8-KOther EventsExhibits & Filings

BANK OF AMERICA CORP /DE/ 8-K Report, Corporate Update (Dec 18, 2008)

Filed December 18, 2008For Securities:BACBAC-PBBAC-PKBAC-PLBAC-PMBAC-PNBAC-PSBML-PJBAC-PEBAC-PPBAC-PQBACRPBML-PGBML-PHBML-PLBAC-POMER-PK

Summary

This 8-K filing from Bank of America (BAC) on December 18, 2008, reports on the issuance of an additional $1.5 billion in 3.125% Senior Notes due June 2012. These notes, together with previously issued notes, form a single series. A significant aspect of this offering is that the notes are guaranteed by the Federal Deposit Insurance Corporation (FDIC) under its Temporary Liquidity Guarantee Program (TLGP). This guarantee provides an added layer of security for investors, mitigating some of the perceived risk associated with the financial institution during the heightened uncertainty of late 2008. The filing also details the Written Terms Agreement entered into on December 15, 2008, with the initial purchasers for these notes. Investors should note that the terms of this offering are consistent with prior issuances under BAC's Medium-Term Note Program and are supplemented by specific pricing details. The FDIC guarantee is a crucial factor for investors, signaling an effort to bolster confidence in BAC's debt offerings amidst market stress.

Key Highlights

  • 1Bank of America issued an additional $1.5 billion in 3.125% Senior Notes due June 2012 on December 18, 2008.
  • 2These newly issued notes will be combined with $6.75 billion previously issued on December 4, 2008, to form a single series of notes.
  • 3The Senior Notes are guaranteed by the Federal Deposit Insurance Corporation (FDIC) under its Temporary Liquidity Guarantee Program (TLGP).
  • 4The FDIC guarantee is a key feature, intended to enhance investor confidence in BAC's debt obligations.
  • 5A Written Terms Agreement with initial purchasers for the notes was executed on December 15, 2008.
  • 6The offering is part of Bank of America's established Medium-Term Note Program, Series L.
  • 7This filing provides details on the terms of the notes and the agreement for their sale.

Frequently Asked Questions

The primary purpose of this 8-K filing is to report on Bank of America's issuance of an additional $1.5 billion in senior notes and to disclose that these notes are guaranteed by the FDIC under its Temporary Liquidity Guarantee Program.

The FDIC guarantee under the Temporary Liquidity Guarantee Program is highly significant for investors. It effectively guarantees the timely payment of principal and interest on the notes, reducing the credit risk for bondholders and making the debt offering more attractive during a period of market stress and uncertainty for financial institutions.

This issuance of $1.5 billion in notes, along with the $6.75 billion issued on December 4, 2008, will be consolidated into a single series of 3.125% Senior Notes due June 2012. This approach allows for a larger, more unified debt instrument.

The Temporary Liquidity Guarantee Program was an initiative by the FDIC in response to the 2008 financial crisis. It was designed to restore confidence in the U.S. financial system by guaranteeing certain senior unsecured debt and deposits of participating financial institutions, thereby improving their access to funding.