bank. (Feb. 11, 2009)

FinancialStability.gov
The official Web site of the Troubled Asset Relief Program (TARP) features a "decoder" of financial terms, a list of the contracts the government has entered into under the TARP, and a summary of the administration's plan.

TARP Congressional Oversight Panel
Chaired by Harvard law professor Elizabeth Warren, the panel was created in October 2008 to "review the current state of financial markets and the regulatory system." The panel's Februrary 2009 report found that the TARP was only receiving a 66 percent return on its transactions, and on June 9 it called for the government to conduct another, tougher stress test of the banks.

Financial Regulatory Reform: A New Foundation
On June 17, President Obama proposed reforms to the nation's financial regulations. The new scheme would give the Federal Reserve more power, better regulate "over-the-counter" derivatives like credit default swaps, and create a procedures for winding down systemically important institutions that are not banks. Read the whole proposal or the shorter summary. The New York Times' Economix blog has collected reactions to the plan.