Plenty of smoke here, with the fire to come over the weekend and/or next week.
Why don't we hear about this sort of thing from the US media until after hours? Are they too busy asking softball questions?
The timing of this disclosure, after the BofA acquisitions and the billions in last minute bonuses paid, is priceless.
Economic Times (India)
Merrill review spots trading 'irregularity'
7 Mar 2009, 0047 hrs IST, Bloomberg
LONDON: Merrill Lynch & Co, the securities firm acquired by Bank of America Corp, said it uncovered an “irregularity” during a review of its trading operations.
The bank informed regulators immediately of the discrepancy in “certain trading positions”, Merrill Lynch said in a statement from London. The bank said it’s working with the authorities to investigate further. A spokeswoman for the bank declined to comment further.
Merrill Lynch may have lost hundreds of millions of dollars on currency trading and credit derivatives last year, the New York Times reported earlier on Thursday.
The losses did not “spill into plain view” until after Bank of America investors had approved the $33 billion takeover in December and Merrill Lynch disbursed $3.6 billion in bonuses to bankers, the newspaper said. Bank of America later sought additional government funding. “Senior managers of the business are focused on the issue and believe the risks surrounding possible losses are under control,” Merrill Lynch said in the statement.
Bank of America Chief Executive Officer Kenneth Lewis is trying to rein in Merrill’s traders after their losses brought the bank to the brink of collapse, the New York Times said.
“It was always going to be extremely difficult to integrate a retail bank like Bank of America with an investment bank like Merrill because the cultures are so different,” said Richard Staite, an analyst at Atlantic Equities LLP in London. He has an “underweight” rating on Bank of America’s shares.
“Thus, it should be understood that when pro-US figures use the term, 'rules-based international order,' they are not referring to anything analogous to the rule of law. Quite the opposite, they are using Orwellian language to describe a system in which essentially no rules can be established and/or observed, given that the dominant state has the prerogative to violate and/or rewrite “rules” at its whim.” Aaron Good, American Exception