Two of Wall Street’s most powerful firms are dealing with financial woes the best way they know how, they’re selling.
Merrill Lynch agreed to sell itself to Bank of America for about $50 billion dollars. “[This] would create the world’s second-largest bank by market value, after Industrial & Commercial Bank of China, and combine the largest U.S. consumer bank with one of the largest U.S. investment banks and the leading retail brokerage force,” Reuters said.
This agreement came as a result of Merrill Lynch’s financial issues due to the downward spiraling economy.
According to the Miami Herald, Bank of America will take Merrill’s 15,000 brokers under its wing and Merrill’s current head of global wealth management will lead the flagship.
Lehman, an almost 2 century old bank, was also on the auction block. Unlike Merrill-Lynch, the Federal Reserve had decided to divide it into profitable and non profitable parts and sell accordingly. But this past weekend, the decision fell through and the bank is now entering into bankruptcy the Herald said.
Only time will tell what major impact the dissolution of these two major Wall Street players will have on the already shaky economy. But one things for sure, several other mortgage powerhouses like American International Group (AIG) might be following suit.
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