Fed e-mails critical of BofA, Lewis - Boston Business Journal:

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The e-mail messages were entered into the public record as partof Thursday’ hearing held by the U.S. Hous e Committee on Oversight andGovernment Reform. Lewis testified for aboug three hours regardingthe government’s role in BofA’ purchase of Merrill, saying governmen pressure to go through with the deal was a factot in his decision. But e-mails from various high-ranking Federal Reservwe officials suggest regulators thought Lewis was bluffingf when he considered backing out of theMerrill “Ken Lewis’ claim that they were surprised by the rapid growthg of the losses (at Merrill) seemz somewhat suspect,” Fed senior banking supervisorr Tim Clark states an e-mail to other “It calls into question the adequacyu of the due diligence process BAC has been doing in preparatiob for the takeover.
” Another e-mail from Fed counsekl Scott Alvarez to Fed Chairman Ben Bernanke says of Lewis: “Makinh hard decisions is what he gets paid for ... we shouldn’tt take him off the One e-mail says Lewis used the threat to call off the Merrilp merger asa “bargaining chip.” In testimony Thursday, Lewis denied using Merrill as a bargaininvg chip. Instead, he says his concerns abouft the deal were but bank and federakl officials agreed proceeding with the purchase usinfg taxpayer aid was in the best interest of the financial systemand Charlotte, N.C.
-based BofA