Bank of America, Merrill shareholders OK merger

A former Merrill Lynch executive blasted a former CEO.

CHARLOTTE, N.C. (AP) — Shareholders of Merrill Lynch & Co. and Bank of America Corp. on Friday approved the investment bank’s sale to Bank of America, a move that will create the nation’s largest financial-services firm.

During a special shareholders meeting at company headquarters in New York, Merrill shareholders approved the sale of the company, bringing to an end the independence of an investment bank founded in 1914.

Bank of America shareholders approved the deal later in the day.

“I’m happy with it, but I still think it is a gamble,” said Sam Brooks of Wayland, Mass., who was among several shareholders who spoke at the 90-minute meeting. “I want to give [Chief Executive Ken] Lewis and his team a chance to pull this off.”

A majority of those who spoke at the meeting down the street from the Charlotte, N.C.-based bank’s headquarters disapproved of the merger, saying it was risky. Some even asked Lewis to forgo his annual compensation package and take a $1 salary for the year.

“That money can be used to repay shareholders who have lost thousands of dollars,” said shareholder Judith M. Koenick, of Chevy Chase, Md.

Bank of America’s stock has fallen 63 percent this year as the credit crisis wears on.

Only a handful of shareholders spoke at Merrill’s 45-minute meeting in New York’s financial district, with most saying the deal was disappointing, though necessary amid the market turmoil. Many laid the blame for putting Merrill in the position of needing to sell to avoid failure on former Chief Executive Stan O’Neal and the board of directors for not providing the oversight required to protect the bank.

Among those who spoke was Win Smith Jr., a former chairman of Merrill Lynch International and whose father was among Merrill’s founders.

During his impassioned speech, Smith singled out the “failed leadership” of O’Neal and the board for Merrill’s troubles, noting that they sacrificed the company’s foundation and long-term growth for short-term gains amid the economic and housing booms earlier this decade.

Merrill has posted five consecutive quarterly losses as it has been forced to cut the value of holdings in a wide variety of investments such as mortgage-backed securities. O’Neal presided over Merrill as it ramped up its investments in such products.